The company plans to issue the capital in three parts – the first an institutional placement of $25 million, the second an institutional entitlement offer worth up to $19.2 million, and a retail entitlement offer which the company hopes will raise a further $15.8 million. The institutional placement is going ahead today, and Macmahon will stay in a trading halt while this offer goes ahead. The retail offer will allow eligible shareholders to subscribe for one new share for every five Macmahon shares they already hold at 32c per share. The entire offer is underwritten to the tune of $47.4 million, with Macmahon’s largest shareholder, Leighton Holdings, agreeing to sub-underwrite part of the retail offer. This could see Leighton increase its holding in Macmahon to 19.9% of its diluted shares on issue. Additionally, Macmahon’s board and chief executive officer Nick Bowen will also participate in the offer. Bowen today said the cash would be used to pay down Macmahon’s debt and boost its working capital, giving the company a strong enough balance sheet to survive the current slowdown. Early last week Macmahon more than halved its profit guidance for 2009 due to contract deferrals and cancellations from its mining clients. The Perth-based company said its mining division had been the hardest hit in recent months, with monthly revenues 30-40% lower on average than six months ago, equating to more than $250 million of annualised revenue.In April the company said because of a reduction in its free cash flow, its level of gearing was currently just under 40%, compared to 12% at December 2008. As at December 31, Macmahon had $32.4 million worth of loans and borrowings as liabilities due to be repaid within 12 months, and $72.9 million in non-current liabilities.Today Bowen said Macmahon was also well placed to take advantage of the resurgent construction and infrastructure sector, with the government’s plans to spend up big on infrastructure further reinforcing the positive outlook for the sector. Early last week Macmahon more than halved its profit guidance for 2009 due to contract deferrals and cancellations from its mining clients. The Perth-based company said its mining division had been the hardest hit in recent months, with monthly revenues 30-40% lower on average than six months ago, equating to more than $250 million of annualised revenue.Shares in the company were at 40c before it entered a trading halt yesterday.