Orion Group Holdings Announces Proposed Public Offering of Common Stock

Rhea-AI Summary

Orion Group Holdings (NYSE: ORN), a leading specialty construction company, has announced a proposed public offering of common stock. The company intends to grant the underwriter a 30-day option to purchase additional shares. Craig-Hallum Capital Group is acting as the sole managing underwriter for the offering.

Orion plans to use the net proceeds for working capital and general corporate purposes, which may include repayment of indebtedness under its credit agreement. The offering is subject to market conditions, and there is no assurance regarding its completion or final terms. A shelf registration statement for the shares has been filed with the SEC and is effective.

Positive

• Potential to raise capital for working capital and debt repayment
• Opportunity to strengthen the company's financial position

Negative

• Potential dilution of existing shareholders' ownership
• Uncertainty regarding the final size and terms of the offering
• Market conditions may affect the success of the offering

Insights

Financial Analyst

Orion Group Holdings' proposed public offering of common stock is a significant financial move that could impact its capital structure and liquidity. This equity raise suggests the company is seeking to strengthen its balance sheet, potentially to fund growth initiatives or address existing debt obligations. The mention of using proceeds for "repayment of indebtedness under its credit agreement" indicates a focus on deleveraging, which could improve financial flexibility.

However, investors should be aware that this offering will likely result in dilution of existing shareholders. The extent of dilution will depend on the final size and pricing of the offering, which are yet to be determined. The market's reaction to this news may be mixed, as improved financial health could be offset by concerns over share value dilution.

The involvement of Craig-Hallum Capital Group as the sole underwriter suggests a targeted approach to the offering, which could influence its reception among institutional investors. Overall, this move signals both opportunities and challenges for Orion's financial position and shareholder value.

Market Research Analyst

Orion Group Holdings' decision to pursue a public offering reflects broader market trends in the specialty construction sector. With interest rates at elevated levels, companies are increasingly turning to equity markets for capital rather than taking on additional debt. This move could be seen as a proactive step to maintain competitiveness in a challenging economic environment.

The timing of this offering is intriguing, potentially signaling management's confidence in the company's near-term prospects or upcoming projects. However, it's important to consider the current market appetite for construction stocks, which may influence the success of the offering. Investors should watch for the final terms and market reception as indicators of both Orion's standing and broader sector sentiment.

The use of proceeds for working capital and debt repayment suggests a focus on operational stability rather than aggressive expansion, which may be viewed positively in an uncertain economic climate. This conservative approach could resonate with risk-averse investors seeking companies with solid financial foundations.

HOUSTON, Sept. 10, 2024 (GLOBE NEWSWIRE) -- Orion Group Holdings, Inc. (NYSE: ORN) (“Orion” or the “Company”), a leading specialty construction company, today announced that it intends to offer and sell shares of its common stock in an underwritten public offering. In connection with the offering, Orion also expects to grant the underwriter a 30-day option to purchase additional shares of common stock offered in the public offering. The offering is subject to market conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the final size or terms of the offering. The Company intends to use the net proceeds from this offering for working capital and general corporate purposes, which may include repayment of indebtedness under its credit agreement.

Craig-Hallum Capital Group is acting as the sole managing underwriter for the offering.

A shelf registration statement relating to the shares of common stock to be issued in the proposed offering was filed with the Securities and Exchange Commission (the “SEC”) and is effective. This press release does not constitute an offer to sell, or the solicitation of an offer to buy, these securities, nor will there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale is not permitted.

The Company will file a preliminary prospectus supplement and accompanying prospectus describing the terms of the proposed offering with the SEC. The securities may be offered only by means of a prospectus, including a prospectus supplement, forming a part of the effective registration statement. Copies of the preliminary prospectus supplement and the accompanying prospectus relating to the securities being offered may be obtained from Craig-Hallum Capital Group LLC, Attention: Equity Capital Markets, 222 South Ninth Street, Suite 350, Minneapolis, MN 55402, by telephone at (612) 334-6300 or by email at prospectus@chlm.com. Electronic copies of the preliminary prospectus supplement and accompanying prospectus will also be available on the SEC's website at http://www.sec.gov. The final terms of the offering will be disclosed in a final prospectus supplement to be filed with the SEC.

About Orion Group Holdings

Orion Group Holdings, Inc. is a leading specialty construction company serving the infrastructure, industrial, and building sectors, providing services both on and off the water in the continental United States, Alaska, Hawaii, Canada and the Caribbean Basin through its marine segment and its concrete segment. Its marine segment provides construction and dredging services including marine transportation facility construction, marine pipeline construction, marine environmental structures construction, dredging of waterways, channels and ports, environmental dredging, design, and specialty services related to marine construction, fabrication, and dredging. Its concrete segment provides turnkey concrete construction services including concrete surface place and finish, site preparation, layout, forming, and rebar placement for large commercial, structural and other associated business areas. The Company is headquartered in Houston, Texas with regional offices throughout its operating areas.

Forward-Looking Statements

The matters discussed in this press release may constitute or include projections or other forward-looking statements within the meaning of the “safe harbor” provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, of which provisions the Company is availing itself. Certain forward-looking statements can be identified by the use of forward-looking terminology, such as “believes,” “expects,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” or “anticipates,” or the negative thereof or other comparable terminology, or by discussions of strategy, plans, objectives, intentions, estimates, forecasts, outlook, assumptions, or goals. In particular, statements regarding the timing, size, terms, conditions, results, outcome and use of proceeds from the offering are forward-looking statements. Forward-looking statements involve risks and uncertainties. Considering these risks and other uncertainties, the inclusion of forward-looking statements in this press release should not be considered to be a representation by the Company that the Company's plans, estimates, forecasts, goals, intentions, or objectives will be achieved or realized. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company assumes no obligation to update information contained in this press release whether as a result of new developments or otherwise, except as required by law.

Please refer to the Company's 2023 Annual Report on Form 10-K, filed on March 1, 2024, Quarterly Reports on Form 10-Q and other subsequent filings with the SEC, which are available at the SEC's website at www.sec.gov, for additional and more detailed discussion of risk factors that could cause actual results to differ materially from our current expectations, estimates or forecasts.

Contacts:

Scott Thanisch
Chief Financial Officer
Orion Group Holdings, Inc.
310-622-8256
orn@finprofiles.com

Margaret Boyce 
Financial Profiles, Inc.
310-622-8247
orn@finprofiles.com

Source: Orion Group Holdings, Inc.

FAQ

What is the purpose of Orion Group Holdings' (ORN) proposed public offering?

Orion Group Holdings (ORN) intends to use the net proceeds from the proposed public offering for working capital and general corporate purposes, which may include repayment of indebtedness under its credit agreement.

Who is the underwriter for Orion Group Holdings' (ORN) proposed stock offering?

Craig-Hallum Capital Group is acting as the sole managing underwriter for Orion Group Holdings' (ORN) proposed public offering of common stock.

Will Orion Group Holdings (ORN) grant additional options to the underwriter?

Yes, Orion Group Holdings (ORN) expects to grant the underwriter a 30-day option to purchase additional shares of common stock offered in the public offering.

Is the completion of Orion Group Holdings' (ORN) proposed stock offering guaranteed?

No, the offering is subject to market conditions, and there is no assurance as to whether or when the offering may be completed, or as to the final size or terms of the offering.