Origin Energy covers $1.13 billion of $2.3 billion share issue

Origin Energy will move to the second stage of its $2.3 billion capital raising after strong support from institutional shareholders this week.

The company said that 95 per cent of shares offered to institutional investors had been taken up, raising $1.13 billion to help cover debts associated with buying electricity assets from the New South Wales government.

Origin said it would make the same 1-for-5 offer priced at $13 to retail shareholders, allowing them a 17 per cent discount to Origin's last traded price on Monday.

Despite gas stocks being popular this week following Japan's nuclear crisis, the capital raising helped drag Origin's share price down 26¢, or 1.7 per cent, to $15.40.

Retail shareholders can take up the offer from Monday and analysts say that could result in almost 36 million shares or rights being disposed of in the coming weeks.

Analysts expect Origin to have another capital raising this year to fund its Australia-Pacific LNG joint venture with ConocoPhillips.