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Imperial Tobacco in shock ?4.9bn rights issue
Imperial Tobacco stunned investors today as it launched a ?4.9 billion rights issue to help pay for last year's bumper acquisition of Altadis, the Spanish cigs maker.
The deal is one of the largest in UK corporate history and comes as a growing list of British companies take the begging bowl to existing shareholders for much-needed cash. Proceeds will help pay off some of the debt associated with the acquisition, which completed in January.
At the same time, the world's fourth largest cigs group reported a 45 per cent slide in first half profits, down from ?421 million to ?233 million for the six months to the end of March as it faced up to difficulties integrating the acquisition. Shares slid 62p to ?25.56, a fall of almost 2.4 per cent, in early trading.
The issue is fully underwritten by Morgan Stanley, Lehman Brothers, Citigroup and Hoare Govett. Royal Bank of Scotland, the banking group, is asking investors for up to ?12 billion, while HBOS, which owns Halifax, has launched a cash call for ?4 billion.
Johnston Press, the regional newspaper group, last week said it would try to raise ?212 million by offering new shares to existing owners. Imperial, which makes Lambert & Butler and Gauloises brands, is offering one share for every existing share at ?14.75 each.
This is a deep discount of 43 per cent to last night's closing price of ?26.18 but is similar to the basement prices on offer elsewhere.
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