Arytza shares will be reduced by more than 11pc as the company seeks to raise up to €800 million in capital, primarily to repay debt

  • Arytza shares will be reduced by more than 11pc as the company seeks to raise up to €800 million in capital, primarily to repay debt
    Independent.t. E.
    Shares of the embattled Swiss-Irish food group Aryzta, which owns the brand cuisine de France, fell more than 11pc in Dublin in early trading as the company reported that it plans to raise up to €800m in capital, primarily to repay debt.
    https://www.independent.ie/business/irish/arytza-shares-fall-by-more-than-11pc-as-company-aims-to-raise-up-to-800m-in-equity-to-primarily-repay-debt-37210328.html
    https://www.independent.ie/business/article37185484.ece/87b0f/AUTOCROP/h342/2018-08-05_bus_43012218_I1.JPG

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Shares of the embattled Swiss-Irish food group Aryzta, which owns the brand cuisine de France, fell more than 11pc in Dublin in early trading as the company reported that it plans to raise up to €800m in capital, primarily to repay debt.

The cash call will see stakes in firms owned by shareholders who do not participate in fundraising significantly diluted.

“The significant improvement in capital structure will provide Aryzta funds to continue to take the necessary action to change the state of the business and implementation of our strategy,” said CEO Kevin Toland, who was parachuted in last September, to help turn the ailing group around.

He added: “in the medium term, we expect to generate significant cash flow that will be used to further reduce net debt and selective growth opportunities resources.”

The money the group plans to raise will primarily be used to reduce debt.

Mr. Toland has faced serious problems in obtaining Aryzta on the rails, and now threatening challenges, including the likelihood of increased costs for raw materials, and wheat prices are rising after the summer heat.

Bank of America, Merrill Lynch and UBS were appointed banks process and the joint global coordinators for the planned stock to raise. Credit Suisse and JP Morgan were appointed as joint global coordinators for the organization to increase the authorized capital.

Aryzta said that trading in the fourth quarter of the financial year in line with expectations. It plans to establish full-year earnings before interest, tax, depreciation and amortisation (EBITDA) in the amount of 296m and €304m.

He also was in compliance with its covenants in its last full fiscal year.

“Aryzta remains committed €1 billion of borrowings purpose for four years (before the announcement of the capital raising), including at least €450 million disposal proceeds and the remainder from cash flow generation”, he added.

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