U.K. estate agency Countrywide PLC (CWD.LN) said Thursday that it intends to raise 140 million pounds ($183.7 million) in a share issue as it seeks to pay down debt and recover from a major interim loss.
Countrywide said it intends to issue shares at 10 pence each via a placing and open offer. This is an 80% discount to its closing share price of 49.95 pence on Wednesday.
The company said the net proceeds of the issue will allow it to reduce its net debt of GBP211.7 million by 60%. However, Countrywide said it will also have to raise the debt-to-earnings ratio on its credit agreements.
The share issue is conditional on shareholder approval. Countrywide said it already has the support of major shareholder Oaktree Capital Management.
In its half-year results on Thursday, Countrywide reported a pretax loss of GBP242.8 million, driven by noncash exceptional charges for goodwill and asset impairments. Revenue fell 9% to GBP303.6 million, which Countrywide said was due to a decrease in its sales pipeline.
Paul Creffield has been appointed as managing director, and Paul Chapman has been appointed as chief operating officer to lead its turnaround plan, the company said.
Countrywide said operational improvements mean it expects its full-year result to be in line with its expectations.
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