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Travis Perkins set for £300m fund-raiser
Northampton-based builders' merchant Travis Perkins is expected to turn to shareholders in a £300m fundraising this week.
The rights issue would allow Travis to pay down some of its 1bn debt, as well as give it flexibility for possible future acquisitions.
More cash calls are expected in the coming weeks as firms across the London market look to repair or bolster their balance sheets.
As well as speculation over Travis Perkins, newspaper reports this weekend said Debenhams and housebuilder Redrow were mulling the offer of new shares.
Housebuilder Taylor Wimpey and private equity firm 3i stepped forward on Friday with initiatives to raise 510m and 700m respectively. The pair said they were keen to position themselves for future investment opportunities, particularly at a time of depressed valuations.
The second wave of rights issues follows fundraising moves earlier this year by the likes of HSBC, William Hill and a number of property companies.
The Sunday Times said the rights issue by Travis Perkins, which could be announced to the stock market on Monday, was likely to be welcomed by investors.
It said some analysts had been concerned that Northampton-based Travis was close to breaching its banking covenants. The move will ensure Travis continues to pay low interest on its debt for the next four years at a time when many UK companies have had to renegotiate debt facilities on more onerous terms.
Meanwhile, the Financial Times said Debenhams was looking to cut the department store chain's 1bn debt burden by raising between 300 million and 500m. The company's hopes of a successful fundraising have been lifted by strong half-year results and an upbeat trading statement.
And the Independent on Sunday reported that Redrow founder Steve Morgan, who returned to the company in March, could tackle the housebuilder's 269m debt with a capital raising. A decision over a rights issue is likely to be made in the next two months.
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Thursday 24 May 2012
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