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Mothercare to raise £100mn & fund strategic plan
25
Sep '14
Mothercare plc, the largest UK specialist retailer in its segment, said it will raise some £100 million through a rights issue and which will be £95 million, net of expenses.

The rights issue is a fully underwritten 9 for 10 rights issue at a price of 125 pence per new ordinary share, the retailer said.

The issue price represents a 34.2 percent discount to the theoretical ex-rights price of a share, when calculated by reference to the closing price of 248.25 pence per share on Sept 22.

Mothercare also added that the rights issue price also represents a 49.6 percent discount to the closing price of 248.25 pence per share also on Sept 22.

According to Mothercare, the rights issue is intended to enable the Group to deliver on its new strategic plan designed to turnaround its UK business.

The funds are also expected to transform the Group into a digitally-led business, supported by a modern store estate, well-invested IT systems and an efficient operational infrastructure.

Underpinned by this new strategic plan, Mothercare directors believe that it will then be able to unlock the value of its already successful global business and buttress its future growth.

The retailer will also repay a significant amount of its outstanding debt from the issue proceeds and offer it with a stronger capital base.

Mothercare plc is the largest UK specialist retailer in its segment and has nearly 1,500 Mothercare and ELC stores spanning approximately 60 countries. (AR)

Fibre2fashion News Desk - India


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