LADBROKES, the book maker, yesterday announced a fully underwritten £275m cash call to pay down its debt, as it revealed its revenue had fallen by 15 per cent in the third quarter due to “exceptionally low” margins on football and horsing bets.<br /><br />The betting firm, which has already had to withheld its interim payments to shareholders due to challenging conditions, said it would raise £275m in a deeply discounted rights issue.<br /><br />The group said the one-for-two rights issue of 3bn shares would be priced at 95p per share – a 48 per cent discount to Wednesday’s closing price.<br /><br />The rights issue will be run by banking heavyweights UBS and Deutsche Bank. Net debt stood at £962m at 30 June, but this could fall to £687m as it refinances its remaining debt and reinforce its balance sheet with extra capital in a tough trading climate.<br /><br />Net debt stood at £962m at 30 June, but this could fall to £687m after the rights issue.<br /><br />Ladbrokes chief executive said Chris Bell said that the group’s cost cuttings efforts were not enough to remove the risk of the debt pile. “There is a sufficient risk that the actions currently being taken will not be enough alone to reduce net debt to a level which it considers to be appropriate within the required timeframe.”<br /><br /><strong>DEUTSCHE BANK AND UBS: ADVISERS TO LADBROKES</strong><br /><br />BETTING firm Ladbrokes enlisted its long-term advisers UBS and Deutsche Bank to run the rights issue.<br /><br />Head of UK investment banking Tim Waddell runs the advising for UBS along with colleague Bill Hutchings.<br /><br />Deutsche Bank’s head of broking Charles Wilkinson and Edward Sankey, head of European equities, was also on the deal.<br /><br />Wilkinson and Sankey are both long term employees of Deutsche Bank.<br /><br />Boutique broker Greenhill is also acting as financial adviser.<br /><br />UBS Investment Bank and Deutsche Bank are acting as joint sponsors, joint bookrunners and underwriters.<br /><br />Barclays Bank, Lloyds TSB Corporate Markets and RBS Hoare Govett are acting as co-lead managers and underwriters<br /><br />Wadell has been working at UBS’s broking division for the past twenty-four years. Wadell is also currently working on the broking side for Cadbury since it received a potential takeover offer from Kraft. Hutchings joined the bank in 2000. Ladbrokes chief executive said that the rights issue will strengthen the group’s financial position and put in place a more conservative capital structure.