South African investment firm Brait, which owns stakes in New Look, Iceland and Virgin Active, has announced a financial restructuring plan that will see it offload its assets.
Shares in the Johannesburg-listed company plunged more than 15 per cent after it unveiled plans to sell off its assets in a bid to reduce debts and announced a major rights issue.
Read more: New Look losses shrink despite dip in sales
Brait also said it will launch an equity capital fundraiser for up to 5.6bn rand (£300m) as it seeks cash to pay off debts that mature next year.
The company said that Ethos private equity has agreed to invest 1.35bn rand in Brait, adding that its advisory board going forward will include some existing corporate advisers and Ethos executives.
“The board has resolved to adopt a new strategy that will focus on maximising value through the realisation of its existing assets in the portfolio over the next five years and returning capital to shareholders,” the company said.
Brait chairman Jabu Moleketi said: “Today Brait announces its recapitalisation comprising a fully underwritten equity capital raise, refinancing of the group’s revolving credit facility and launch of a new convertible bond.
“The aggregate amount of the recapitalisation, of between 14.4bn rand and 14.7bn rand, provides a holistic solution for Brait to enable the redemption of the existing £350m convertible bond maturing in September 2020, as well as refinancing the group’s revolving credit facility for a revised three-year tenor.”
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