:. Food Industry News

Categories: Corporate Results

Danone Plans $4.2 Bln Rights Issue

Source: Reuters
26/05/2009

Paris, May 25 - Danone plans to raise about 3 billion euros ($4.2 billion) by selling shares to existing shareholders to reduce net debt, the French food group said on Monday.

Daily News Alerts

The company expects to launch the rights issue in the coming days, subject to internal and regulatory approvals, co-Chief Operating Officer Emmanuel Faber told reporters on a conference call.

"The proceeds of the rights issue will be used principally for the reduction of Danone's net financial debt," Danone said in a statement.

The move will also enable the company to strengthen its capital structure and increase its flexibility to support organic growth and fund small and medium-sized acquisitions, Danone said.

The group's ratio of debt to core earnings (earnings before interest, tax, depreciation and amortisation) will decrease to 1.7 from 2.8 after the rights issue, Faber said.

The company also reiterated its full-year target for like-for-like sales growth of a few points below its medium-term guidance of 8-10 percent and a like-for-like improvement in its operating margin.

Danone stuck to its forecast for underlying, fully diluted earnings per share at constant exchange rates to rise 10 percent this year, excluding the dilutive effect of the issue of new shares.

The move follows a 1.04 billion euro rights issue by French spirits group Pernod last month to help cut its more than 12 billion euros of debt. The company offered shareholders a 36 percent discount.

French cement group Lafarge and building materials group Saint-Gobain have also launched rights issues of 1.5 billion euros this year, with deeper discounts.

Faber said Danone would fix terms for its rights issue when it was launched.

Danone shares rose 1.2 percent on Monday to 39.615 euros, giving the company a market value of around 20 billion euros. The stock is down around 9 percent so far this year.

Danone is being advised by JPMorgan and Calyon, it added.





GO   View more articles on this subject


More Alerts from 26/05/2009


Email This Article To A Colleague     Print A Copy Of This Page
 
 
 
 
FLEXNEWS - Business News for the Food Industry

About Us | Contact Us | Terms & Conditions | Privacy Policy
 
Daily News Alerts
Related Items
Danone to Get Slimmer Premium in Tougher World
Danone Q3 Sales Seen 0.8 Percent Lower
Danone Ends Wahaha Dispute, to Sell China JV Stake
Danone Says Not Holding Talks with Mead Johnson
USA: Dannon Company Settles 2008 Class Action Lawsuit...
Danone Testing Powder-Form Yoghurt in Brazil; Considering...
Danone Launches Activia in South Korea; Sees Huge Growth...
Kraft's Cadbury Bid Whets Appetite for Food Stocks
Britannia Gets 220 Mln Rupees from Danone to Settle...
Nestle H1 Organic Sales Growth Seen at 3.9 pct

More in Food Industry News
USA: Kehe Food Distributors Opens New Centre in Pennsylvania
Russia Duma Passes Beer Tax Hike in First Reading
Bongrain's Slowdown in Cheese Sales Continues as Group's...
Cadbury Descendant Fears Loss of Firm's UK Heritage
Sugar, Coffee Sideways, Eye Storm in Nicaragua
Ahold Set to Benefit Whether Predator or Prey
First UTZ CERTIFIED Cocoa to Be Delivered in Amsterdam,...
GLG Life Tech to Offer 3.6 Mln Shares for US IPO
Sainsbury H1 Profit Seen up 16 Percent, H2 Tougher
EU to Fight for Tuna Protection at Global Talks

Top Headlines
USA: Kehe Food Distributors Opens New Centre in Pennsylvania
Russia Duma Passes Beer Tax Hike in First Reading
Bongrain's Slowdown in Cheese Sales Continues as Group's...
Ahold Set to Benefit Whether Predator or Prey
GLG Life Tech to Offer 3.6 Mln Shares for US IPO
Sainsbury H1 Profit Seen up 16 Percent, H2 Tougher
UK: Continual Growth at Graham's The Family Dairy During...
Ajinomoto H1 FY09 Net Income Increases
Hain Celestial Reports Lower-than-Expected Quarterly...
AarhusKarlshamn's Food Ingredients Quarterly Operating...
SunOpta Q3 Revenue Drops 11.8%
Jones Soda Sees Revenue Decrease of 18% in Q3
UK: Tate and Lyle's Pre-tax Profits £112 Million...
Cha Dao Tea of Seattle Partners with BYB Brands
Coca-Cola Bottling Co. Consolidated Sees Income Growth...
California Pizza Kitchen Profit Up, Forecast Light
Starbucks Raises Outlook as Turnaround Signs Mount
Senomyx Quarterly Revenue Increases 3%
China: Yayi International to Build China's Largest...
Discovery of Pesticide Amitraz in Turkish Pears: EU...
Dr Pepper Snapple Profit Tops View
Sara Lee Reports Strong Fiscal 2010 First Quarter;...
Ahold Gears Up for M&A with Management Rejig
ICA AB Interim Report 2009: Net Income up 7.5 Percent
Process for Preparing a Highly-Soluble Cocoa Extract
Methods and Compositions for Improving the Nutritional...


 


FLEXNEWS 2009 - All rights reserved
ISSN 1950-6228