Shareholders in troubled luxury goods company Waterford Wedgwood have approved a plan to raise another €100 million through an issue of preference shares at an extraordinary general meeting yesterday.
This is Waterford Wedgwood's fifth rights issue or open offer since 2003, raising €400 million for the company.
Chief executive Peter Cameron said he was confident that the group's earnings before interest, tax, depreciation and amortisation (Ebitda) would be positive for the year to the end of March 2007. This would be an improvement of at least €30 million on the year to the end of March 2006, when the china and crystal maker recorded an Ebitda loss of €31 million.
Mr Cameron hinted yesterday that the improvement in earnings would be higher than €30 million.
The company is currently in a closed period until the publication of its annual results in June and is restricted in the level of trading updates it can give.
Group chairman Sir Anthony O'Reilly and deputy chairman Peter Goulandris will take up their 51 per cent share of the allocation and have agreed to underwrite the rest of the offer.Shareholders also gave the company approval to raise an additional €100 million worth of preference shares at a later date, taking the total sum that may be raised to €200 million.
A major part of the proceeds will be used to fund the transfer of production in its ceramics operations to the company's lowest-cost manufacturing facility in Indonesia. Some of the funds will also be invested in its flagship plant in Waterford.
Mr Cameron said the restructuring programme was on track to deliver savings of €90 million for the last financial year.
He said Waterford Wedgwood was on the path to becoming a healthy company. "We have made the products more relevant, we have arrested the sales decline and we have achieved a significant improvement in gross margin," he told sceptical shareholders, one of whom challenged Mr Cameron to answer in plain English whether the company was bankrupt or not.
One shareholder said a €30 million improvement in Ebitda earnings was "chicken feed" compared to its debts, which were €400 million at the end of December.
The company found it was unable to access further bank borrowings, prompting its chairman and deputy chairman to step in to offer fresh security on borrowings of €30 million.
