SIG fell in London trading after saying it’s considering selling shares to raise cash, a move that would help Europe’s largest supplier of insulation and roofing materials avoid breaching loan agreements.
SIG dropped as much as 11 per cent to 105 pence and was changing hands at 116 pence as of 8.42am local time. The company may announce a £300 million ($422 million) rights offer as early as this week, the Sunday Telegraphsaid yesterday, citing an unnamed investor.
European building-materials suppliers, including Wolseley and Saint-Gobain, have announced share sales of more than €5.3 billion ($6.9 billion) in the past month to reduce debt levels.
SIG, which has cut 1,000 jobs and closed 80 branches amid a construction slump in the UK and Ireland, saw its borrowings rise to £710 million at the end of last year, boosted by acquisitions and exchange rates.
SIG is considering “a range of options including a potential equity raising,” the Sheffield, England-based company said today in a statement, responding to media reports.
“A further announcement will be made as and when appropriate.” The stock has fallen 46 per cent since January 12th, the day before the company announced its net debt had increased.
Bloomberg