16 Mar 2009

Nuplex to raise capital by share placement, rights issue

1:58 pm on 16 March 2009

Nuplex Industries is planning to raise $110 million of new capital to reduce its debt, while its bankers have agreed to amend its banking covenants.

The resins maker breached the terms of its debt facilities late last year, which it says was due to the sharp depreciation of the New Zealand dollar.

Its banks have agreed to relax its senior debt cover ratio subject to a number of conditions, including that dividend payments do not exceed 60% of net profit.

Nuplex managing director John Hirst says the dividend repayment restriction is not inconsistent with what it has paid out in the past.

The company is planning to raise capital through a share placement and a rights issue.

It is currently on a trading halt pending a book build, after which it will detail how much it will seek through the rights issue.