DUNSTABLE (dpa-AFX) - British restaurant company Whitbread plc (WTB.L) said Thursday it proposes to raise gross proceeds of about 1.009 billion pounds by way of a 1 for 2 fully underwritten rights issue.
Whitbread said the rights issue is intended to ensure that it emerges from the COVID-19 pandemic in the strongest possible position to take advantage of its long-term structural growth opportunities as well as win market share in both the United Kingdom and Germany. The rights issue is expected to raise 980 million pounds, net of expenses.
The rights issue is fully underwritten by J.P. Morgan Cazenove and Morgan Stanley, both of which are acting as joint global coordinators.
Whitbread noted that since the onset of the pandemic, it has taken action to reduce cash outflows through a broad range of measures. This includes reducing discretionary costs, postponing non-committed development and non-essential maintenance capital expenditure, and utilising the Coronavirus Job Retention Scheme to provide wage costs for furloughed employees.
In addition, Whitbread has been confirmed as an eligible issuer under the CCFF, with an issuer limit of 600 million pounds. The Group has also obtained waivers until 2 March 2022 of the existing financial covenants under its financing and pension arrangements, which have temporarily been replaced with debt and liquidity covenants.
Whitbread said it retains significant liquidity, with cash of approximately 300 million pounds as at 15 May 2020 and access to the 950 million pounds revolving credit facility, of which only 50 million pounds has been drawn.
The company's board believes this will support its business through the COVID-19 pandemic.
Copyright RTT News/dpa-AFX