Seat Pagine Gialle, the Italian directory business backed by CVC Capital Partners, Permira, BC Partners and Investitori Associati, is set to raise €200 million via a deeply discounted rights issue.
Pagine Gialle’s private equity backers, which own 50.1 percent of the share capital, will fully subscribe to the rights issue and thus between them will inject €100 million.
The issue price of €0.106 represents an approximate 46 percent discount to the “theoretical ex-right price” of the Seat ordinary shares, according to a statement from the firm. The share price at press time was €1.15.
The rights issue is underwritten by a consortium of banks led by Italian institution Mediobanca and the deeply discounted price was set to “favour the complete success of the share capital increase”, said the company.
The rights issue will put Seat Pagine Gialle in a better position to refinance its debt, a spokesman said in an interview. It has around €550 million of debt which matures in 2012 plus a further €1.3 billion in 2013. In December 2008 it reset its debt covenants with lender The Royal Bank of Scotland.
The four European buyout firms – entitled the Sub Silver consortium – acquired 61 percent of the Seat Pagine Gialle in a deal worth just over €5.56 billion in 2003, after a three month bidding war that involved more than a dozen of the world’s largest private equity firms. In 2004 the now-defunct investment bank Lehman Brothers bought a 12.38 percent stake in the business for €804 million.