Aryzta shareholders have marginally voted in favour of the struggling bakery group’s capital-raising exercise at an annual general meeting held today (1 November).
The vote went in Aryzta’s favour by 52.88% to 46.98%, according to a statement.
Dual-listed Aryzta first announced the planned EUR800m (then US$910.7m) share offering in August as the financially-troubled Swiss-Irish bakery business sought to bolster its capital structure and cut billions of euros of debt.
However, Aryzta’s plan had been opposed by its largest investor, Cobas Asset Management, which owns 14.5% of the company. The asset manager had proposed an alternative financing exercise that would require less money, and also suggested chief executive Kevin Toland sell non-core businesses. To his credit, Toland had already launched a cost-savings programme entitled Project Renew and initiated a number of disposals.
This morning, the Zurich-based company revealed the finer details of the rights offering that would go before shareholders today, involving the issue of more than 900 million new regulatory shares intended to raise CHF900m, or approximately EUR790m, just shy of the initial target.
In a statement announcing those details, Aryzta said: “The sizing of the capital increase reflects Aryzta’s requirements to obtain the necessary strategic and financial flexibility to implement its strategy, strengthen its balance sheet, provide funding to execute Project Renew and have the ability to maximise the value of non-core asset disposals.
“The proceeds from the capital raise will be used for term loan repayment, funding of the required investments under Project Renew and general corporate purposes including working capital needs.”