Aryzta's biggest shareholder, Cobas Asset Management, on Monday called for an extraordinary general meeting to discuss what it called a better funding plan for the Swiss-Irish baker.
Under its alternative proposals, Cobas said it would support a €400 million ($464 million) capital increase – half of what Aryzta’s board wants.
Aryzta's board had called on shareholders to support its plan at the annual general meeting to raise €800 million in new capital to cut debt and restore growth.
"Cobas cannot defend actions that lead to such destruction of shareholder value as would occur through the highly dilutive capital increase proposed by the Aryzta's board of directors," said Cobas, which has a stake of 14.5% in the McDonald's hamburger buns maker.
Cobas had said this month the planned capital increase was excessive and it would present less dilutive measures.
Cobas said it would also ask Aryzta to sell non-core assets, which could raise an additional €250 million.
"Serious expression of interest from third parties for several assets have already been received," the Madrid-based investment company said, adding a deal could be arranged in a "very short time frame".
"This alternative proposal of raising €650 million (€640 million net of expenses) significantly improves the outlook for shareholders in the medium term in comparison to the €800 million (€750 million net of expenses) proposed by the board," Cobas said.
Cobas added it would be prepared to support Aryzta's raising up to €400 million in extra capital in the next 12 months, "if properly explained".
Aryzta was unavailable for immediate comment on the proposals. It shares were down 3.3% by midday.