Aryzta's biggest shareholder, Spain’s Cobas Asset Management which owns 14.5% of the business, has said the raise is too much and that €400 million is a more appropriate target, reports Irish Examiner.
The Irish-Swiss baked foods group’s shares have reportedly fallen more than 4.4% as a row over the size of the Cuisine de France-owner’s planned capital raise next month deepened.
The McDonald's hamburger buns maker has said it has considered all potential alternatives and called Cobas’s proposal “inadequate” and one which presents “significant execution risk for Aryzta and all of its stakeholders”.
Earlier this month Cobas Asset Management, called for an 'extraordinary' general meeting to discuss what it called a better funding plan for the Swiss-Irish baker.
At the time 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.
Cobas had said this month the planned capital increase was excessive and it would present less dilutive measures.
© 2018 Checkout – your source for the latest Irish retail news. Click subscribe to sign up for the Checkout print edition.