Imperial gets rights issue support

Lambert & Butler cigarette maker Imperial Tobacco today said it had secured the backing of investors for its £4.9bn (€6.2bn) cash call.

The company announced that 97.19% of investors agreed to buy shares under its fully underwritten one-for-two rights issue at 1475p each.

Imperial is raising the cash as part of a move to repay debt after its £11bn (€13.9bn) buyout of Spanish firm Altadis, which owns brands such as Gitanes.

As a result of the push to tackle debt, Imperial Tobacco said it would be able to maintain its investment grade credit rating and its dividend policy.

Imperial recently reported profits from operations of £918m (€1.2bn) for the six months to March 31, an increase of 38% after benefiting from a contribution from Altadis following the acquisition in late January.

However, bottom-line profits reduced to £326m (€413m) – a drop of 44% – when restructuring costs and one-off accounting measures are included.