TomTom To Raise E430m For Debt Payback, Share Prices Down 7.5%
Reeling under the pressure of heavy debt, TomTom’ move to raise E430 million through a share issue has hit the company hard. Amsterdam's blue chip index reacted sharply to the company’s plan to raise capital, as shares of the Dutch navigation device maker dropped 7.5%.
However, the company is upbeat and is planning to go ahead with the issue, as it will cut the debt to about E700 million from 1.16 billion at the end of the first quarter.
The company seeks to garner $600 million in order to pay back a part of its E1.16 billion debt accumulated as a result of E2.9 billion Tele Atlas acquisition.
The shares are to be sold through a combination of private placing and a rights issue. The offering would consist of a E359 million rights offering, and a E71 million private placement with two investors, Cyrte Investments and Janivo Holding. The rest is underwritten by Royal Bank of Scotland, Rabobank, ING, Goldman Sachs, and Deutsche Bank, the company said.
Harold Goddijn, CEO, TomTom, said: We have evaluated a number of options over the last months. This was the right structure and also the right timing to do a rights issue.”
Headquartered in Amsterdam, the Netherlands, TomTom is a digital mapping and routing company engaged in the manufacturing of car navigation equipments. The company operates across Europe, North America, Asia, and Australia.
Related Insight
Suppliers Directory
Auto Components Chassis & Suspension Powertrain Paints & Materials
Technology Automobile Technology Testing
Leasing & Insurance
Supply Chain Automobile Distribution Fleet Management
Green Technology Green Vehicles Green Powertrain
Intelligence
“Competing For Share Of Global Automotive Industry Spend In 2010-2011” is a new report published by ICD Research that analyzes how industry suppliers’ media spend, marketing and sales strategies & practices and business planning will be shaped in 2010 to 2011. In an uncertain economic climate this report gives you access to the media channel spending outlooks, media budgets, marketing agency selection criteria, business challenges and sales tactics of leading suppliers to the chemicals industry. The report also identifies automotive manufacturers and suppliers future growth, M&A and investment expectations. The research is based on an extensive survey of senior and C-level industry executives from our market leading panels. Reports Buy online from $2000
Comments may be moderated for spam, obscenities or defamation.