IBC raising 20m pounds to reduce debt

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INTERNATIONAL Business Communications, the debt-laden tipsheet publisher, is raising pounds 20m through a placing and open offer, writes Gail Counsell.

The company's third restructuring in as many years will see its banks, which swapped debt for equity in an earlier reorganisation, cut their stake in the group from 62.8 to 19.6 per cent. IBC intends to use the money to reduce its debts, which should fall from pounds 82m to pounds 15.5m. It also hopes to resume paying dividends.

The company is offering 22.3 million shares at 90p each. The offer, which has been conditionally placed, will be accompanied by a one-for-10 share consolidation. As part of the arrangement the banks have agreed a 30 per cent discount on redemption of IBC's pounds 27m loan stock and will cancel pounds 36.7m of non-interest-bearing debt.

IBC struggled back to profit last year, making pounds 752,000 in the full year. This year it is forecasting first-half pre-tax profits of at least pounds 750,000. The shares closed 3.5p higher at 12p.