Wolseley mulls £1bn rights issue

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Wolseley, the beleaguered building supplies company, is considering a rights issue to raise funds to help pay down its £3bn debt. The structure of the scheme is yet to be finalised but the group reportedly hopes to raise £1bn through a placing and open offer. "The board of Wolseley confirms that discussions have been held to consider the merits of an issue of new equity and any decisions will be communicated to shareholders through the appropriate channels at the appropriate time," the company told the Stock Exchange.

Wolseley, which also owns the Plumb Center, has watched its share price drop by more than 40 per cent since early 2008, with falling revenues exacerbated by the impact of weakening sterling on income from its main US market. The company has cut more than 7,000 jobs and closed nearly a third of its Stock business branches in the US. The share price closed off by a further 8.7 per cent at 165.4p yesterday.