Future Network plans £33m rights issue as debts mount

Future Network, the loss-making UK publisher, yesterday unveiled plans to launch a rights issue to raise £33m in the face of mounting debts.

The group also said it had cut 39 per cent of its 2000-strong workforce in the UK and US and closed or sold 39 magazines since the start of the year.

Future Network will offer six shares for every five currently owned at 20p each. It hopes to raise £34.6m before expenses, which would be used to pay off some of Future Network's £78m of debt.

Its shares, which have lost 83 per cent of their value this year, were suspended before trading opened and ahead of yesterday's statement.

Greg Ingham, chief executive, said: "There have been queries about our debt, but this should sort out our capital structure. There has been a good response from our larger shareholders, who I am very grateful to as it has been a tough time for them."

Mr Ingham also said he has beefed up the board with Roger Parry, who is also chairman of Johnston Press, becoming chairman of Future Network. The company's current chairman and founder, Chris Anderson, will become a non-executive director.

The group reported a pre-tax loss of £106.7m in the six months to 30 June, compared with a £14.2m loss last year, as revenue on continuing operations fell more than 10 per cent to £70.3m.

Future Network said, as part of the restructuring, most of its internet activities had been scrapped. The total cost of the restructuring and refinancing was about £8m.

Future Network publishes the Sony PlayStation 2 magazines in Britain and Italy, and has suffered in the global slowdown in the computer games market.