// WHSmith launches equity fundraising to overcome coronavirus-related decline
// It is in preparations for a share placing representing a maximum of 13.7% of its issued share capital
// This means it could raise between £200 million and £300 million to shore up its balance sheet
WHSmith is reportedly planning to tap investors to help raise cash through an equity issue in a bid to overcome the financial impacts of the coronavirus lockdown.
The books and stationery retailer said it was at an ”advanced stage” of preparations for a share placing representing a maximum of 13.7 per cent of its issued share capital.
This means it could raise between £200 million and £300 million through the share placing in order to shore up its balance sheet.
The news comes as WHSmith’s share price dropped 58 per cent in the last six weeks, cutting its value to £1.2 billion.
Listed companies can raise up to 19.9 per cent of their capital without requiring shareholder consent.
The equity raise would make WHSmith one of the first major retailers to turn to investors for a cash injection after its stores were hard hit by lockdowns, especially its profitable lucrative travel retail division.