HeidelbergCement has decided to carry out a capital increase to raise Euro 500m in cash to partly refinance its takeover of Britain’s Hanson Plc .
VEM, part of German billionaire Adolf Merckle’s group, who owns majority control of HeidelbergCement, would subscribe for around 4.4 million new shares at a price of 114 euros per share.
"The new shares are entitled to receive dividends for the entire business year 2007," HeidelbergCement said on Tuesday. It expected to receive the proceeds from the capital increase "shortly".
Shares in HeidelbergCement closed 0.1 per cent lower at 118.25 euros on Tuesday.
HeidelbergCement said last week it had agreed to buy Hanson for 8 billion pounds ($15.78 billion) to create the world’s second-largest company in construction materials. The cash offer of 1,100 pence per share would be the biggest takeover in the sector and creates a building materials company with a market value of $34 billion, leapfrogging Lafarge and challenging top-ranked Saint Gobain .
HeidelbergCement aims to complete the deal in the third quarter and finance it with up to 2 billion euros of hybrid capital, and by selling debt and selected non-core assets.