Small print in the Countrywide rescue plan announced yesterday spells out in stark terms what could happen if the company’s bid for up to £140m additional funding either fails or is rejected by the company’s shareholders at a meeting scheduled for August 28.
Peter Long, executive chairman, has told Estate Agent Today that he is “delighted” that investors will buy the shares in the new investment, which will be heavily discounted.
The fundraise will generate proceeds of £129m after fees; if this sum is raised it will be used to pay off around two thirds of Countrywide’s current £200m debt.
The firm’s biggest backer - Oaktree Capital which has a 30 per cent stake - has already agreed to the deal but a largely unreported statement at the very end of the 35-page trading update and recovery plan released yesterday makes sombre reading, and sets out what happens if shareholders do not support the deal.
The statement comes from chartered accountacy group PricewaterhouseCoopers, which has Countrywide as a client.