Packaging manufacturer Nampak on Tuesday advised its shareholders of its plan to go to them cap in hand for R1bn cash in a bid to resolve its debt issues.
Nampak has been battling a R5bn debt pile after an ill-fated expansion into the rest of Africa and is now preparing for huge job cuts, salary freezes and a reduction in overtime as it battles a cash crunch that has eroded its share value over the past five years.
It said that as well as the rights offer, management has committed to an asset disposal plan through which it will raise another R2.6bn.
Nampak has received commitments from some major shareholders to follow their rights in the capital raise. The final terms of the rights offer, including the subscription price and the ratio of entitlement, are expected on Thursday.
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