Spanish retailer DIA has announced that it has completed a capital increase process for a total of €1,028 million.
Out of the total, €769 million is a result of the conversion of the company's debt into equity by LetterOne, and the remaining €259 million corresponds to the monetary tranche of the capital increase to minority shareholders. All of the 12,927,555,100 new shares in said tranche have been subscribed, the company said.
In March of this year, the retailer agreed to convert debt owed to its main shareholder LetterOne into equity and additionally offer new shares to existing shareholders for a total €1,028 million ($1.21 billion).
According to DIA, the demand for the cash tranche exceeded the supply of the new shares offered by 1.67 times. This represents a total demand of approximately €433 million.
The capital increase process provides the retailer with an optimal capital structure, represents a new injection of liquidity that will accelerate the transformation process of the group, and eliminates the negative equity situation the company was in, thus preventing it from incurring legal cause of dissolution.
Stephan DuCharme, executive president of DIA Group, commented, "The successful completion of the capital increase clearly demonstrates the confidence that the DIA Group project is generating in all its stakeholders.
"I would like to thank all the shareholders, both those who were already present in the capital and the new investors, for their support of this process, especially in the second tranche. The company will now be able to focus exclusively on developing the business that it has already started and which has begun to pay off."
© 2021 European Supermarket Magazine. Article by Conor Farrelly. For more Retail news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.