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Article: Illovo to reduce debt risk by issuing rights.(Business Report)
- Article from:
- The Star (South Africa)
- Article date:
- May 28, 2009
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BYLINE: Samantha Enslin-Payne
Illovo Sugar would raise funds for its expansion through a rights offer to reduce its reliance on costly bank finance, managing director Graham Clark said yesterday.
The international financial crisis had made the group uneasy with its heavily geared position despite the fact that it had strong cash flow.
In the year to March the group made strong cash operating profit of R1.2 billion. But group borrowings increased sharply to R2.4bn from R1.2bn due to expansion projects, which pushed up its debt to equity ratio to 70 percent from 40 percent.
Clark said in the current climate it was risky to rely solely on ...