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Shopping firm eyes second cash call

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Home shopping firm Findel said it was considering plans to raise £80 million in its second cash call

Loss-making home shopping firm Findel said it was considering plans to raise £80 million in its second cash call to shareholders in as many years.

The group, which owns Express Gifts and sells football shirts for Everton football club through its Kitbag business, hopes to use the money to pay down some of its £336.8 million debt and to fund a new back-to-basics recovery plan.

It raised £81 million through a rights issue in August 2009 but is looking at plans to launch more shares on the market as part of a proposed five year refinancing deal agreed with its banks.

The plans have not been finalised but negotiations with lenders are in advanced stages and Toscafund and Schroders, which control more than 50% of the stock, have backed the deal.

Bradford-based Findel has revealed it reduced its pre-tax losses by 32% to £15.5 million in the half-year to 1 October, on sales down 3.5% at £264 million.

It plans to invest £35 million as part of a strategy that will see every part of the business grow over the next three or four years, it said.

The launch of the strategy follows a difficult year for the company, which was forced to restate its results after it discovered fraud in its education supplies business.

It appointed Roger Siddle as its new chief executive in July after he was drafted in as a consultant to carry out a full review of the business, which concluded that previous problems were caused by underinvestment.

Former chief executive Philip Maudsley remains managing director of the home shopping division.

Under the new strategy, its mail order shopping company Express Gifts will receive a £7 million investment in new computer systems, better credit checks to weed out customers likely to default on payments and will offer sharper prices to consumers.

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