Bloomberg are reporting that PPC Ltd. shares plunged after the South African cement maker announced that it was preparing a capital raising of as much as US$256 million, while adding that talks with a credit-ratings agency will probably lead to a downgrade of the company.
The company stock declined as much as 16%, which on a closing basis would be the biggest drop on record, and traded 11% lower at 12.15 rand on Monday. The shares are down 21% for the year, compared with a 3% gain on the FTSE/JSE Africa All Share Index.
The proceeds of the 3 billion rand to 4 billion rand capital raising will be used to reduce debt and fund expansion plans.
Following Gordhan’s resignation, PPC has thanked the outgoing CEO and Executive Director for his contribution to the company and appointed Bheki Sibiya as interim Executive Chairman.