BT rights issue right on target

NEWS BT looks set to meet its £5.9bn target for new cash raised by its rights issue. BT has issued 2 billion new shares to existing shareholders at a discounted price of 300p, representing an acceptance rate of 89.5 per cent. The remainder will be sold at auction for prices in the range of 400p to 445p, the company said. The response to the rights issue has been much better than many commentators predicted. It represents a significant endorsement of the new chairman, Sir Christopher Bland, who announced the cash call shortly after taking over at the end of April. It is also a step forward in the company's battle to reduce its mountainous debt problem, estimated at £30bn before Bland took over.