GLOBAL - DTZ is planning to raise up to £55m (€59.2m) of equity through new shares in a bid to help the company survive the economic downturn and avoid going into administration.

DTZ revealed on Friday, in its half-year results, the firm has suffered a pre-tax loss of £9m (€9.6m) since the end of October 2007 and an increase in net debt from £33.7m (€36.1m) on 30 April 2008 to £74.6m (€79.9) as by October.

The UK-listed firm said it is aiming to fundraise £52m net of expenses by issuing nearly 204 million (203,772,569) new shares through the ‘Firm Placing and the Placing and Open Offer' at 27p (85 cents) per share, to help "meet its working capital requirements" and pay its debt to the Royal Bank of Scotland.

Tim Melville-Ross, chairman of DTZ , said he hopes the funds raised will enable the group to withstand further market deterioration, keep trading and take advantage of opportunities when the markets recover.

"The Board has concluded that the Firm Placing and the Placing and Open Offer is the only available option for the group and its shareholders that provides timely and guaranteed receipt of necessary funds," said Melville-Ross.

The Royal Bank of Scotland has agreed to amend and restate the terms of DTZ's existing four facilities - three acquisition facilities and a revolving credit facility - so they become one facility agreement but with the condition that the company receives at least £40m (€42.8m) of gross proceeds.

"With the backing of SGP, our lending bank, our shareholders and the resulting timely receipt of funds, we will be well placed to weather the current unprecedented market conditions and to position the Group to capitalise on opportunities once the market recovers," added Melville-Ross.

The Firm Placing and the Placing and Open Offer is conditional on the Subscription Agreement between the SGP Investors and DTZ signed on Friday, but this has already caused shares in DTZ to drop.

On Thursday 18 December, shares opened at 28p at 8am but closed at 23p by the end of business on Friday19.

DTZ is looking to raise a minimum of £37.1m of which £26.9m will be provided by Saint George Participations (SGP), a French private company and DTZ's largest shareholder, with a 28% share. DTZ will appoint three non-executive SGP directors to its board, giving SGP investors an economic interest of between 55.7% and 77.8% in the company.

Frank Piedelièvre, chief executive officer (CEO) of SGP, said the group was "committed to supporting the company in its development."

"In particular, at this time, the SGP group is pleased to be providing the necessary equity support to DTZ to enable it to meet its anticipated working capital requirements," he added.

DTZ intends to offer approximately 104 million Open Offer Shares, representing £28.1m, of which around 18.5m will be offered at issue price to SGP and Paul Idzik, group chief executive.

Institutional investors who are not currently shareholders in the company will be able to apply for Open Offer Shares and these will be allocated if existing shareholders have not fully subscribed to them.

DTZ is currently has over 12,000 employees in offices across 150 cities and operates in 45 countries.