By Inti Landauro
PARIS--Technicolor SA (TECH.FR) will start selling as much as
191 million euros ($233.3 million) worth of new shares to equity
fund Vector Capital Group on Monday to raise cash to reduce its
debt and reorient the company from its unprofitable set-top-box
business.
The capital increase, in which Vector will receive 18% to 29.94%
of Technicolor's equity, was approved in late June by Technicolor's
shareholders after a bidding war between Vector and U.S. bank
JPMorgan Chase & Co. (JPM).
The operation will be carried out through two capital increases.
A first one reserved to Vector, which will pay EUR2 per share, and
a second one, due to open July 18 and close August 2, in which
Vector has the right to buy as much as 75% of the shares put for
sale at EUR1.56 a share, Technicolor said Friday.
Technicolor, which takes its name from its iconic U.S.
media-processing division, has been struggling, especially its
set-top-box business in France. The capital to be injected by
Vector will allow Technicolor to focus on other businesses such as
digital media services, where the company holds numerous
patents.
Technicolor will also use part of the new equity to reduce its
net debt of about EUR1 billion.
The French government has said it is closely monitoring the
situation at Technicolor because the company has said it might need
to sell or close one of its French factories that makes set-top
boxes.
Write to Inti Landauro at inti.landauro@dowjones.com