Danone Seeks EUR3bn Through Rights Issue

France-based Groupe Danone has announced plans to raise EUR3bn (US$4.2bn) through a rights issue. The money raised will be used to pay down debts and give the firm the leeway to fund small- and medium-sized acquisitions. Danone is saddled with debt of EUR11bn following its acquisition of Dutch baby-food maker Numico in 2007, which was only partly offset by the EUR5.3bn sale of its European biscuit division to Kraft Foods. The call for cash came as an unwelcome surprise to investors with Danone's shares falling by 7.5% shortly after the

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