Sir Anthony O'Reilly and his brother-in-law, Peter Goulandris, will receive commission of €2 million for underwriting Waterford Wedgwood's €101.5 million rights issue.
The two men, whose family interests control nearly 25 per cent of the china and crystal group, are fully underwriting the 7-for-11 rights issue, which aims to raise €96.5 million after expenses for the troubled company.
According to the rights issue document, which was published and posted to shareholders yesterday, the expenses of the rights issue will be around €5 million.
Of this, €2 million comprises commission payable under the underwriting agreement.
Sir Anthony and Mr Goulandris have received approval from both the Irish Takeover Panel and independent shareholders to increase their stake in the group to a maximum of 53.9 per cent without making a bid for the company, in the event that they have to fully support the issue.
The proceeds of the rights issue will be used to implement a €90 million cost restructuring programme and to improve the group's liquidity position.
The cost restructuring programme will see capacity reduction of around €30 million, overhead reductions of €24 million and the further integration of Waterford Wedgwood and Royal Doulton at a cost of around €36 million. The balance of around €6.5 million will be used for general working capital purposes.
The effect of the restructuring will be to cut 1,800 jobs at the company. This includes a reduction of 485 in the numbers employed at Waterford Crystal, while 160 workers will leave Rosenthal and a further 200 will depart the wider group. The numbers at Wedgwood and Royal Doulton are expected to be cut by 950, with around 450 of these having already left the business since January.
Shares in Waterford Wedgwood closed at the rights issue price of €0.06 last night, valuing the company at around €160 million. The closing date for acceptance of the rights issue is July 18th.
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/VR3765MFOBH2NMV2QNICYDF67M.png)