Feb 8 (Reuters) - Britain’s Investment Association said on Thursday that TalkTalk raising cash from investors through a placing was “a blatant disregard of the industry-accepted standards”.
The Investment Association is the trade body that represents UK investment managers.
Broadband provider Talk Talk said it would raise up to 200 million pounds ($278.46 million) in a placing to help fund a plan to connect three million British homes and businesses with ultrafast broadband and keep it competitive with bigger rivals.
The Investment Association said the company’s placing of its shares representing 19.99 percent of its existing share capital on a non-pre-emptive basis ignored shareholder rights.
“Pre-emption rights are a vital shareholder protection and their misuse poses a serious threat to shareholder and investors’ interests - the UK’s pensioners and savers,” an Investment Association spokesperson said in a statement.
TalkTalk could not be immediately reached for comment.
The company also cut its full-year earnings forecast on Thursday and said it would slash its dividend to help fund the new network and rebuild its customer base. ($1 = 0.7182 pounds) (Reporting by Abinaya Vijayaraghavan in Bengaluru, Editing by William Maclean)