BET in cash call to redeem Amps

BET, the services company, has called on shareholders for pounds 201m to replace most of its dollars 500m ( pounds 260m) of preferred shares.

The decision to redeem its auction market preference shares (Amps), which are traded in the United States, will substantially reduce the size of the market in Amps in non-US companies.

Other UK companies, including English China Clays, have already redeemed their Amps. Those with outstanding Amps include Cadbury Schweppes, Redland and Ratners.

The Amps market has fallen out of favour, with the cost of dividends on the preference shares rising above the levels of interest payable on commercial paper.

BET is raising pounds 210m in a one- for-four rights issue at 110p. Its existing shares dropped 4p to 129p yesterday, suggesting that the rights issue, which is underwritten, would be well supported. 'Sensible but uninspired' was one observer's verdict.

BET intends to redeem the outstanding dollars 120m Amps 'at an appropriate time'.

Amps became a popular form of financing in the late 1980s when advisers believed they would allow companies to raise money without diluting the interests of existing shareholders.

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