Italy's RCS Sets Ordinary Share Price of Rights Issue at EUR1.235

Italy's RCS MediaGroup SpA (RCS.MI) said late Thursday it would offer three new ordinary shares for every existing ordinary share at a price of 1.235 euros ($1.65), for up to EUR400 million, in a recently approved rights issue.

The indebted Italian publisher, which on Thursday approved the final conditions of a capital increase of up to EUR421 million, also said it would offer three new savings shares for one existing savings share at a price of EUR0.268 each, for up to EUR21 million.

RCS shares closed at EUR3.8 Thursday.

In a filing to the Italian stock exchange, RCS added that EUR380 million of the rights issue has already been guaranteed, thus meeting a condition necessary to access several credit lines from a number of Italian banks.

In fact, the banks, acting as joint global coordinators and guarantors of the operation, have agreed to subscribe up to EUR184.5 million of the unbought ordinary shares of the rights issue, while shareholders have committed to subscribing EUR195.5 million of it.

Last month the Italian publisher--which controls Italy's most influential daily, Corriere della Sera--approved a EUR600 million capital increase to finance its new strategy plan and guarantee banks' credit lines.

The banks involved are Intesa Sanpaolo (ISP.MI) UBI Banca (UBI.MI), UniCredit (UCG.MI), Italy's branch of BNP Paribas (BNP.FR), Banca Popolare di Milano (PMI.MI) and Mediobanca (MB.MI), RCS previously said.

In an attempt to cut costs and improve financials, the company also is trying to sell 10 of its magazines and said that should it fail to find a buyer, it will close the magazines by the end of June. It is also planning to lay off around 800 people.

RCS Mediagroup has been struggling with losses recently as its net debt stood at EUR1.17 billion at March 31 and its gross operating loss was EUR84 million in the first quarter.

RCS Mediagroup's stakeholders include Fiat SpA (F.MI), Assicurazioni Generali (G.MI), Intesa Sanpaolo and Mediobanca.

Write to Enza Tedesco at [e-mail] and Manuela Mesco at [e-mail]

Subscribe to WSJ: http://online.wsj.com?mod=djnwires