Thus on track for ScotPower split

THUS has confirmed terms of its debt-for-equity swap with parent Scottish Power, with the telecoms group set to offer 573m new shares at 48p. ScotPower, which is underwriting the offer, will raise its stake in Thus from 50.1% to between 63% and 72%.

ScotPower then plans to demerge the business by handing Thus stock, or a cash equivalent, to its shareholders.

Details of the demerger terms are due on 12 February. The scheme is subject to approval by ScotPower shareholders at a 31 March extraordinary meeting and, if passed, is expected to take place by mid-year. Thus' independent shareholders are entitled to take up about 20.6% of the offer.

The debt-for-equity swap, along with a £90m commercial loan syndicated by the Royal Bank of Scotland, is designed to fund Thus to break even in three years.

Thus said trading was in line with board expectations outlined when it reported interim results on 5 November. Its shares were unchanged at 46 1/2p but ScotPower fell 5p to 418p.