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back to article DSGi plans £310m rights issue

DSGi is looking to raise £310m through a rights issue to underwrite its continuing overhaul and offset a drying up of credit insurance. The placing was revealed as the firm, which owns PC World, confirmed a slide in revenues and forecast a loss for the year ending May 2 once charges for businesses it is closing are included. …

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  1. Luis Ogando
    Thumb Down

    Surprising?

    DSGi has been on a gradual decline for years. Gone are the heady days of the 80s when it was a major player on the highstreet with over 1,000 stores across 5 businesses (Dixons, Curry's, Supasnaps, Mastercare, and then, later, PC World). They constantly shunted boxes out of stores with little regard for customer service, a knife-point approach to extended warranties and an almost impossible returns policy.

    Like our housing market, they got greedy, over-ambitious and cocky. And now the unfortunate folk paying for it are the sacked workers, while the Top Floor Fatties bail with BIG pay-offs.

    DSGi makes even eBay an attractive place for 'quality' products!

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  2. Nick
    Happy

    Do the shares come with....

    ...a 3 year extended warrantee ?

    (sorry, I'm sure I'm not the first or last)

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  3. Anonymous Coward
    Anonymous Coward

    310Million?

    It sounds like my least favourite "Director of Web development" has gone in there.

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  4. Steve Medway
    Thumb Up

    DSGi going down the pan

    He added, "The refinancing also leaves us well placed to provide reassurance to our trade suppliers and their credit insurers with regard to the group's capital position."

    In other words DSGi owed loads of cash to it's suppliers who are all shit scared DSGi will go bust and not be able to cough up any reddies.......

    DSGi...... going down the tubes, with BestBuy coming to the UK no wonder their trade suppliers are slightly concerned - this ain't a credit crunch issue this is a shit company issue.

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  5. Chronos

    Um...

    In English, please. I don't speak bean counter. At least explain what a "rights issue" is for those of us more practically inclined and unfamiliar with the "make money out of thin air" type fantasy worlds these accountants often inhabit.

    For those like me:

    Rights Issue

    One of the ways that a company can raise additional funds is to issue new shares. These new shares must be first offered to current shareholders and a rights issue allows a shareholder to buy an additional number of shares for each share held. For example, a two-for-three rights issue entitles shareholders to buy two additional shares for every three owned. Rights can be traded in the market.

    (http://glossary.reuters.com/index.php?title=Rights_Issue)

    How the hell does this work? Looks to me like they're diluting their existing shares. To my mind, they're not worth any more than they were before they started, so issuing new shares simply devalues those already held. Am I wrong? Money out of thin air indeed.

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  6. Anonymous Coward
    Flame

    provide comfort to the group's trade suppliers and their credit insurers

    "provide comfort to the group's trade suppliers and their credit insurers"

    It would be a first if they provided any comfort to the customers they rip off!

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  7. Dave Bell

    A common pattern

    There are a few more zeroes in the figures than I ever had to deal with, but I recognise the pattern.

    They've been running their business on money borrowed from their suppliers. That is, get cash as the box goes out of the front door, but pay for it at the last possible moment.

    That's something that's changing. Look at your BT bill: it used to be that you had 28 days after invoice date to pay. Now. with post and bank clearance times, you can be late if the few days you are allowed includes a Bank Holiday weekend,

    Now, not all DSGi is as bad as PCWorld, which I suspect has been playing the monopoly game. If you want a washing machine, or a TV. there are plenty of other sources. But their suppliers have put the pressure on, and if the sales were slower--boxes spending longer in store--it can eat a lot of money.

    Personal computers are even getting into toyshops. When I bought my Eee PC, the best price was at Toys'R'Us. And they were quite comfortable about selling Linux to the kiddies. That's a good example for the threat to PCWorld and its like. How about a Belkin ADSL-modem/router from Tesco?

    Last time I was in PCWorld, a lot of stock was own-brand, and expensive. They're looking backed into a corner.

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  8. Ascylto

    For crap service ...

    DSGi in trouble?

    What they need to do is not go for a rights issue but call in Crapita.

    That'll see 'em off!

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  9. DrXym

    I'm surprised DSGi is even alive

    Currys / Dixons / PC World have never offered value for money, or employed knowledgable staff, or provided decent aftersales support. I can only attribute their continued existence to a percentage of the public not knowing what bad service and value they're getting.

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