Extract from rights issue doc - main reason is for repayment of holding company loan account as presumably they do not generate sufficient free cash flow to repay it from the business. So shareholders are effectively being asked to repay daddy - It is intended that the funds raised from the ArcelorMittal Group under the Rights Offer, will be first used to settle ArcelorMittal Group loans up to a maximum of R3.2 billion, with any balance being retained for operational and near-term capital expenditure purposes. This will allow the Company to optimise its financial position before embarking on its extended R4.5 billion capital programme over the next five years. Apart from the ArcelorMittal Group loans, there is no other material long-term debt outstanding.
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