South African retailer TFG Limited priced its 3.95 billion rand ($237 million) rights issue at a 40.6% discount on Thursday as it pressed ahead with plans to reduce debt to cope with the coronavirus crisis.

The owner of the Foschini and @home chains said in a statement it would offer 40 new shares for every 100 ordinary shares held at an issue price of 41.90 rand.

The discount is to the 30-day volume-weighted average price of TFG shares as at 15 July. The offer price represents a discount of 32.8% to the theoretical ex-rights price, or the projected price after the rights issue, the firm added.

TFG needs the proceeds to invest in its growth strategy, e-commerce and the proposed acquisition of some Jet stores as well as assets from the administrators of rival Edcon.

The retailer will issue 94 million shares in total, constituting about 28.6% of TFG’s post-rights offer share capital.

At 1103 GMT, TFG shares were down 5.27% at 69 rand.

TFG, like fellow retailers, have been hit by the COVID-19 pandemic that resulted in store closures in all its markets in South Africa, the United Kingdom and Australia. All stores have since re-opened as governments ease restrictions.

But the retailer, which owns Phase Eight and Hobbs in Britain and menswear chain Retail Apparel Group (RAG) in Australia, expects a sustained period of economic uncertainty.