CB Richard Ellis is aiming to raise around $355m (£228m) of equity through an issue of shares, partly to repay some of its mountain of debt.

The New York-listed property services firm said today that the issue of 50m new shares was underwritten by Credit Suisse, its main lender, and Banc of America.

Based on an assumed price of $7.10, which was CBRE’s share price at the end of last Friday, the issue would give CBRE a net $355m. This could increase to $408m (£262m), if the underwriters exercise their option to buy an 7.5m shares.

However, yesterday CBRE’s shares fell 14% to $6.09 on talk of the share issue. The sale of shares to the public comes after a planned private placing of shares was abandoned last Saturday.

CBRE said the proceeds of the share issue would be used ‘for general corporate purposes, which may include the repayment of principal of revolving credit and term loans under our senior secured credit agreement’. CBRE’s total debt is $2.66bn (£1.7bn).

CBRE is also considering asking its lenders to alter the loan-to-value covenants on its debt to provide ‘additional covenant cushion’

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