Wolseley has confirmed that it is considering equity raising to reduce its £3bn debt pile.

Responding to press speculation that was planning a £1.2bn rights issue, it confirmed to the Stock Exchange that it was in talks to raise new equity, but did not reveal how much it was seeking to raise.

It said: ‘Wolseley notes the recent press speculation regarding a possible issue of new equity by Wolseley. The board of Wolseley confirms that discussions have been held to consider the merits of an issue of new equity and any decisions will be communicated to shareholders through the appropriate channels at the appropriate time.’

The US giant, which has been expected to announce equity raising for months, has been hard hit by the downturn in the construction industry and has suffered from its retail exposure to the housing markets in the US and Europe.

Its shares today dropped 3.64% to 174p a share.