Japan's Hitachi to raise up to $4.5 billion: sources

By Reiji Murai and Kentaro Hamada

TOKYO (Reuters) - Hitachi Ltd, Japan's biggest electronics firm by revenues, plans to raise up to 400 billion yen ($4.5 billion) by issuing new shares and convertible bonds to shore up its battered capital base, two sources familiar with the matter said.

The sources, who asked not to be identified ahead of an official announcement anticipated as early as Monday, said Hitachi plans to sell about 300 billion yen worth of shares and another 100 billion yen in convertible bonds.

The public share offering would be its first in 27 years.

No one could be immediately reached at Hitachi for comment.

Faced with its fourth straight year of losses, Hitachi's shareholders' equity ratio has slipped to just below 11 percent, roughly half that of rival NEC Corp, which earlier this month announced it would raise up to $1.5 billion.

The ratio is calculated by dividing shareholders' equity by total assets and is a measure of financial strength.

Issuing 300 billion yen worth of stock at Friday's closing price of 294 yen would boost Hitachi's shares outstanding by about 30 percent.

Hitachi, a sprawling conglomerate with more than 900 group firms, is trying to restructure unprofitable businesses while shifting resources to its power operations, which include nuclear power plants, railway systems, elevators and batteries for hybrid cars.