Imperial Tobacco launched a £4.9 billion rights issue yesterday, the third-largest in British corporate history.

It also became the latest big UK-based company to admit that it would contemplate leaving the country if the tax regime changed unfavourably.

Shares in the maker of Lambert & Butler cigarettes fell more than 6 per cent, closing down 163p at £24.55, after it launched the 43 per cent discounted rights issue.

The size of the issue was closer than expected to its previously announced upper limit of £5 billion.

The issue is fully underwritten and will help to pay for last year's acquisition of Altadis, the Spanish cigarette maker.

The issue is the biggest by a British-listed company since Royal Bank of Scotland's recent £12 billion issue and British Telecom's £5.9 billion fundraiser in 2001 and comes as a growing list of British companies take the begging bowl to existing shareholders for much-needed cash.

Barrow Hanley Mewhinney & Strauss, the American investment group, is believed to be Imperial's largest shareholder, with more than 6 per cent of the group.

Proceeds will help to pay off some of the debt associated with the acquisition of Altadis, which was completed in January.

It will also help the company to maintain its investment grade credit rating and keep its dividend policy, as well as buying in Altadis's minority stake in Logista, the logistics business, rather than selling it.

Gareth Davis, the chief executive of Imperial, said: “We flagged up that we would do a rights issue and got approval for it from shareholders last summer. The discount is remarkably small compared with RBS's rights issue.”

Royal Bank of Scotland, the banking group, is asking investors for up to £12 billion, while HBOS, which owns Halifax, has launched a cash call for £4 billion.

Imperial is offering one share for every existing share at £14.75 each, representing a discount of 43.1 per cent to Monday's closing price of £26.18.

Management said yesterday that the strength of the euro, which has risen by more than 15 per cent since the deal was first announced, affected the amount they needed to raise.

At the same time, the world's fourth-largest tobacco group reported a 45 per cent slide in first-half profits, down from £421 million to £233 million for the six months to the end of March, as it faced difficulties integrating Altadis.

The group said that its annual cost savings target from the Altadis deal would be €300 million (£238 million) by September 2010 and that this would rise to €400 million by September 2012.

The issue is fully underwritten by Morgan Stanley, Lehman Brothers, Citigroup and Hoare Govett.

A series of rights issues have been announced in recent months as companies seek to boost their balance sheets in the expectation of an economic downturn and to bolster balance sheets.

Companies as diverse as Johnston Press, the regional newspapers group, G4S, the security group, FirstGroup, the rail and bus company, and Balfour Beatty, the construction company, said last week that they were raising capital.

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