Beleaguered resin manufacturer Nuplex is looking to raise $110 million worth of capital through a rights issue and placement plan.

The company has also reached an agreement with its banks to temporarily extend the ratios of its debt covenant, after recently confirming it had breached the covenant.

Resin manufacturer Nuplex Industries is in danger of breaching its debt covenant, after yesterday cutting its earnings forecast due to soft market conditions.

Based on the company’s revised full year ebitda guidance of $NZ85 million, First NZ Capital is warning that the Nuplex’s debt cover covenant may be breached.

Debt cover is calculated by dividing a company's net bank debt by its ebitda.

In Nuplex's case, analyst Jason Familton says its covenant requires the company's net debt to be no more than three times its ebitda.