Photon Group founder Tim Hughes will step down as executive chairman after the company announces a trading update today.

Investors will, however, have to wait for what is expected to be a $200 million capital raising, with the company presumed to disclose it has asked advisers UBS and Macquarie to further study a range of capital management options.
Shareholders had expected new Photon CEO Jeremy Philips to announce a rights issue at the same time as he released a trading update, which is supposed to include a revised set of accounts, a profit downgrade, writedowns, corporate restructure and some 50 lay offs.

Total writedowns and impairments are expected to total $180 million. A raising of that size would necessitate a shareholder vote, extensive documentation and further consultation with investors, according to market sources.

The company's nominal market value is $191 million. Photon shares last changed hands at $1.02 each in early June. Any rights issue is predicted to be valued as low as 25c a share.

Trading in the stock was postponed after Mr Philips started re-examining the accounts and earnings outlook during his second week in the role. Mr Hughes indicated that he would resign from full-time executive duties earlier this year, giving way to Photon director Brian Bickmore. The latter was a founding director of commercial radio group Austereo and will become Photon's first non-executive chairman.

Mr Hughes has held the executive chairman position at Photon since it listed in 2004. He played a key role in obtaining the 50 different communications, marketing and advertising businesses of the company.