Britain's Tullow Oil Plc plans a rights issue to raise about 607 million British pounds (US$750 million) to cut its $4.8 billion debt burden and make investments in drilling and exploration in Latin America and Africa.

Tullow, whose founder and long-serving CEO Aidan Heavey will hand over to CFO Paul McDade in April, was hit hard by the collapse in oil prices in 2014 just as it was investing heavily in an oil project off Ghana.

Under the terms of the 25-for-49 rights issue, Tullow said on March 17 it will issue 466.9 million shares at 130 pence each, a 45.2% discount to March 16's close.

Some analysts said they were surprised by the move, and Tullow's shares were down 13.7% at 204.9 pence at 0833 GMT.

"The ... rights issue comes as a surprise to us and possibly indicates banks were not as supportive to RBL refinancing as we were expecting," Jefferies analyst Mark Wilson said.

Tullow, which had tightened its investment budget to $500 million this year from $900 million in 2016, had net debt of about $4.8 billion as of Dec. 31, 2016.

The company said it would use the proceeds from the rights issue, which is being underwritten by Barclays, JPMorgan and other banks, for investments in new drilling opportunities and further exploration and appraisal programs offshore Ghana.

The company said it also plans to invest in more exploration and appraisal activity in Kenya and fund drilling projects in Africa and South America.

Tullow also said that CNOOC Uganda Ltd. had exercised its preemption rights to buy 50% of the interests in Uganda that are being transferred to Total.

Total agreed in January to buy most of Tullow's stake in a Uganda project jointly owned by Total, Tullow and China's CNOOC for $900 million.

The terms of CNOOC's agreement will be the same as those agreed on between Tullow and Total, Tullow said. (US$1 = 0.8112 British pounds)