SCi Entertainment, the besieged games company behind Lara Croft, confirmed today that it was considering strengthening its arm with an equity placement and rights issue to raise £50 million of capital.

Phil Rogers, the new new chief executive, indicated in late February that SCi needed to raise between £45 million and £55 million in working capital after reporting greater losses and delays to the launch of key games, including the next Tomb Raider instalment.

The games group also unveiled an emergency restructuring program that included relocating production facilities and dismissing a quarter of its workforce

The UK's largest games publisher is understood to be in talks with Time Warner, the US media giant, about increasing its 10 per cent stake in the company or bringing in NBC Universal as a significant minority shareholder.

SCi said in a statement: "The board of SCI notes the recent speculation about an equity issue and confirms that it is considering a placing and open offer in the near future.

"This fundraising will be to raise the working capital the company indicated it required at the time of its interim results on 29 February."

The company has faced escalating games development costs and has struggled to compete with bigger rivals in the games distribution market.

In January, Jane Cavanagh, the chief executive, Bill Ennis, the head of its publishing division, and Rob Murray, who ran SCi's studios, all left “with immediate effect”.

SCi had been in takeover talks with a number of companies at the end of last year but failed to agree a deal.

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