ING announces terms for 7.5-billion-euro rights issue
(THE HAGUE) - Dutch bank and insurance group ING announced on Friday it would issue 1.7 billion new shares at 4.24 euros (6.3 dollars) apiece to raise 7.5 billion euros to pay back government emergency funding.
"The share capital of ING will be increased by 7.5 billion euros through the issue of 1,768,412,544 new shares," it said in a statement.
"The issue price is set at 4.24 euros per share", less than half Thursday's closing stock exchange price of 8.92 euros.
ING unveiled the terms of the deal on Friday, already having announced last month that it would raise 7.5 billion euros.
It plans to repay some five billion euros in state aid plus 950 million euros in interest on the 10 billion euros the government extended to the it in October 2008 and January this year to help it through the worst of the global financial crisis.
It was also required by the European Commission to pay the state another 1.3 billion euros in fees.
The banking group reported a 499-million-euro net profit in the third quarter of 2009 from a loss of 478 million euros in the same period last year.
"This rights issue is a critical component of the measures we announced to regain our independence and to chart a clear course forward," ING chief executive officer Jan Hommen said.
"The Dutch State has indicated it is open to discussing modification of the repayment terms of the second half of the Core Tier 1 Securities, which we plan to repay from potential divestment proceeds and retained earnings."
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