BLBG:UniCredit Sets 43% Discount for 7.5B Euro Rights Offer
UniCredit SpA (UCG) will sell new shares at 43 percent less than yesterday’s closing price, excluding the value of rights, in a 7.5 billion-euro ($10.3 billion) offer to strengthen the capital position of Italy’s biggest bank.
UniCredit will sell shares at 1.943 euros each and offer two for every one held, the Milan-based lender said in a statement today. The offer price is 43 percent less than the theoretical value of the shares excluding the rights.
UniCredit shares were suspended after falling the most in two months in Milan trading. The stock has declined 26 percent since the lender announced the offering on Nov. 14.
Chief Executive Officer Federico Ghizzoni is cutting costs and reducing staff to strengthen the bank’s finances and boost profitability. UniCredit is raising the money to plug a capital shortfall and comply with the European Banking Authority’s targets.
Investors including Fondazione CRT, Allianz SE and Carimonte Holding have already said they will subscribe to their rights for 14 percent of the offer, the lender said in the statement. The government’s financial security committee allowed the Central Bank of Libya to participate in the offering to maintain its 5 percent stake in the lender, people familiar with the situation said Dec. 15.
The offer price reflects “current market conditions,” UniCredit said in the statement. A group of underwriting banks have guaranteed the rights offer, the lender said.
UniCredit’s investors can buy stock from Jan. 9 to Jan. 27, and the rights will be tradable from Jan. 9 to Jan. 20, the bank said.
UniCredit was down 9.9 percent to 5.71 euros at 9:44 a.m. in Milan, giving the company a market value of 11 billion euros. That’s the biggest intraday decline since Nov. 1. The 43-company Bloomberg Banks and Financial Services Index (BEBANKS) fell 1.8 percent.
To contact the reporters on this story: Sonia Sirletti in Milan at ssirletti@bloomberg.net; Elisa Martinuzzi in Milan at emartinuzzi@bloomberg.net
To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net
