KB Deutsche board OKs issue of up to €123.75 million convertibles

By Jennifer Chiou

New York, Nov. 19 - IKB Deutsche Industriebank AG announced that its board of managing directors, with the consent of the supervisory board, opted to issue up to €123.75 million of subordinated convertible bonds.

IKB said it expects that Lone Star will fully subscribe the portion of convertible bonds to which IKB shareholders do not subscribe by exercising their pre-emptive rights.

The new convertible bonds purchase will form part of the announced €225 million increase of IKB funds owned by Lone Star. Moreover, Lone Star will also subscribe to about €100 million of subordinated bonds.

The bonds will be conditionally redeemable on April 12, 2014.

Upon conversion of the subordinated convertibles, IKB's share capital will increase to €1.62 billion from €1.5 billion, divided into up to 633,415,754 shares.

In addition, IKB's board also resolved to transfer €2.6 billion of the portfolio investments, which have remained at IKB, to a special purpose vehicle, with a first-loss piece in this SPV of €190 million.

IKB is a bank based in Dusseldorf, Germany.

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