Kommunalkredit begins tender offer for fixed/floating-rate notes

By Angela McDaniels

Tacoma, Wash., Aug. 3 - KA Finanz AG and Kommunalkredit Capital I Ltd. announced a tender offer by Kommunalkredit for its €80 million of perpetual non-cumulative subordinated fixed/floating-rate capital notes.

Holders will receive €250 for each €1,000 principal amount, according to a company notice.

This payment includes an early purchase premium of €20 for each note tendered by 9 a.m. ET on Sept. 3, the early tender deadline.

The offer expires at 6 a.m. ET on Sept. 7.

The companies are also soliciting consents to amend the terms of the notes. The changes would allow Kommunalkredit to redeem all of the notes that remain outstanding after the tender offer, if any, at €200 for each €1,000 principal amount.

The proposed changes will be voted on at a meeting at 6 a.m. ET on Sept. 13 in Vienna.

Noteholders who tender by the offer deadline will be deemed to have given instructions to vote in favor of the changes at the meeting.

The tender offer is not being made in the United States or Italy, and it is not being made to the public in the United Kingdom, Belgium or France. Noteholders who are not eligible for the tender offer may be eligible to receive €50 per note by consenting to the proposed changes by the early tender deadline.

The dealer manager is BNP Paribas (+44 20 7595 8668 or liability.management@bnpparibas.com). The tender and consent agent is Deutsche Bank AG, London Branch (+44 20 7547 5000 or xchange.offer@db.com).

KA Finanz holds the securities and credit default swap portfolio remaining after the demerger of Kommunalkredit Austria AG and is in charge of its structured rundown. It is based in Vienna.

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