* New shares offered at 4.50 euros apiece
* Discount of 55 pct to Monday's close, 38 pct on TERP
* Shareholders to get 20 new shares for every 21 they hold
* Germany's stake in Commerzbank decreases to 17 pct
* Shares indicated 2.6 percent lower
FRANKFURT, May 14 Commerzbank is
offering shares at a deep discount in a 2.5 billion euro ($3.3
billion) capital increase aimed at repaying funds it owes to the
German government and insurer Allianz.
Germany's second-biggest lender said on Tuesday it was
offering 556 million new shares at a subscription price of 4.50
euros per share, a discount of 55 percent to Monday's closing
price of 9.94 euros.
That is equivalent to a 38 percent discount on the share
price when excluding the value of subscription rights, set at
2.65 euros per share, and in line with expectations.
Current shareholders will be entitled to receive 20 new
shares for every 21 shares they now hold. The subscription
period starts on Wednesday and runs until May 28.
Commerzbank shares were indicated to open 2.6 percent lower
in pre-market trade on Tuesday.
As part of the transaction, German bank bailout fund Soffin
will sell Commerzbank shares worth 625 million euros, reducing
its stake to roughly 17 percent from 25 percent.
Soffin's shares will likely be sold at a price near the
theoretical ex-rights price of 7.28 euros, and the placement may
start later on Tuesday, a source familiar with the transaction
In a 2008 bail-out, the German government took a 25 percent
stake in Commerzbank and also granted it billions of euros in a
debt-equity hybrid dubbed a silent participation.
By repaying the silent participation held by the state and
insurer Allianz, Commerzbank will save annual interest expenses
of roughly 200 million euros.
Commerzbank is joining a slew of European banks tapping
shareholders for fresh money, including Germany's bellwether
Deutsche Bank, Russia's second-largest bank VTB
as well as Greek and Spanish banks.
The banks are taking advantage of bullish equity markets as
European shares trade at five-year highs, while bank
shares have returned to around the two-year high they
had reached in late January.
Deutsche Bank, Citi and HSBC are organising