Wednesday, May 25, 2011
(This story was originally published Tuesday.)
DUBAI (Zawya Dow Jones)--Abu Dhabi government investment firm Aabar Investments said Tuesday it plans to launch an EUR750 million unsecured exchangeable bond over Daimler AG (DAI.XE) shares that's due in 2016, amid favorable market conditions.
Aabar, which is the largest shareholder in Daimler with a 9.1% stake, said its commitment to its investment in the German luxury-car maker remained unchanged.
"Aabar's long term partnerships with Daimler in Tesla Motors Inc. and Mercedes-Benz Grand Prix Limited reflect Aabar's strong belief in Daimler by continuing to support Daimler and its management," the company said in a statement.
"In launching the bonds, Aabar is taking advantage of the current market conditions and the attractive financing the equity-linked market currently offers," it added.
The bonds are expected to represent about 12.2 million, or 1.1%, of the current total number of issued and outstanding Daimler shares, according to the statement.
Aabar will use the proceeds of the offering, which is managed by BofA Merrill Lynch, Deutsche Bank and Morgan Stanley, for general corporate purposes.
A Daimler spokesman said the company had been informed beforehand about Aabar's plan. He said Aabar's move is a normal refinancing transaction, which affects only a small portion of Daimler's shares.
The bonds will be issued at par, are expected to carry a semi-annual coupon of 3.5% to 4% per annum, and will be exchangeable into ordinary shares of Daimler, Aabar said.
"If not previously exchanged or redeemed the bonds will be redeemed at par five years from the settlement date," the firm said. "The final terms are expected to be determined and announced today and settlement is expected to take place on or about 27th May 2011."
Aabar is a diversified investment company for parent International Petroleum Investment Co., or IPIC, an Abu Dhabi government firm targeting international oil, gas and petrochemical assets.
The company holds stakes in Unicredit SpA, Glencore International AG, Tesla Motors Inc., Mercedes-Benz Grand Prix Limited, Falcon Private Bank Ltd. and Galactic Ventures LLC.
Aabar said that, in conjunction with the offering, it had entered Tuesday "into certain derivative transactions in relation to a number of Daimler Shares," which may result in significant volumes in trading of Daimler stock.
Aabar officials weren't immediately available for comment.
-By Mirna Sleiman, Dow Jones Newswires; +9714 446-1698; mirna.sleiman@dowjones.com
(Nikhil Lohade in Dubai and Nico Schmidt in Frankfurt contributed to this report.)
Copyright (c) 2011 Dow Jones & Co.
(END) Dow Jones Newswires
25-05-11 0349GMT
