Update CIMB Group raises RM3.55b via placement of 500m new shares

by **Cals** Mon 13 Jan 2014, 22:13

Update CIMB Group raises RM3.55b via placement of 500m new shares
Business & Markets 2014
Written by Ho Wah Foon of theedgemalaysia.com
Monday, 13 January 2014 19:59

KUALA LUMPUR (Jan 13): CIMB Group Holdings Bhd announced today that it will be issuing 500 million new shares equivalent to 6.08% of its enlarged share capital, following an accelerated book-build private placement exercise.

The exercise is to strengthen its capital position, said CIMB in an evening statement today.

The new shares will be issued at RM7.10 per share, equivalent to a 2% discount to the volume weighted average price traded on Friday (Jan 10) of RM7.26.

Total proceeds from the new issue will amount to RM3.55 billion.

"We are delighted to have been able to expeditiously raise such a substantial amount of common equity tier 1 (CET1) to bolster our capital position.

“While we have always sought to operate at optimal capital levels, the sharp depreciation of the Rupiah over 2013 has set back our capital accumulation plan. We have acted decisively to reposition our capital for growth," said Datuk Seri Nazir Razak, Group Chief Executive of CIMB Group, in the statement.

The new issue lifts CIMB Group's CET1 as at Sept 30 2013 from 8.2% to 9.7%.

According to the statement, the new equity was placed to domestic and foreign investors today.

“The offer was well oversubscribed and enabled CIMB to increase the deal size by 25% from 400 to 500 million shares.

“With the new capital, we stand strong to face any future volatility in financial markets and can continue to grow our business at our desired pace going forward," Nazir added.