Cerberus to raise $1.7b through Aozora Bank exit

The firm plans to sell the shares for JPY231 apiece, according to a statement made by the Tokyo-based bank yesterday.

The price is 3.4% lower than Aozora's JPY239 close on the Tokyo Stock Exchange yesterday. The exit is expected to raise less than the JPY158.1 billion the shares were worth on January 7, when the bank announced the deal. It said that Cerberus would sell up to 632.5 million shares.

As many as half the shares will be offered to overseas investors. New York-based Cerberus will cut its voting rights from 57.8% to 7.7%.

Cerberus oversaw a turnaround at Aozora which included eight years of profit and a 2006 IPO. The firm exits as the bank prepares to pay back a taxpayer bailout, repurchase shares and boost dividends.

Aozora is in the process of repaying JPY227.6 billion in bailout money to the Japanese government, which owns preference shares that were due to be converted into ordinary shares by October last year. If converted, the government would have had a stake in the bank of 22%.

Aozora has an agreement with the government to postpone conversion by 10 years during which time it will reimburse taxpayers at a price of JPY385 per share.

Citigroup and Morgan Stanley are coordinating the global offering. Goldman Sachs and Barclays are helping to manage the overseas portion as Daiwa Securities Group and Mitsubishi UFJ Financial Group work on the domestic sale.

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• Topics
• North Asia
• Exits
• Buyout
• Financials
• Japan
• Financial Services
• Exit
• Cerberus Capital Management