ING to launch rights issue to repay half of State capital injection
(Thomson Reuters ONE) - * ING TO REPAY EUR 5 BILLION OF CORE TIER 1 SECURITIES IN DECEMBER 2009 - Agreement with Dutch State on terms to facilitate early repayment at a premium - Repayment of first tranche to include 8.5% coupon of around EUR 260 million - Repayment to include share price based premium of EUR 333 million to EUR 691 million - Additional payments to Dutch State in form of fee adjustments for Illiquid Assets Back-up Facility - Additional IABF payments lead to one-off pre-tax charge of EUR 1.3 billion in Q4 2009* REPAYMENTS TO STATE TO BE FINANCED BY EUR 7.5 BILLION RIGHTS ISSUE - Rights issue underwritten - Goldman Sachs, ING and J.P. Morgan Joint Global Coordinators - Proceeds used to finance repayment and to cover charge for additional payments for IABF - Further repayments to be financed from internal resources and divestment proceeds - Issue to be launched after Extraordinary General Meeting of Shareholders on 25 November 2009ING announced today that it has reached an agreement with the DutchState to alter the repayment terms of the Core Tier 1 securitiesissued in November 2008, in order to facilitate early repayment. Thisearly repayment option is valid until the end of January 2010. INGintends to use this window of opportunity to repurchase EUR 5 billionof the Core Tier 1 securities in December 2009.Under the agreement, ING can repurchase the first EUR 5 billion ofthe securities at the issue price (EUR 10) plus the accrued couponand a repayment premium. The 8.5% coupon payment is estimated to bearound EUR 260 million at the time of repayment. The repaymentpremium depends on the ING share price at the time of repayment. Thepremium has a minimum value of EUR 333 million and increases if theING share price at the time of repayment rises above EUR 11.16. Thepremium is capped at EUR 691 million corresponding with a share priceof 12.40 or above. The repayment terms for the remainder of the CoreTier 1 securities remain unchanged.In January 2009, ING and the Dutch State agreed on an Illiquid AssetsBack-up Facility (IABF). A full risk transfer was realised on 80% ofthe Alt-A portfolio. In order to get approval from the EC on ING'sRestructuring Plan, ING has agreed to make additional payments to theDutch State corresponding to an adjustment of fees for the IABF. Intotal, these extra payments will amount to a net present value of EUR1.3 billion, which will be booked as a one-off pre-tax charge in thefourth quarter of 2009. Under the agreement, the IABF as announced inJanuary 2009, including the transfer price of the securities of 90%,will remain unaltered. The additional payments will not be borne byING's US subsidiaries.In order to finance the repayment of the Core Tier 1 securities andthe associated costs as well as to mitigate the capital impact of theadditional payments for the IABF, ING plans to launch a capitalincrease with preferential subscription rights for holders of(depositary receipts for) ordinary shares of up to EUR 7.5 billion.Goldman Sachs International and J.P. Morgan have agreed to underwritethe rights issue, subject to customary terms and conditions. Proceedsof the issue in excess of the above amounts will be used tostrengthen ING's capital position. ING expects to finance any furtherrepayments of Core Tier 1 securities from internal resources,including proceeds from the divestment of the insurance operations asannounced today.ING does not expect to be subjected by the European Commission to amandatory deferral of coupon payments on hybrid securities. ING willconsult the EC before taking any further repayment or callingdecisions for Tier 1 and Tier 2 capital.The proposed rights issue will be presented for authorisation at anExtraordinary General Meeting of Shareholders, which is scheduled for25 November 2009 in Amsterdam. A notification for the meeting ispublished today. Further details of the issue, including the issueprice, the subscription ratio and the final number of shares to beissued will be published after this EGM. A detailed prospectus forthe issue will be published in due course. Goldman Sachs, ING andJPMorgan are acting as joint global coordinators and jointbookrunners for the rights issue.Jan Hommen, CEO of ING commented: "This rights issue is a criticalcomponent of the measures we announced today to regain ourindependence and to chart a clear course forward. With investors'support, we will be able to repay half of the funds we received lastyear from the Dutch State and maintain our capital strength. Weappreciate the ongoing support of the Dutch State, but fullyrecognize that it is in the best interest of all parties that we getback on our own feet as quickly as possible. As a result, we willcontinue to explore alternatives for exiting the remainder in thecoming period, financed from internal resources including theproceeds of divestments."The agreements with the Dutch State on repayment of the Core Tier 1securities and additional payments for the IABF are included in theRestructuring Plan ING has submitted to the European Commission aspart of the process to receive approval for the government supportmeasures. ING has finalised the negotiations with the EuropeanCommission and formal approval is expected before the EGM in November2009.NOTE FOR EDITORSJan Hommen will address the announcements made today in an analystand investor conference call at 9:00 CET. Members of the investmentcommunity can join in listen-only mode at +31 20 794 8497 (NL) or +44207154 2688 (UK) and via live audio webcast at www.ing.com.A press conference will be held at 11:30 CET. Journalists are invitedto join the conference at ING House, Amstelveenseweg 500, Amsterdam,Journalists can also join in listen-only mode at +31 20 794 8500 andvia live audio webcast at www.ing.com.Weblink to analyst presentationPress enquiries Investor enquiriesRaymond Vermeulen Frans Middendorff ING Group Investor Relations+31 20 541 5682 +31 20 541 6516 +31 20 541 5460Raymond.Vermeulen(at)ing.com Frans.Middendorff(at)ing.com Investorrelations(at)ing.comING PROFILEING is a global financial institution of Dutch origin offeringbanking, investments, life insurance and retirement services to over85 million private, corporate and institutional clients in more than40 countries. With a diverse workforce of about 110,000 people, INGis dedicated to setting the standard in helping our clients managetheir financial future.IMPORTANT LEGAL INFORMATIONCertain of the statements contained herein are statements of futureexpectations and other forward-looking statements. These expectationsare based on management's current views and assumptions and involveknown and unknown risks and uncertainties. Actual results,performance or events may differ materially from those in suchstatements due to, among other things, (i) general economicconditions, in particular economic conditions in ING's core markets,(ii) performance of financial markets, including emerging markets,(iii) the frequency and severity of insured loss events, (iv)mortality and morbidity levels and trends, (v) persistency levels,(vi) interest rate levels, (vii) currency exchange rates (viii)general competitive factors, (ix) changes in laws and regulations,(x) changes in the policies of governments and/or regulatoryauthorities, (xi) conclusions with regard to purchase accountingassumptions and methodologies, (xii) ING's ability to achieveprojected operational synergies and (xiii) the implementation ofING's restructuring plan to separate banking and insuranceoperations. ING assumes no obligation to update any forward-lookinginformation contained in this document.General, limitations on distribution, no offerNot for release, publication or distribution, directly or indirectly,in or into Australia, Canada, Japan, their territories andpossessions. The release, publication or distribution of thisdocument in certain jurisdictions may be restricted by law orregulations. Therefore, persons in such jurisdictions in which thisdocument is released, published or distributed must inform themselvesabout and observe such restrictions.The issue, exercise and sale of rights which may be attributed in therights offering ("subscription rights") and the subscription andpurchase of bearer depositary receipts in respect of shares of theCompany ("shares") are subject to specific legal and/or regulatoryrestrictions in certain jurisdictions. The Company assumes noresponsibility in the event there is a violation by any person ofsuch restrictions.This document does not constitute an offer to sell, or thesolicitation of an offer to buy or subscribe for, any securities, andcannot be relied on for any investment contract or decision. Thisdocument does not constitute a prospectus within the meaning of Art.13 of the EC Directive 2003/71/EC of the European Parliament andCouncil dated November 4, 2003 (the "Prospectus Directive"). Theoffer will be made solely by means of, and on the basis of, asecurities prospectus which is to be published. Any investmentdecision regarding any subscription rights or shares should only bemade on the basis of the prospectus which will be prepared inconnection with the rights offering, and investors are advised toconsult with their bank, broker or investment advisor before takingany such investment decision. The approved prospectus may benotified by the Netherlands Authority for the Financial Markets(Stichting Autoriteit Financiële Markten) to the competentauthorities in other jurisdictions in accordance with Article 18 ofthe Prospectus Directive. The prospectus is expected to be publishedbefore the start of the subscription period for the subscriptionrights and when available, copies of the prospectus may be obtainedat no cost through the website of Euronext Amsterdam by NYSE Euronext(Dutch residents only) and the website of the Company at www.ing.com.United KingdomThis communication is directed only at persons (I) who are outsidethe United Kingdom or (II) who have professional experience inmatters relating to investments falling within article 19(5) of theFinancial Services and Markets Act 2000 (Financial Promotion) Order2005 (as amended) (the "Order") or (III) who fall within article49(2)(A) to (D) ("high net worth companies, unincorporatedassociations etc.") of the Order (all such persons together beingreferred to as "Relevant Persons"). Any person who is not a RelevantPerson must not act or rely on this communication or any of itscontents. Any investment or investment activity to which thiscommunication relates is available only to Relevant Persons and willbe engaged in only with Relevant Persons. Persons distributing thiscommunication must satisfy themselves that it is lawful to do so.European Economic AreaThe Company will not authorize any offer to the public of shares orsubscription rights in any Member State of the European Economic Areaother than the Netherlands and any other jurisdiction into which theprospectus for the offering of shares or subscription rights will bepassported. With respect to each Member State of the EuropeanEconomic Area other than the Netherlands (and any other jurisdictioninto which the prospectus for the offering of shares or subscriptionrights will be passported) and which has implemented the ProspectusDirective (each, a "Relevant Member State"), no action has beenundertaken to date to make an offer to the public of shares orsubscription rights requiring a publication of a prospectus in anyRelevant Member State.Notice to U.S. PersonsThis document shall not constitute an offer to sell or thesolicitation of an offer to buy any securities in any jurisdiction.If and when the rights offering is launched, ING will arrange to sendyou the prospectus it expects to file with the Securities andExchange Commission if you request it by writing to ING GroupInvestor Relations, Location code IH 07.362, P.O. Box 810, 1000 AVAmsterdam or by calling +31 20 541 5460.http://hugin.info/130668/R/1349936/325536.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 26.10.2009 - 07:02 Uhr
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