The FINANCIAL — Citi on July 26 announced the preliminary results of its offers to exchange its publicly held convertible and non-convertible preferred and trust preferred securities for newly issued shares of its common stock. The exchange offers expired at 5:00 p.m., New York City time, on July 24, 2009.
Approximately $20.3 billion in aggregate liquidation value of publicly held convertible and non-convertible preferred and trust preferred securities were validly tendered and not withdrawn in the exchange. This represents 99% of the total liquidation value of securities that Citi was offering to exchange. Citi has accepted for exchange all publicly held convertible and non-convertible preferred and trust preferred securities that were validly tendered and not withdrawn and will issue 5,833,324,374 common shares to the public exchange offer participants.
In addition to the public exchange, Citi previously announced on July 23, 2009, the completion of exchange offers with the U. S. Government and certain private holders of $25 billion in aggregate liquidation preference of Citi preferred stock.
With the expiration of the public exchange offer and pursuant to the U.S. Government's agreement to match up to $12.5 billion of the liquidation value of securities exchanged in the public exchange offers, Citi expects to complete a further exchange with the U.S. Government of $12.5 in aggregate liquidation preference of Citi preferred stock. In aggregate, approximately $58 billion in aggregate liquidation value of preferred and trust preferred securities will have been exchanged to common stock as a result of the completion of all the exchange offers.
"The successful completion of the exchange offers marks a significant milestone for Citi," said Vikram Pandit, Chief Executive Officer. "Citi will have approximately $100 billion of Tangible Common Equity and a Tier 1 Common ratio of approximately 9% based on our June 30 results. That unquestioned financial strength combined with our strategy to return Citi to its core franchise of institutional and consumer businesses spanning an unmatched global footprint are driving Citi's return to sustained profitability and growth."
As a result of these exchanges, Citi will increase its Tier 1 Common by approximately $64 billion and its Tangible Common Equity (TCE) by approximately $60 billion.
Discussion about this post