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Cerberus considering second Bawag capital injection

21 Sep 2012

Cerberus Capital Management is mulling over a capital injection for Austrian portfolio company Bawag PSK Bank, the latter’s head has said.

Byron Haynes told Bloomberg the lender was in talks with Cerberus ahead of it having to replace €170m of hybrid capital it bought in March under new rules from the Basel Committee on Banking Supervision.

Cerberus has released a statement saying it would support “potential capital actions” at the bank, which it bought in 2006 for €3.2bn.

The firm injected €205m into Bawag two years ago alongside €550m of state aid following consecutive losses at the lender in 2007, 2008 and 2009, Bloomberg said.

Bawag was prevented from paying dividends to equity holders until this year as part of the aid deal, with subsequent dividends restricted until the state is repaid.

Last month Cerberus sold 10 million shares in aircraft leasing company AerCap for $120m at an aggregate discount of $0.09 per share compared to the company’s $12.09 August 17 closing price.

Cerberus continues to hold more than ten per cent of AerCap’s outstanding ordinary shares following the transaction.

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