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Cerberus raises $1.7bn by selling shares in Japan’s Aozora Bank

17 Jan 2013

japan-people_sqGlobal distressed debt investor Cerberus Capital Management is understood to have raised about $1.7bn through the sale of shares in Japan’s Aozora Bank.

The Japanese lender sold shares priced at JPY231 ($2.60) each, representing a 3.3 per cent discount to Wednesday’s closing price, according to a term sheet seen by Reuters.

Cerberus launched the sale on Monday January 7. Shares in the company had fallen ten per cent to JPY250 by the close on that day, wiping JPY45.8bn ($520m) from the bank’s market value.

Citigroup and Morgan Stanley underwrote the global offering, while Goldman Sachs and Barclays helped to manage the overseas portion.

Daiwa Securities and Mitsubishi UFJ worked on the domestic sale.

The sale follows Aozora’s announcement in September 2012 that Cerberus – which owned around half of the Japanese lender – was planning to sell down its stake, without specifying by how much.

Cerberus, which first invested in Aozora in 2000, has been attempting to sell its 821 million shares in Aozora following a string of disasters for the bank in recent years.

Aozora lost 80 per cent of its value after Cerberus took it public in 2006, and a further $930m in losses from investments in hedge funds and other toxic assets following the Lehman fallout.

Australia and New Zealand Banking Group ended discussions to buy Cerberus’ 55 per cent stake in the bank in September last year after the two parties failed to agree on a price.

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