Vw may use a convertible bond issue rather than a chunk of new shares
Thursday, March 11th, 2010
To help fund various acquisitions, Volkswagen AG said that it may use a convertible bond issue rather than a big portion of new shares.
VW said that on April 22, the date of the annual general meeting, it will request that shareholders approve a possible bond issue with an option or right to convert the bond into 40 million preferred shares. Finance chief Hans Dieter Poetsch said that having that authorization would provide an additional financing tool that the company regards as standard for raising the financial flexibility of major joint stock companies such as Volkswagen, but which is not currently available to the company. VW asserted that the issue could be bearer bonds with warrants or be convertible bonds with a term of up to 20 years on one or several occasions in the period until April 21, 2015. Management would only be able to exercise the authorization if the sum total of new shares does not go beyond the 135 million approved by shareholders at December’s extraordinary general meeting.












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