Today E.ON successfully issued a €113 million exchangeable bond based on shares of Swiss energy company BKW AG. Within the four year maturity bondholders have the option to exchange their bonds into BKW shares held by E.ON at a predetermined price of €32.21 per share, which represents a premium of 22.5 percent in respect to the market price of BKW stock at the time of bond issuance. Investors who do not exchange their bonds until maturity will be paid back the principal amount. The bond has a coupon of 0.00 percent per year and has been issued at a price of 101 percent. As a result, E.ON achieved a negative yield.
“The exchangeable bond is an innovative way for us to divest mid-term our remaining 6.7 percent stake in BKW,” E.ON CFO Klaus Schäfer said. “It’s an example of how we’re continuing to optimize E.ON’s portfolio of businesses. E.ON remains confident in the future perspectives for the BKW stock.”
Settlement is expected to take place on October 1, 2014. A listing at the Open Market segment (Freiverkehr) of the Frankfurt Stock Exchange is intended.
The bond was offered exclusively to institutional investors outside the United States, Canada, Australia, Italy, South Africa, Japan, and any other countries in which the offer or sale of securities is subject to special legal restrictions.The securities referred to herein will not be registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), or any U.S. State security laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act.