By Clara Ferreira-Marques
LONDON, Dec 14 (Reuters) – Lloyds completed a record 13.5 billion pound ($21.9 billion) rights issue on Monday, ending a turbulent period for the bank and shifting investor focus to a potential government stake sale in 2010.
The discounted cash call — the world’s largest to date — is a key plank of a bumper capital raising effort worth over 23 billion pounds in total and aimed at helping Britain’s largest retail bank avoid a state-backed scheme for bad debts.
Lloyds Banking Group said on Monday 95.3 percent of the new shares offered were taken up by investors including the British government, which owns around 43 percent of the bank.
That left just over 600 million pounds of shares to be placed by the underwriters — Bank of America Merrill Lynch, UBS and Citigroup — far better than Lloyds’s 4 billion pound sale in June, which left a unwanted shares amounting to 13.1 percent.
The rump was sold within hours at 55.5 pence per share, an 18.5 pence premium to the rights issue price. The sale will raise some 18.4 pence per share for investors who did not take up their rights, an average of 180 pounds each, the bank said.