Santander to sell 1.5 billion euros in debt convertible into shares

Issue is directly only at qualified investors

Leading Spanish lender Banco Santander on Wednesday announced it was issuing 1.5 billion euros in contingent perpetual preferred securities convertible into new ordinary shares under certain circumstances.

It said the issue will be made through a so-called accelerated bookbuilding process and is targeted only at qualified investors. Details of the issue are expected to be announced later Wednesday.

Reuters reported that demand for the issue has amounted to 17 billion euros pushing down the yield the expected yield to 6.5 percent. The issue will reinforce Santander’s Tier 1 capital ratio, which for the group currently stands at 10.45 percent of risk-weighted assets.

The issue comes after Moody’s Investor Services raised its long-term credit ratings for Santander and its rival BBVA to Baa1 and Baa2 respectively in the wake of its decision to upgrade its rating for Spanish sovereign debt.

Recomendaciones EL PAÍS
Recomendaciones EL PAÍS