March 19 (SeeNews) - Financial and insurance group Eurohold Bulgaria [BUL:4EH] is planning to seek to raise up to 154.1 million levs ($89.5 million/78.8 million euro) in a capital increase through issuance of preferred shares, it said on Tuesday.
Eurohold Bulgaria intends to use the proceeds from the capital hike to reduce its debt and strengthen the capital position of its unit Euroins Insurance Group (EIG), the company said in a bourse filing.
Eurohold Bulgaria will offer 79,010,240 preferred shares with a guaranteed dividend payout and no voting right. The shares, which carry a nominal value of 1 lev each, will be offered for subscription at a price of 1.95 levs.
The shares have a guaranteed dividend equal to 6% of their nominal value in the first 5 years since their issuance, 3% in the following 5 years, and 1% starting from the 11th year after their issuance.
The capital increase will be considered successful if at least 20 million shares are subscribed for and paid for.
Eurohold Bulgaria shareholders will vote on the proposal at a meeting scheduled for April 22.
As at 13:15 CET on Tuesday, Eurohold Bulgaria shares traded 8.57% higher at 1.9 levs on the Bulgarian Stock Exchange.
EIG said earlier this month that it has agreed to acquire four units of Germany's ERGO based in three European countries. The deal concerns ERGO’s life and non-life subsidiaries in Romania and the Czech Republic, as well as a non-life insurer in Belarus.
Eurohold Bulgaria's portfolio includes companies active in financial services, leasing, insurance and car sales.
(1 euro = 1.95583 levs)