Bertelsmann Raises $500 Million US dollars In Private Placement In The U.S.

Bertelsmann has issued notes amounting to $500m in the United States, as a Private Placement of debt arranged by ABN AMRO and the Royal Bank of Scotland. Most of the 17 investors are U.S. insurance companies and pension funds. The issue was more than three times oversubscribed and was increased from originally $300m to $500m. It represents the biggest U.S. Private Placement to date by a German group. Bertelsmann will use the funds to pay down existing bank loans.

The $500m notes are divided into three tranches: one $100m tranche with a maturity of seven years and two tranches of $200m each with a maturity of 10 and 12 years respectively. The coupons of these non-public notes have been set at 4.69 percent for the seven-year, 5.23 percent for the 10-year and 5.33 percent for the 12-year tranche. The placement was arranged by Bertelsmann's subsidiary Bertelsmann U.S. Finance, Inc. following a five-day road show in the U.S.

Bertelsmann's Chief Financial Officer Siegfried Luther comments on the transaction: "The issuance underscores Bertelsmann's focus on the capital market and our appeal for investors with a long-term view. This step opens up a select group of investors in the U.S. capital market for us and gives our financing a broader base."

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