what do the Americans think of Lenihans statement ?
Shares of Allied Irish Banks plc (NYSE: AIB) are falling 27 percent in early U.S. trading as the bank seeks additional capital, further diluting current shareholders and putting the bank more in the hands of the Irish government.
Irish Financial Regulator have increased the amount of equity capital required at the bank from EUR7.4 billion to EUR10.4 billion. As a results, Allied Irish Banks is launching a EUR5.4 billion equity capital raising in November, will be completed before the end of the year.
This equity capital raising will be fully underwritten by the National Pensions Reserve Fund Commission (NPRFC) at a fixed price of EUR0.50 per new ordinary share, which represents a discount of approximately 9.4 per cent to the official closing price of an ordinary share on the Irish Stock Exchange on 29 September 2010.
On completion of the equity capital raising it is possible that the NPRFC will own a significant majority stake in AIB.
In conjunction with the capital raise, management and board changes will be made. Mr. Dan O’Connor that he will step down as Executive Chairman within the coming weeks. In addition, the contract of Group Managing Director Mr. Colm Doherty was terminated and he will be leaving before the end of the year.