Barclays has revealed that it is to raise £4.5billion through a discounted share placing and open offer in which the Qatar Investment Authority and Sumitomo Mitsui Banking Corporation will become major new shareholders.
Barclays will raise some £4billion through a placing and open offer of 1.407 billion new shares at 282p each, on the basis of three new shares for every 14 held.
The balance of £500million will be raised through a placing to Sumitomo MitsuiBanking, Japan's third biggest bank, of 169 million new shares at 296p.
The issue of 1.6 billion new shares will also see the chairman of Qatar Holding, His Excellency Sheikh Hamad Bin Jassim Bin Jabr Al-Thani, and his family become significant new investors.
Restoring capital base
The news comes after Exec reported last Friday, June 20th, that UK's third biggest bank is looking to shore up its capital base which has been damaged by the fall-out from the US sub-prime market crisis.
The bank has written down a massive £1.7billion in the first quarter, in relation to credit-crunch losses, on top of £1.6billion last year.
As well as restoring its capital base, the share placing will enable Barclays to take advantage of current market turbulence to win new higher margin business by diversifying its profits based.
The Qatar Investment Authority and Challenger, the company representing the chairman of Qatar Holding, have agreed to invest up to £1.76billion and £533million respectively.
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