30-Mar-2012 10:44 AM

Lufthansa Malta Blues LP offering notes exchangeable into JetBlue shares and guaranteed by Lufthansa

Lufthansa announced (29-Mar-2012) that Lufthansa Malta Blues LP successfully priced the issue of EUR234.4 million notes due 2017 exchangeable into shares of common stock of JetBlue Airways Corporation at the option of the noteholders and guaranteed by Lufthansa AG. Lufthansa offered and sold the notes to qualified institutional buyers in an institutional private placement. Lufthansa, which expects to settle the offering on or around 05-Apr-2012, set the terms for the five-year notes maturing 05-Apr-2017 at a coupon of 0.75% p/a, payable annually and an initial exchange price of EUR5.02 per share of JetBlue common stock, representing an exchange premium of 37.5% based on the volume weighted average trading price between market open and pricing on 29-Mar-2012. JetBlue will not receive any of the proceeds from the sale of the notes or any financial benefit from the exchange of JetBlue common stock. The proceeds from the offering are to be used for general corporate purposes. Lufthansa, meanwhile, stated it has no intention of ending its investment in JetBlue Airways, although the option remains a possibility depending on the capital needs of the airline (Reuters, 29-Mar-2012). Lufthansa CEO Christoph Franz said Lufthansa's plans to offer the convertible notes that can be exchanged for up to 46.7 million shares of JetBlue common stock is an attractive way "given current market conditions" to get financing. "It's not the intention of Lufthansa to sell stock and terminate our investment in JetBlue," he said noting, "We did not sell one single share." Lufthansa owns a 15.7% stake in the carrier. [more - original PR - Lufthansa] [more - original PR - JetBlue SEC Filing] [more - original PR - II]

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