GIC to proceed with UBS deal
The Government of Singapore Investment Corporation (GIC) said Thursday it will complete its transaction with Swiss bank UBS after the bank's shareholders approved the deal.
Under the agreement, GIC will inject $10.3 billion giving it a stake of around nine per cent and making it the largest single shareholder.
About Dh6.9 billion (two billion Swiss francs) will come from an unnamed Middle East investor.
Now that shareholders have approved the deal, GIC will "proceed to complete the transaction in accordance with the terms of the agreement," it said in a brief statement.
Shareholders voted in favour of the capital hike during a meeting in Switzerland on Wednesday despite fierce criticism of the bank's chairman Marcel Ospel.
Under the deal announced in December, GIC committed to subscribe to 11 billion Swiss francs (Dh37.99 billion) worth of mandatory convertible notes that will pay a coupon of nine percent until conversion into ordinary shares about two years after issuance, UBS said.
Earlier this month UBS said it plunged to its first-ever full-year net loss after losing $18 billion as a result of a crisis in the US subprime or higher-risk mortgage sector which has afflicted banks around the world.
In January, GIC said it would invest $6.88 billion in US banking giant Citigroup, whose finances have also been battered by the US housing slump. (AFP)
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