KfW sells €4.5 billion exchangeable, into Deutsche Telekom, at 0.75%, up 38%

Nashville, July 9 - The German state-owned reconstruction bank Kreditanstalt für Wiederaufbau sold €4.5 billion of exchangeables, convertible into Deutsche Telekom AG shares, with a 0.75% coupon and 38% initial conversion premium.

It was a record amount for a European equity-linked bond issue, according to a capital markets source working on the deal.

The deal sold at the cheap end of price talk that put the coupon between 0.25% and 0.75% with a 28% to 43% initial conversion premium.

Deutsche Bank Securities and JPMorgan were joint lead managers of the Regulation S issue.

There is a €500 million greenshoe available.

KfW said upon conversion, its stake in Deutsche Telekom would be reduced to around 37% from 43%.

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