WaMu investor waives anti-dilution rights

By Devika Patel

Knoxville, Tenn., Sept. 17 - Washington Mutual, Inc. investor TPG Capital waived its rights under an agreement that provided for additional payment if WaMu conducted additional financings.

"It became clear that it would be in the best interests of Washington Mutual and our investors to waive the price reset payment provisions that were agreed to with the bank at the time of our original investment in April 2008. Our goal is to maximize the bank's flexibility in this difficult market environment," TPG Capital said in a press release Wednesday.

WaMu sold $7 billion in equity securities to an investment vehicle managed by TPG Capital in an August financing that included common stock and convertible preferred stock.

The original agreement between the companies stated that if, within 18 months of the closing of the financing agreement between WaMu and TPG Capital, WaMu conducted additional financings that cause dilution to TPG Capital's investment, TPG Capital would have the right to be paid an amount sufficient to compensate it for the dilution.

TPG Capital is the buyout group of private investment firm TPG, with offices worldwide.

WaMu is a Seattle-based consumer and small business bank.

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