NEW YORK (The Deal) -- ING Groep (ING - Get Report) raised 1.5 billion ($2.05 billion) from the initial public offering of insurance subsidiary NN Group, whose shares started trading Tuesday on the Euronext Amsterdam exchange.
Amsterdam-based ING sold a total of 77 million shares in the IPO at 20 each, near the upper end of the 18.50 to 22 price range. About 94.8% of the shares were sold to Dutch and international institutional investors, and the rest to Dutch retail investors. Another 11.6 million shares could be sold if a greenshoe is used.
After 450 million-worth of subordinated notes are converted into NN shares and the greenshoe, ING's total proceeds will come to about 2 billion. ING said it would use the funding to cut debt.
Excluding the greenshoe, ING will be left with 71.4% of NN Group as it nears the finish line of a European Commission-mandated restructuring. Last week ING sold its remaining 10% stake in Brazilian insurer SulAmerica through a block trade in Sao Paolo, to raise about 170 million.Based on 350 million shares outstanding at settlement of the IPO, the offer price gives NN Group a starting capitalization of 7 billion. Shares began trading today under the symbol 'NN' and were up 1.07, or 5.4%, at 21.07 on their debut. ING plans to further trim its stake in NN Group to below 50% by December 2015, and the rest by the end of 2016, in line with promises made to the European Commission. It's keeping its options open for how to dispose of the rest, reiterating Tuesday that it retains "full flexibility" on that front, subject to certain lock-up arrangements with the underwriters. JPMorgan Chase (JPM - Get Report), Morgan Stanley (MS - Get Report), ING Bank and Deutsche Bank (DB - Get Report) are joint global coordinators for the IPO. As announced in April, ING secured 1.275 billion in pre-IPO investments from RRJ Capital, of Hong Kong, Singapore's state-owned Temasek Holdings and Temasek's SeaTown Holdings Pte Ltd. The trio will buy a combined 150 million of the IPO shares and another 1.125 billion of notes with a 4% coupon that are automatically convertible into NN Group shares in three tranches, starting with a block when the IPO is settled on July 7.