June 5 is decision day for Lloyds' shareholders

20th May 2009 07:02

Lloyds Banking Group shareholders will have until noon on 5 June to decide whether to participate in the bank's placing and compensatory open offer.Qualifying shareholders, i.e. those who acquired shares before 8:00am on Wednesday, 20 May, will be able to subscribe for 0.6213 new ordinary shares for every ordinary share currently held at an offer price of 38.43p per share. Any shares not taken up by qualifying shareholders will be sold in the market at a price not lower than 38.43p plus associated placing expenses.Any proceeds from the placing of the rump will be distributed pro-rata to qualifying shareholders who did not participate in the open offer. As such, it will no longer be possible to subscribe for extra shares. The company is sending out a circular to shareholders which will include a timetable of scheduled events. The share issue has been underwritten by HM Government. The funds from the issue will be used to redeem the £4bn of preference shares held by HM Treasury.