Bank of Ireland has announced a revised offer to a group of subordinated, or junior, bondholders who did not take part in an earlier offer aimed at boosting the bank's capital strength.
The €75m of bonds involved were originally sold by the Bristol & West building society, which Bank of Ireland later bought, in 1991.
The bank initially asked these bondholders to swap their bonds for cash or shares, but scrapped the offer after just 12% of holders had replied due to difficulties arising from holding the security in certificated form.
Bank of Ireland said it became apparent that many of these bondholders - including many small investors - were experiencing 'unique difficulties' in participating in the original offer. Some investors also threatened to challenge BoI's move in the UK courts.
Under the new offer, holders of the bonds are being offered £40.20 in cash for every £100 they hold. The bank originally offered cash at 20% of face value or equity at 40% of face value to junior bondholders.
The original offer was aimed at boosting the bank's capital position and reducing the amount of funding the State would need to inject. Holders of the Bristol & West bonds represent only 3% of bondholders on which the bank has imposed losses.
EGM set for next month
Bank of Ireland has announced plans to hold an extraordinary general meeting on Friday, September 9 in UCD in Dublin.
The meeting is to seek approval for a waiver of the obligation under Rule 9 of the Irish Takeover Rules, for the bank's new investors to increase their share holdings up to 34.96%.
Last month the bank said that Canada's Fairfax Financial Holdings, Wilbur Ross' New York buyout firm WL Ross & Co, Fidelity Investments, rival investment firm The Capital Group and property company Kennedy Wilson would buy the stake in the bank.
