ING Confirms IPO Of NN Group

(RTTNews) - ING Group (ING) Thursday confirmed its intention to proceed with the Initial Public Offering and listing on Euronext Amsterdam of NN Group N.V., an international insurance and investment management company.

NN Group offers retirement, life insurance, non-life insurance, investment management and banking in the Netherlands. The IPO will comprise existing ordinary shares in NN Group, currently wholly-owned by ING.

The announcement is in line with ING's objective to divest its insurance and investment management businesses and become a pure bank. ING plans to divest more than 50 percent of its shareholding in NN before December 31, 2015 and the remaining shares before December 31, 2016, in line with the timeline it has agreed with the European Commission.

The company plans NN's transformation program in the Netherlands, profitable growth and operating leverage in other segments, and diligent management of its Japan Closed Block VA segment.

The IPO will consist of a secondary offering of a minority holding of NN Group's existing ordinary shares currently held by ING Group to institutional and retail investors in the Netherlands and to some institutional investors in various other jurisdictions.

ING will receive the net proceeds of the offering and will retain a significant majority holding in NN Group after its listing.

As previously announced, ING agreed with three Asian-based investment firms - RRJ Capital, Temasek and SeaTown - that they would participate in the IPO as anchor investors for an aggregate amount of 150 million euros.

The NN Group shares that these three anchor investors will acquire at the IPO offer price will not be subject to any lock-up. ING has also issued mandatory exchangeable subordinated notes to these anchor investors for an aggregate amount of 1.125 billion euros.

These notes will accrue a 4 percent coupon, and are mandatorily exchangeable into NN Group shares in three tranches.

The first tranche plus accrued interest will be mandatorily exchanged into NN Group shares upon the settlement of the IPO at a discount of 1.5 percent to the IPO offer price. These shares will be subject to a lock-up for six months.

NN Group intends to pay a dividend of 175 million euros, payable in 2015. For 2015 and beyond, the firm plans to pay an ordinary dividend annually in line with its medium to long term financial performance and sees an ordinary dividend pay-out ratio of 40-50 percent of the net operating result from ongoing business.

Ralph Hamers, CEO of ING Group, said, "Today's announcement signals the launch of the final major transaction in ING's five year restructuring . With the IPO of NN Group, we will have substantially completed the repositioning of ING as a pure bank. For NN Group it is a pivotal step in the journey to become a standalone company.''

ING is up 0.7 percent in early morning trade in Amsterdam at 10.49 euros.