**Fidelity Bank (Bahamas)** recently launched a $15 million rights offering, geared towards strengthening its capital base. Existing shareholders have been offered 12 million shares, priced at $1.25 per share. Fidelity has announced that rights not taken up by existing shareholders will be allocated firstly to others who have applied for extra shares, with any remaining thereafter being placed with institutional and other investors.
It is anticipated that in a debt-for-equity swap arrangement, Fidelity Bank & Trust International, parent company of the Bank, will acquire $10 million in preference share debt in the bank from the existing debt holders. As majority shareholder, it will subscribe for all its allocation in the rights offering, effectively underwriting the issue by taking up just over $10 million.
The company aims to grow net income by between 5-10% per year and to achieve and maintain a return on equity of between 15-20% within the next three years.
The closing date for the rights offering is September 1, 2006.