Citi and Merrill issue bail-out convertibles

Institutional investors, mainly from Asia and the Middle East, support the deals worth a combined $19.1 billion as subprime losses stack up in the US.

Citi and Merrill Lynch have issued more capital to Asian and Middle Eastern investors as they continue to be plagued by subprime woes. Investors hammered the stocks as the news coincided with heightened concerns about a US recession.

Citi announced yesterday that it would sell $12.5 billion of convertible preferred securities to a consortium of investors. The Government of Singapore Investment Corporation GIC will invest $6.88 billion, and the balance will be bought by Capital Research Global Investors, Capital World...

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