Financier Dermot Desmond has agreed to underwrite a €150 million convertible bond issue by International Securities Trading Corporation (ISTC), the Dublin firm which raises debt finance on the capital markets and lends it on to banks.
Mr Desmond is underwriting the issue through Sevenca, a company controlled by him. The latest issue will bring ISTC's capital base up to €600 million.
"It is a very big vote of confidence in ISTC by Dermot Desmond in that he is prepared to take such a big stake," said former Anglo Irish Bank executive Tiarnan O'Mahoney, who set up the company in 2005.
Mr O'Mahoney described the bond as "opportunistic", given the increased cost of money in the capital markets due to the credit crunch. As a result, ISTC will make higher profit margins on any loans provided.
It had planned to raise the money at a later date but brought forward the issue to "underpin" liquidity and capital, and to protect ISTC against any unforeseen shocks in the marketplace.
The bond is convertible into ordinary shares in ISTC, which trades in a grey market, after five years, at an equivalent price of €110 a share. It is open to shareholders and new investors.
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