MBIA said Warburg Pincus will execute the financing through direct purchase of stock and be a backstop for a rights offering for existing MBIA stockholders.
NEW YORK (Reuters) - MBIA Inc <MBI.N> said on Monday that buyout firm Warburg Pincus has agreed to invest $1 billion in the bond insurance company, bolstering its finances amid concerns about its liquidity.
MBIA said Warburg Pincus will execute the financing through direct purchase of stock and be a backstop for a rights offering for existing MBIA stockholders.
Warburg will initially invest $500 million by buying 16.1 million MBIA shares at $31 each. It will also receive warrants to purchase stock for a rights offering.
Armonk, New York-based MBIA said on December 6 it was looking at ways to shore up its capital base amid investor concern that it could face a severe liquidity crisis amid collapsing values for bonds backed by subprime mortgages.
!ADVERTISEMENT!(Reporting by Dane Hamilton; editing by John Wallace)
