MBIA Inc. (NYSE: MBI) has entered into a definitive agreement with global private equity firm Warburg Pincus to invest up to $1 billion in MBIA through a direct purchase of MBIA common stock and a backstop for a shareholder rights offering. MBIA said the investment will increase MBIA’s "already substantial capital and claims-paying resources" and "enable MBIA to grow its business profitably at a time when market conditions present it with attractive opportunities."
What is interesting here is that the market cap for MBIA is $4.47 Billion and that is after the big pop in the stock. It is hard to rely on the books from prior quarters because of the liquidity crunch that has been seen more sharply in recent weeks. It had listed over $4.5 Billion in current assets with cash, short term investments and receivables, although its long-term investments were listed as just under $40 Billion. Total liabilities were $38.79 Billion. Obviously there are going to be some different numbers on the next report.
Shares of MBIA are up almost 19% at $35.60 after the financing pact announcement. Its 52-week trading range is $25.84 to $76.02.
Jon C. Ogg
December 10, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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