By Anthony Shevlin

Germany's Ceconomy AG (CEC.XE) said Friday that it will increase its share capital by around 10% following approval for the move from the company's supervisory board.

Ceconomy said that Freenet AG (FNTN.XE) has agreed to acquire all of the newly issues shares and that it will pay 8.50 euros ($9.83) per share. Freenet will invest around EUR277 million following the agreement, Ceconomy said.

The agreed share price represents a premium of around 18% on the closing price of Ceconomy's ordinary shares on June 28, the company said.

Freenet will hold a stake of around 9% in Ceconomy following the completion of the capital increase, Ceconomy said.

Ceconomy said it plans to use the proceeds from the capital increase to strengthen its balance sheet as well as to increase its financial strength.

Write to Anthony Shevlin at anthony.shevlin@dowjones.com

(END) Dow Jones Newswires

June 29, 2018 12:40 ET (16:40 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.
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