MTU Aero Engines AG

Capital/Financing Update • Jan 23, 2007

News Details

Ad-hoc | 23 January 2007 07:48

MTU Aero Engines Holding AG: MTU launches convertible bond offering

MTU Aero Engines Holding AG / Issue of Debt

Ad hoc announcement according to § 15 WpHG transmitted by DGAP - a company
of EquityStory AG.
The issuer is solely responsible for the content of this announcement.

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MTU Aero Engines Holding AG ('MTU') announces today that it has launched an
offering (the 'Offering') to institutional investors only of approximately
EUR150 million senior unsecured convertible bonds (the 'Bonds') through MTU
Aero Engines Finance B.V., a wholly-owned Dutch finance subsidiary of MTU.
The Bonds will be guaranteed by MTU and will be convertible into existing
or new shares of MTU.

The Bonds (denomination EUR100,000) will have a maturity of 5 years and
will be issued with a coupon of 2.75% to 3.25% and a conversion premium of
30% to 35%. The coupon and conversion premium will be set at final pricing.
The Bonds cannot be called by the Issuer for the first three years, and are
callable thereafter subject to a 130% trigger.

The base offering size is EUR150 million. The offering size may be
increased by up to EUR15 million (10%). Additionally, MTU has granted the
lead manager a greenshoe option of up to EUR15 million (10%) to cover
over-allotments (if any) exercisable until the settlement date. The issue
size can therefore reach up to EUR180 million which, based on yesterday’s
closing price and the range set for the conversion premium, could result in
up to approximately 3.7 million shares underlying the bond at the outset.
Settlement of the Bonds is expected on or about 1 February 2007.

MTU will apply for the admission of the Bonds to trading on the Luxembourg
Stock Exchange’s Euro MTF Market. Listing is expected to occur on or prior
to 30 April 2007.

Deutsche Bank AG is acting as sole bookrunner and lead manager for the
Offering.

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Information and Explaination of the Issuer to this News:

Important Note

Not for distribution or release in or into the United States of America (or
to US persons), Canada, Australia, or Japan or in any other jurisdiction in
which offers or sales would be prohibited by applicable law

In connection with the offering of the Bonds, Deutsche Bank AG (the
'Stabilising Manager') or any person acting on behalf of the Stabilising
Manager, may over-allot and effect transactions with a view to supporting
the market price of the Bonds at a level higher than that which might
otherwise prevail. However, there is no assurance that the Stabilising
Manager(s) (or persons acting on behalf of the Stabilising Manager) will
undertake stabilisation action. Any stabilisation action shall begin on or
after the date on which adequate public disclosure of the final terms of
the offer of the Bonds is made and, if begun, may be ended at any time, but
it must end no later than the earlier of 30 days after settlement and 60
days after the allotment of the Bonds.
FSA / Stabilisation

This ad-hoc announcement is for information purposes only and does not
constitute or form part of, and should not be construed as an offer or an
invitation to sell, or issue or the solicitation of any offer to buy or
subscribe for, any securities. In connection with this transaction there
has not been, nor will there be, any public offering of the Bonds. No
prospectus will be prepared in connection with the offering of the Bonds.
The Bonds may not be offered to the public in any jurisdiction in
circumstances which would require the Issuer of the Bonds to prepare or
register any prospectus or offering document relating to the Bonds in such
jurisdiction. The distribution of this ad-hoc announcement and the offer
and sale of the Bonds in certain jurisdictions may be restricted by law.
Italy has only partially implemented the Prospectus Directive and,
accordingly, the provisions of the Prospectus Directive shall apply with
respect to Italy only to the extent to which the relevant provisions of the
Prospectus Directive have already been implemented in Italy. The Bonds may
not be placed, sold or offered to individuals resident in Italy in the
primary or in the secondary market. Any persons reading this ad-hoc
announcement should inform themselves of and observe any such restrictions.

This ad-hoc announcement does not constitute an offer to sell or a
solicitation of an offer to purchase any securities in the United States.
The securities referred to herein (including the Bonds and the shares of
MTU) have not been and will not be registered under the U.S. Securities Act
of 1933, as amended (the 'Securities Act') or the laws of any state within
the U.S., and may not be offered or sold in the United States or to or for
the account or benefit of U.S. persons, except in a transaction not subject
to, or pursuant to an applicable exemption from, the registration
requirements of the Securities Act or any state securities laws. This
ad-hoc announcement and the information contained herein may not be
distributed or sent into the United States, or in any other jurisdiction in
which offers or sales of the securities described herein would be
prohibited by applicable laws and should not be distributed to United
States persons or publications with a general circulation in the United
States. No offering of the notes is being made in the United States.

This ad-hoc announcement is only being distributed to and is only directed
at (i) persons who have professional experience in matters relating to
investments falling within Article 19(1) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2001 (the 'Order') and (ii)
high net worth entities falling within Article 49(2) of the Order and (iii)
persons to whom it would otherwise be lawful to distribute it (all such
persons together being referred to as 'relevant persons'). The Bonds are
only available to, and any invitation, offer or agreement to subscribe,
purchase or otherwise acquire such Bonds will be engaged in only with,
relevant persons. Any person who is not a relevant person should not act
or rely on this ad-hoc announcement or any of its contents.

Contact for media representatives:
Eckhard Zanger
Senior Vice President Corporate Communications and Investor Relations
Tel.: ++ 49 89 14 89-91 13
Fax: ++ 49 89 14 89-21 72

Contact for investors and analysts:
Inka Koljonen
Head of Investor Relations
Tel.: ++ 49 89 14 89-83 13
Fax: ++ 49 89 14 89-9 50 62

MTU Aero Engines Holding AG
Dachauer Straße 665
80995 München, Germany

DGAP 23.01.2007

Language: English
Issuer: MTU Aero Engines Holding AG
Dachauer Straße 665
80995 München Deutschland
Phone: +49 (0)89 14 89-8313
Fax: +49 (0)89 14 89-95062
E-mail: Inka.Koljonen@muc.mtu.de
WWW: www.muc.mtu.de
ISIN: DE000A0D9PT0
WKN: A0D9PT
Indices: MDAX
Listed: Amtlicher Markt in Frankfurt (Prime Standard); Freiverkehr in
Berlin-Bremen, Düsseldorf, Hamburg, München, Stuttgart

End of News DGAP News-Service

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