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RPT-UPDATE 2-Mizuho sets share issue, could raise $7.2 bln

Reuters - Thursday, July 2

* To issue up to 3 bln new shares in July

* Could raise 693 bln yen at closing stock price

* Would increase number of common shares by 27 pct

* Shares rise 2.2 pct, Nikkei dips 0.2 pct

TOKYO, July 1 - Mizuho Financial Group Inc <8411.T> said it would issue up to 3 billion new shares, confirming the amount of stock it would sell in a previously announced deal that would raise $7.2 billion at the current stock price.

Japan's second-largest bank had said in May that it would issue up to 600 billion yen worth of common shares, aiming to bolster a capital base weakened by heavy losses due to a weak economy and a slide in the value of its massive stock portfolio.

Mizuho said it would decide on the price of the new shares between July 15 and July 17.

The global offering, which includes an over-allotment option of nearly 200 million shares, would raise about 693 billion yen for the bank at the stock's closing price on Wednesday of 231 yen.

It would increase the number of common shares outstanding by 27 percent.

Mizuho rivals Sumitomo Mitsui Financial Group Inc <8316.T> and Mitsubishi UFJ Financial Group <8306.T> have also been raising capital to shore up their balance sheets.

The joint coordinators of the deal are Mizuho Securities, Nomura Securities, JP Morgan and the Japan unit of Merrill Lynch.

Mizuho's shares rose 2.2 percent on Wednesday after the announcement, compared to a 0.2 percent decline for the benchmark Nikkei 225 <.N225>. (Reporting by Mayumi Negishi and Nathan Layne; Editing by Edwina Gibbs)

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