LEHMAN DROPPING AFTERHOURS. DOWN 8%! ??
Something about them selling shares for capital. Closed down .61% at $37.64 for a hollow red doji on a downtrend.
Currently $35.06. 1 Million + in volume within 15 minutes.
Convertible Preferred Stock
NEW YORK, March 31 /PRNewswire-FirstCall/ -- Lehman Brothers Holdings Inc.
(NYSE: LEH) today announced that, in response to investor interest, it intends
to offer 3,000,000 shares of Non-Cumulative Perpetual Convertible Preferred
Stock. Lehman Brothers also expects to grant the underwriter for the offering
an option to purchase up to 450,000 additional shares of the Preferred Stock to
the extent the underwriter sells more than 3,000,000 shares of the Preferred
Stock in the offering. The proceeds from this offering will be used to bolster
the Firm's capital and increase financial flexibility.
"Given the challenging environment and our previously stated view that it
will likely continue the balance of the year, issuing convertible preferred is
appropriate as it optimizes our funding and accelerates our plan to reduce
leverage, and at the same time minimizes dilution to our shareholders," said
Erin Callan, managing director and chief financial officer of Lehman Brothers
and a member of the Firm's executive committee. "We also felt this was the
right time as there was a window of opportunity in the market, as we have
received significant interest from several key institutional investors, who
have been strong supporters of the Firm over time."
The Non-Cumulative Perpetual Convertible Preferred Stock, Series P, carries a
par value of $1.00 per share and a liquidation preference of $1,000 per share
(the "Preferred Stock").
Upon conversion, the Preferred Stock will be convertible into shares of
Lehman Brothers' common stock, plus cash in lieu of fractional shares. The
non-cumulative dividend rate, conversion rate and other terms are yet to be
determined. An application will be made to list the Preferred Stock on the New
York Stock Exchange. The offering of the Preferred Stock is being conducted as
a public offering registered under the Securities Act of 1933.
Lehman Brothers Inc. is serving as sole book-running manager of this
offering. The offering will be made under Lehman Brothers Holdings' existing
shelf registration statement filed with the Securities and Exchange Commission.
