8-KOther Events

CORNING INC /NY 8-K Report (Nov 9, 2001)

Filed November 9, 2001For Securities:GLW

Summary

Corning Incorporated (GLW) filed an 8-K on November 9, 2001, to announce the completion of a $600 million offering of senior unsecured convertible debentures. These debentures mature in November 2008 and carry a coupon rate of 3.50% annually. The offering represents a new form of financing for the company and was made under its existing universal shelf registration statement. Investors should note that the debentures are convertible into Corning common stock at a price of $9.68 per share, which was a 25% premium over the closing stock price on the announcement date. The proceeds are earmarked for general corporate purposes, including working capital, capital expenditures, and potential acquisitions. This move indicates Corning's strategy to secure capital for future growth and operations.

Key Highlights

  • 1Corning Inc. completed a $600 million offering of senior unsecured convertible debentures on November 8, 2001.
  • 2The debentures have a 7-year maturity, due in November 2008.
  • 3The annual coupon rate for the debentures is 3.50%.
  • 4Debentures are convertible into Corning common stock at a price of $9.68 per share.
  • 5The conversion price represented a 25% premium over the closing stock price of $7.74 on November 8, 2001.
  • 6Net proceeds will be used for general corporate purposes, including working capital, capital spending, and potential acquisitions.
  • 7Goldman, Sachs & Co. served as the sole bookrunning manager for the offering.

Frequently Asked Questions

The net proceeds from the offering are intended for general corporate purposes, including working capital requirements, normal, ongoing capital spending, and the possible funding of future acquisitions. This indicates Corning is raising capital for operational needs and potential strategic growth opportunities.

The debentures are senior unsecured convertible debentures with an aggregate principal amount of $600 million, maturing in November 2008. They carry an annual coupon rate of 3.50% and are initially convertible into Corning common stock at $9.68 per share. Corning has the option to redeem the debentures starting in November 2004.

The initial conversion price of $9.68 per share was set at a 25% premium to Corning's closing stock price of $7.74 on November 8, 2001. This suggests that investors converting the debentures would be paying a premium for the company's stock, reflecting an expectation of future stock price appreciation.

Yes, the filing explicitly states that 'This represents a new financing by Corning.' This indicates the company is diversifying its funding sources by issuing convertible debt.