Summary
Corning Incorporated (GLW) announced on August 26, 2002, that the underwriters had exercised their option to purchase an additional 750,000 shares of its 7% Series C Mandatory Convertible Preferred Stock. This follows the initial purchase of 5,000,000 shares on July 31, 2002, bringing the total value of this preferred stock offering to $575 million ($500 million initial + $75 million option exercise). This action represents a new financing by Corning, utilized under its existing $5 billion universal shelf registration statement. These preferred shares are designed to convert mandatorily into Corning's common stock on August 16, 2005. Each share carries a 7.0% annual dividend. This financing event indicates Corning's strategy to raise capital, potentially to support its operations or growth initiatives in the telecommunications, display technologies, and advanced materials markets. Investors should note the details of the mandatory conversion terms and the potential dilutive effect on common stock at the time of conversion.
Key Highlights
- 1Underwriters exercised an option to purchase an additional 750,000 shares of 7% Series C Mandatory Convertible Preferred Stock.
- 2This increases the total amount raised from this preferred stock offering to $575 million.
- 3The preferred stock pays a 7.0% annual dividend.
- 4The shares are mandatorily convertible into Corning's common stock on August 16, 2005.
- 5The conversion ratio will be between 50.813 and 62.5 shares of common stock per preferred share.
- 6This financing was conducted under Corning's existing $5 billion universal shelf registration statement.
- 7The offering was managed by Salomon Smith Barney, JPMorgan, and Goldman, Sachs & Co.