Hitachi Falls on News to Raise $4.6B

TOKYO (TheStreet) -- Hitachi(HIT Quote), the technology giant and Japan's fourth-largest company, plans to raise about $4.6 billion by selling $1.1 billion in convertible bonds and about 1 billion shares of stock.

Shares of Hitachi fell more than 8% in trading in Tokyo.

Hitachi plans to use the funds to invest in growth businesses, reorganize its activities and pay off debt.

The company may sell 400 million shares to Japanese investors and 600 million shares to foreign buyers at a price to be fixed between Dec. 7 and Dec. 10, Bloomberg reports. According to an e-mail sent to investors by Nomura Holdings, one of the sale arrangers, the shares may be sold a discount of 3% to 5%.

The stock sale would increase Hitachi's outstanding shares by as much as 34.1%, The convertible bonds, maturing in five years, also may increase the number of outstanding stock by 7.8% after a conversion. Total proceeds, excluding commissions, may be as much as 415.7 billion yen, Bloomberg said.

Hitachi, like other Japanese companies such as Toshiba, NEC and Nomura(NMR Quote), is using the equity route to raise funds as markets recover.