Technitrol Shares Fall As Company Plans Note Sale

NEW YORK (AP) — Shares of Technitrol Inc. tumbled Wednesday after the electronics components maker said it will sell $50 million in convertible senior notes in a private offering.

The stock fell 85 cents, or 16 percent, to $4.56 in afternoon trading.

Technitrol, which is based in Trevose, Pa., said it will use the estimated $46 million in proceeds from the 7 percent notes to pay down a credit line. The notes mature in 2014.

In a client note Wednesday, CL King analyst Michael Gallo estimated the notes, if converted, could dilute the value of existing shares by 17 percent, which "would take away some of the potential benefit of a cyclical recovery and likely pressure the shares short-term."

Gallo cut his price target for the stock to $7 from $9 but kept an "Accumulate" rating.

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