WaMu Boosts Preferred Offering
Washington Mutual
(WM) - Get Report
boosted its offering of convertible preferred stock to 3 million shares, projecting net proceeds of $2.9 billion.
The offering -- originally expected to be 2.5 million shares -- priced late Tuesday, and was expected to have
solid demand.
The Seattle-based financial giant plans to initially contribute $1 billion in proceeds to its bank to help shore up its capital.
WaMu announced late Monday that it would offer the stock, as well as slash its dividend and cut jobs, as part of plan to improve its balance sheet, which has been ravaged by the meltdown in mortgage-related markets.
The new preferred stock will pay dividends in cash at a rate of 7.75% per year. The first dividend payment date will be March 15.
Each share of the preferred stock will be convertible at any time into 47.0535 shares of common stock of the company, which represents an approximate initial conversion price of $21.25 per share.
Shares of WaMu were climbing 85 cents, or 4.9%, to $18.27 in early trading Wednesday.








