By midday, shares had tumbled 6.2% to $20.39. Trading volume of 3.2 million was nearly triple its three-month daily average.
The tobacconist said it would offer $225 million worth of its variable interest convertible senior notes due 2020. Vector Group will offer also offer up to an aggregate of $258.8 million if the underwriter, Jefferies, accepts its over-allotment option in full. The senior notes will offer cash interest at a rate of 1.75% a year.
The offering is expected to close March 24, pursuant to customary closing conditions.
The Miami-based business intends to use the net proceeds of the offering for general corporate purposes, including real estate investments. A portion of capital raised may also be used in upcoming debt maturities.
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TheStreet Ratings team rates VECTOR GROUP LTD as a Hold with a ratings score of C. The team has this to say about their recommendation:
"We rate VECTOR GROUP LTD (VGR) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and compelling growth in net income. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good."