Canada #65
Boeing Offers 90 Million Shares & $5 Billion Depositary Shares To Boost Liquidity
by Tyler Durden Monday, Oct 28, 2024
Boeing's money raise officially hit this AM. The offering: 90 million shares of common stock and $5 billion in depositary shares.
Goldman Sachs, BofA Securities, Citigroup, JPMorgan are leading the deal as joint bookrunning managers for both offerings.
Here are the offering details from Boeing:
The Boeing Company [NYSE: BA] ("Boeing" or the "Company") announced today the launch of concurrent separate underwritten public offerings of (i) 90,000,000 shares of common stock, par value $5.00 per share ("Common Stock") of the Company and (ii) $5 billion of depositary shares ("Depositary Shares"), each representing a 1/20th interest in a share of newly issued Series A Mandatory Convertible Preferred Stock, par value $1.00 per share ("Preferred Stock"), of the Company (together, the "Offerings"). Boeing expects to grant to the underwriters of the Offerings a 30-day option to purchase up to an additional (i) 13,500,000 shares of Common Stock and (ii) $750 million of Depositary Shares, solely to cover over-allotments, if any. Boeing intends to use the net proceeds from the Offerings for general corporate purposes, which may include, among other things, repayment of debt, additions to working capital, capital expenditures, and funding and investments in the Company's subsidiaries.
Holders of the Depositary Shares will be entitled to a proportional fractional interest in the rights and preferences of the Preferred Stock, including conversion, dividend, liquidation and voting rights, subject to the provisions of a deposit agreement. The Preferred Stock is expected to have a liquidation preference of $1,000 per share. Unless earlier converted, each share of Preferred Stock will automatically convert, for settlement on or about October 15, 2027, into a variable number of shares of Common Stock based on the applicable conversion rate, and each Depositary Share will automatically convert into a number of shares of Common Stock equal to a proportionate fractional interest in such shares of Common Stock. The dividend rate, conversion terms and other terms of the Preferred Stock will be determined at the time of pricing of the offering of the Depositary Shares. Currently, there is no public market for the Depositary Shares or the Preferred Stock. Boeing intends to apply to list the Depositary Shares on the New York Stock Exchange under the symbol "BA.PRA."
Goldman blasted an email to clients this AM: "We are a joint bookrunner in this registered Follow On offering with the following indicative terms."
Boeing shares moved lower in premarket trading in New York after a Bloomberg report revealed a capital raise could take place as soon as Monday. This would prevent credit rating agencies from downgrading Boeing's investment-grade credit rating to speculative territory amid dwindling cash reserves and a drawn-out strike.
Three sources familiar with the matter said the beleaguered airplane maker, plagued by a months-long strike, could raise as much as $15 billion, adding the amount could change depending on demand.
Boeing's advisers have been lining up a funding deal for weeks.
These are dire times for Boeing…
More:
https://www.zerohedge.com/markets/boeing-offers-90-million-shares-5-billion-depositary-shares-boost-liquidity