General Electric Co. (NYSE: GE) has priced its massive secondary offering this morning of 547.8 million shares at a substantial discount of $22.25 per share. It has also given underwriters an overallotment option to buy 82.2 million shares.
Book-running managers are Banc of America, Citi, Deutsche Bank, GoldmanSachs, J.P. Morgan, and Morgan Stanley. The lead managers were listedas Barclays Capital, Credit Suisse, and UBS.
GE closed yesterday at $24.50 and its trading range yesterday was$21.65 to $25.75. Yesterday’s low was its 52-week low. Its 52-weekhigh is $42.11.
This is a tale called "Good News, Bad News" where you don’t know if thewinner lost or the one who lost actually won. The good news is that GEkeeps its "AAA" rating and is proving that companies can still raisecapital. The bad news is that this offering is at a large discount and sets thebar much lower for companies with less solid balance sheets.
We have an opening print of $22.83 for GE and on last look shares weretrading at $22.59 and almost 50 million shares have already traded in less than 10 minutes.
Jon C. Ogg
October 2, 2008
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