Why Fluor Stock Tanked 11% at the Open Today
Shares of Fluor (NYSE: FLR), a large engineering and construction company, fell sharply at the open on May 13, losing roughly 11% of their value in the first few minutes of trading. The news likely driving this decline came out after the close on May 12. Clearly investors didn't like what they read.
Fluor announced yesterday that it intends to sell a cumulative perpetual convertible preferred stock with a face value of $1,000 per share. The proceeds are expected to be used to repay other debt. The plan is to issue 450,000 shares in a private placement, with the initial purchasers being granted the option of adding another 67,500 shares to that figure. The company can not redeem these preferred shares, but it can force conversion under certain circumstances. Buyers can convert the preferred shares into stock at any time.
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Source Fool.com
