Discover Financial greenshoe exercised, ups preferreds to $575 million

By Tali David

Minneapolis, Oct. 16 - Discover Financial Services, Inc. said the over-allotment option on its series B fixed-rate non-cumulative perpetual preferred stock was exercised in full, increasing the offering by 3 million shares or $75 million, according to an 8-K filed with the Securities and Exchange Commission.

The company priced $500 million of the preferreds on Oct. 9.

The joint bookrunners are Bank of America Merrill Lynch, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, UBS Securities LLC and Wells Fargo Securities LLC.

As previously reported, each preferred has a liquidation preference of $1,000. The securities will be issued as $25 depositary shares each representing a 1/40th interest in a preferred.

Proceeds will be used for general corporate purposes, which may include advances to subsidiaries to finance their activities, repayment of outstanding debt and repurchases and redemptions of issued and outstanding securities of Discover Financial Services and its subsidiaries.

Discover Financial Services is a Riverwoods, Ill.-based direct banking and payment services company.

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