AOL 0.75% convertibles see conversion rate step up on Verizon merger

New York, June 23 – AOL Inc.’s 0.75% convertible senior notes due 2019 will have an increased conversion rate through July 20, following closing of the acquisition of the issuer by Verizon Communications Inc.

Starting Tuesday, the conversion rate will be 21.4244 shares per $1,000 principal amount, an increase of 3.9788 shares, according to an 8-K filing with the Securities and Exchange Commission.

The additional shares are required under the make-whole fundamental change provisions of the notes.

AOL also announced that following closure of the merger on Tuesday that notes will now convert into cash rather than stock.

In addition, closing of the acquisition by Verizon triggered the fundamental change repurchase provision included in the note indenture. As a result, holders can put the convertibles at par plus accrued interest on July 21.

Verizon announced on May 12 that it had agreed to acquire AOL for $50.00 per share in cash for a total of $4.4 billion.

Verizon is a New York-based telecommunications company. AOL, also based in New York, provides digital content and advertising platforms.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.