CMS Energy starts exchange for 3.375% convertible notes, 4.5% convertible preferreds

New York, Nov. 9 - CMS Energy Corp. announced an exchange offer for its $150 million 3.375% convertible senior notes due 2023 and its $250 million 4.5% perpetual convertible preferred stock.

The Jackson, Mich., energy company said it is making the exchange in response to new rules from the Financial Accounting Standards Board effective Dec. 15 that require issuers to treat contingent convertible securities as if they were fully converted when calculating diluted earnings per share.

The new securities being offered in the exchange will eliminate most of the dilutive effect, CMS said in a news release.

Holders who participate in the exchange will receive new convertibles with a net share settlement feature and a change-of-control provision. CMS will pay a fee of $2.50 per $1,000 principal amount for the 3.375% notes and $0.125 per $50 share of the preferreds.

The exchange runs through 5 p.m. ET on Dec. 9.

Morrow & Co. Inc. is the information agent (800 607-0088).

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