Network Equipment buys back $32.7 million convertibles at below par

By Susanna Moon

Chicago, Nov. 24 - Network Equipment Technologies, Inc. said it repurchased $32.7 million of its convertible securities at less than the face value of the bonds.

As a result, the company will recognize a gain of about $14.5 million from these transactions.

Following these repurchases, the company now has outstanding $23.5 million of 3¾% convertible senior notes and $23.7 million of 7¼% convertible subordinated debentures.

"Given the current financial market environment, we were able to retire a portion of our outstanding debt on what we believe to be favorable terms," John F. McGrath, Jr., vice president and chief financial officer, said in a press release.

"These repurchases will reduce our future interest obligations and will also eliminate the potential dilution to our stockholders that could have occurred if the repurchased notes were to have been converted into common stock."

The company said it may buy back more shares depending on market conditions.

"We are cognizant, however, of the value of strong cash balances in these difficult times and will carefully weigh these competing considerations," McGrath noted.

Network Equipment Technologies is a Fremont, Calif.-based voice and data communications equipment producer.

© 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.