Doral Financial plans exchange offer for 4.75% convertible preferreds

By Angela McDaniels

Tacoma, Wash., Aug. 26 - Doral Financial Corp. is planning an exchange offer for its 4.75% perpetual cumulative preferred stock, according to an S-4 filing with the Securities and Exchange Commission.

The company will offer shares of common stock in exchange for a portion of the convertibles. The exchange ratio and offer cap have not been determined.

Holders will also be asked to consent to an amendment to the certificate of designation for the convertibles that will eliminate the requirement that full dividends on the convertibles must have been declared and paid before the company redeems, repurchases or otherwise acquires shares of its 7% non-cumulative monthly income preferreds, series A, 8.35% non-cumulative monthly income preferreds, series B, and 7.25% non-cumulative monthly income preferreds, series C.

The company needs consents from holders of two-thirds of the outstanding convertibles in order to make the amendment.

Holders may deliver consents without tendering their convertibles, but those who tender must consent to the amendment.

UBS Investment Bank (888 719-4210 or 203 719-4210) will be the dealer manager. MacKenzie Partners, Inc. (212 929-5500 or 800 322-2885) will be the information agent.

Doral Financial is the San Juan, Puerto Rico-based parent of Doral Bank.

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