Xerox says greenshoe exercised on convertible trust preferreds, now $1.035 billion

New York, Nov. 27 - Xerox Corp. said the underwriters exercised the 15% over-allotment option on its recent offering of convertible trust preferred securities, raising the total size to $1.035 billion.

The company originally priced $900 million of the securities after the market close on Nov. 19. That amount was itself increased from an initially discussed size of $500 million. With the $150 million greenshoe, the amount sold is now double the originally planned offering.

The Stamford, Conn. copier giant also said that it received previously announced financing from GE Capital Corp., including $835 million secured by portions of Xerox's lease receivables in the U.S., and $450 million secured by receivables in the U.K.

"The completion of these financing arrangements is further evidence of Xerox's strengthened financial position and the building confidence in Xerox's turnaround and return to profitability," said Barry D. Romeril, the company's vice chairman and chief financial officer, in a news release.

Xerox said it now has $3.6 billion in cash, including $230 million in defeasance to guarantee dividend payments on the convertibles.

The Xerox convertibles were priced via joint bookrunners Deutsche Banc Alex. Brown, Merrill Lynch & Co. and Salomon Smith Barney at a yield of 7.5% and an initial conversion premium of 25%.

Proceeds are to be used for general corporate purposes, including debt repayment.

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