Fannie Mae, Freddie Mac preferreds tumble; NEAH GES to issue preferreds; Aegon dips

By Christine Van Dusen

Atlanta, Oct. 1 – Preferred stock from Fannie Mae and Freddie Mac plummeted on Wednesday after a federal judge dismissed lawsuits that alleged it was illegal for the mortgage corporations to funnel profits to the government in the form of dividends.

In response, the companies’ preferreds tumbled an average of 66% at the open, then took back half of that before closing down about 59% for the day, a market source said.

“To put that in dollar terms, it probably means the paper loss out there is close to $6 billion,” he said. “Big losses there.”

Overall, the preferred stock market was off by about 13 basis points on the day, or about three cents.

“Things were definitely more active than they have been,” he said.

On Wednesday morning, Aegon NV’s 6.375% perpetual capital securities dipped 8 cents to $25.36.

In other news on Wednesday, NEAH GES USA Inc. (GES) announced plans to issue $100 million of its preferred stock and senior notes maturing in 2019 and 2024.

The proceeds from the senior Rule 144A and Regulation S notes will be used to fund the proposed acquisition of South Africa-based Quemic’s operations in Ghana and Mozambique, to acquire United Kingdom-based Graspon Frankton Maritime and to purchase Bell twin engine 412 utility helicopters.

NEAH USA is part of Dubai-based NEAH Global Energy Solutions (GES), a power generation, infrastructure, maritime, aviation and logistics provider based in Dubai.

© 2015 Prospect News.
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