Talisman Energy Inc (TLM.TO) shares have shed 43 cents in morning trade, to hit $12.22. Talisman continues its slide from Dec 5, when it achieved a high of $14.
Close to 5 million shares have changed hands.
Talisman shares have been trending downwards since last Monday. The company announced then it had agreed to issue to a syndicate of underwriters led by RBC Capital Markets and CIBC for distribution to the public 8,000,000 Cumulative Redeemable Rate Reset First Preferred Shares, Series 1. The Series 1 Preferred Shares will be issued at a price of $25.00 per Series 1 Preferred Share, for aggregate gross proceeds of $200 million.
Holders of the Series 1 Preferred Shares will be entitled to receive a cumulative quarterly fixed dividend at an annual rate of 4.20% for the initial period ending December 31, 2016. Thereafter, the dividend rate will be reset every five years at a rate equal to the 5-year Government of Canada bond yield plus 2.77%.
Holders of Series 1 Preferred Shares will have the right, at their option, to convert their shares into Cumulative Redeemable Rate Reset First Preferred Shares, Series 2, subject to certain conditions, on December 31, 2016 and on December 31 every five years thereafter. Holders of the Series 2 Preferred Shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada Treasury Bill yield plus 2.77%.
The net proceeds from this offering will be used to contribute to funding capital projects, reducing indebtedness and for general corporate purposes, as the need may arise and as management may consider appropriate at the time. The offering is expected to close on or about December 13, 2011.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
