FEIC ($39-38) P/E 42 Beats by 5 cents,Rev's rose 20%,(announces that it intends to sell roughly $100 mln convertible notes through a private offering)
FEI to sell $100 mln conv notes, says earnings up
July 23, 2001 6:07:00 PM ET
HILLSBORO, Oregon, July 23 (Reuters) - FEI Co. (FEIC), which supplies equipment to the semiconductor and data storage markets, said on Monday it plans to privately sell about $100 million of seven-year convertible subordinated notes.
Separately, the Hillsboro, Oregon-based company reported second-quarter net income after charges of $8.6 million, or 27 cents per diluted share, up from $4.2 million, or 15 cents per diluted share, a year ago. Net sales for the second quarter rose 21 percent to $94 million from $77.8 million a year ago, it said.
FEI said it may sell $25 million more convertible notes if there is enough demand. It said it intends to use net proceeds for working capital and other general corporate purposes.
It also said it expects the notes will be noncallable for three years, and that noteholders will be able to require FEI to buy back the notes upon a change in control in the company.
Shares of FEI closed Monday on the Nasdaq at $39.72, down 17 cents. Their 52-week closing high is $42.10, set on June 7. Their 52-week closing low is $15.88, set last December 20.
A convertible bond is a hybrid security that usually offers current income, and can be converted into company stock. Its fortune is closely tied to the underlying stock price. Shares often fall after a company announces a convertible sale because some investors sell the underlying stock short, the bonds may dilute the stock and bondholders rank ahead of shareholders in a company's capital structure. REUTERS
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