Thursday January 21, 10:13 am Eastern Time
Company Press Release
Unisys Calls Additional 6 Million Shares of Series A Cumulative Convertible Preferred Stock Following Retirement of Approximately 2.2 Million Shares
Actions will be accretive to 1999 earnings per share
BLUE BELL, Pa.--(BUSINESS WIRE)--Jan. 21, 1999-- Unisys Corporation (NYSE: UIS - news) announced today that it will call for redemption an additional 6 million shares of the remaining 26.2 million outstanding shares of its Series A Cumulative Convertible Preferred Stock, which pays an annual dividend of $3.75.
This action follows the company's previously announced call of 2 million shares of the preferred stock, which was completed today. During the call period approximately 2.2 million shares of preferred stock were retired, including about 200,000 uncalled shares that were voluntarily converted into Unisys common stock.
Cash redemptions during the period were approximately $13 million. Overall, actions taken so far will reduce the company's annual preferred stock dividend payments by more than $30 million and will be accretive to 1999 earnings per share.
''We were pleased with the results of the first partial call,'' said Unisys Chairman and CEO Lawrence A. Weinbach. ''The fact we retired 2.2 million shares of preferred stock during the call period was a clear bonus.
''Based on this response and our continued strong cash flow, we are calling a larger block of shares for redemption. We are focused on eliminating -- as quickly and expediently as possible -- the $106 million of annual preferred stock dividends as part of our ongoing program to strengthen our financial structure and return Unisys to investment-grade status.''
The 6 million shares being called will be redeemed on March 4, 1999 at the stated redemption price of $50 per share plus accrued dividends of approximately 49 cents per share.
The Series A Preferred Stock is convertible at any time into shares of Unisys common stock, at the option of the holder, at a conversion price of $29.93, or approximately 1.67 shares of common stock for each preferred share converted.
Unisys common stock yesterday closed at $34. As long as the market price of the common stock is at least $30.25, holders of the preferred stock who elect to convert will receive common stock with a market value greater than the redemption price of $50 plus accrued dividends.
Unisys said that, based on the results of its initial partial call and the additional shares that were converted, the company had issued 3.2 million shares of common stock, increasing the number of common shares outstanding to approximately 261 million.
The partial call announced today is being carried out under the terms of the Series A Preferred Stock in the company's certificate of incorporation. Shares will be chosen for redemption by a lottery conducted by Harris Trust and Savings Bank, which will act as both redemption and conversion agent.
The company's transfer books on the Series A Preferred Stock will be closed from the close of business on January 28, 1999 through the close of business on February 1, 1999 for the purpose of selecting the shares to be redeemed.
Formal notice and procedures for surrendering shares for redemption or conversion will be mailed to the selected stockholders of record by Harris Trust on February 2, 1999. Beneficial holders of preferred stock will be notified by their respective brokers about selection of shares for redemption.
Shareholders with questions can contact Harris Trust at 800/245-7630 or write to Harris Trust and Savings Bank, c/o Harris Trust Company of New York, Wall Street Plaza, 88 Pine Street, 19th Floor, New York, NY 10005.
Unisys is a registered trademark of Unisys Corporation. |
