El Paso Corp. (ticker: EP, exchange: New York Stock Exchange (.N))
News Release -
El Paso Corporation Announces Mandatory Conversion of Its 4.99% Convertible Perpetual Preferred Stock
HOUSTON, TX, Mar 10, 2011 (MARKETWIRE via COMTEX) -- El Paso Corporation (NYSE: EP) today announced that it is exercising its mandatory conversion right related to all outstanding shares of its 4.99% Convertible Perpetual Preferred Stock (the "Preferred Stock"). The mandatory conversion date will be March 11, 2011 (the "Mandatory Conversion Date").
Upon mandatory conversion, holders of Preferred Stock will be entitled to receive 77.2295 shares of El Paso common stock, par value $3.00 per share ("Common Stock"), for each share of Preferred Stock converted. A total of up to 57,922,125 shares of Common Stock will be issued upon conversion of the Preferred Stock. Cash will be paid in lieu of fractional shares of Common Stock.
El Paso expects the conversion of shares to further strengthen its credit profile while providing $35 million of annual cash savings. The conversion does not impact the company's previously announced 2011 adjusted diluted earnings per share guidance.
On and after the Mandatory Conversion Date, dividends will cease to accrue on the Preferred Stock and all rights of holders of the Preferred Stock will terminate except for the right to receive the number of whole shares of Common Stock issuable upon conversion of the Preferred Stock and cash, in lieu of any fractional shares of Common Stock. No payment or adjustment will be made upon conversion of the Preferred Stock for accumulated dividends.
El Paso Corporation provides natural gas and related energy products in a safe, efficient, and dependable manner. The company owns North America's largest interstate natural gas pipeline system, one of North America's largest independent oil and natural gas producers and an emerging midstream business. For more information, visit www.elpaso.com.
Cautionary Statement Regarding Forward-Looking Statements
This release may include forward-looking statements and projections. The company has made every reasonable effort to ensure that any information and assumptions on which any such statements and projections are based are current, reasonable, and complete. Important factors which could cause actual results to differ materially from those in any forward-looking statement are set forth in the company's filings with the Securities and Exchange Commission and other public disclosures. While the company makes any such statements and projections in good faith, neither the company nor its management can guarantee that anticipated future results will be achieved. Reference must be made to those filings for additional important factors that may affect actual results. The company assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the company, whether as a result of new information, future events, or otherwise.
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SOURCE: El Paso Corporation