IBM Corp has responded to the loss of its blue chip triple-A credit rating by seeking permission from shareholders to start issuing preferred stock, likely in the form of fixed term convertibles, a measure that would enable it to raise money more cheaply while ensuring that present management will be long gone by the time the principle has to be repaid or new shares issued. By issuing convertible preferred stock, IBM would be able to pay a lower rate of interest on the money raised than it can on straight debt securities because of the potential for uplift as its share price – it hopes – rises. The company reveals the plan in the proxy materials for its annual meeting. In the proxy, IBM says preferred stock could be used to pay for acquisitions or equity alliances with other companies, adding that no such deals are currently cooking. And for those fascinated by other peoples’ money, John Akers made $1.58m last year in salary and stock, down about 40% from 1990, when saw an rise of about 35%. President Jack Kuehler made $959,962; the three other top IBM officials on the management committee were paid from $750,013 to $699,971.
