The deal, originally planned for $1bn, is understood to have been considerably augmented to $1.75bn. Lucent was also able to improve the terms of the offering, although they remained generous.
The deal which was lead-managed by Morgan Stanley and Salomon Smith Barney, will improve Lucent’s financial flexibility and is likely to help the company renegotiate a $4bn credit facility.
It will also add to the company’s cash pile as it seeks to implement its latest round of restructuring, which will lead to the loss of up to 20,000 jobs.
Strong demand also allowed the company to improve the terms of the offer. The preferred shares will carry an 8% coupon, down from the 8.5-9.0% that was originally planned. Meanwhile, the premium to convert the securities to ordinary shares was increased from 16 to 22%. Lucent shares closed down $0.57 at $6.31.
