Chesapeake Energy says 97% of 6% convertible preferreds exchanged early

New York, Dec. 29 - Chesapeake Energy Corp. said holders of 3.897 million or 97% of its 4 million shares of 6% cumulative convertible preferred stock participated in its offer to exchange the securities early for common stock. It issued 20.755 million shares of common stock in exchange.

The transaction leaves 103,000 shares of the preferreds remaining.

On Dec. 27, Chesapeake Energy said it set pricing in the exchange offer at 5.3260 shares of common stock for each share of preferred stock.

The amount was fixed at 5 p.m. ET on Dec. 23 using a formula. The exchange ratio will be equal to the 4.8605 shares of common stock which the preferreds are currently convertible for, plus $7.75 worth of common stock, calculated as $7.75 divided by the volume-weighted average price over the 10 trading days ending on Dec. 23.

The ratio had a maximum of 5.5605 shares of common stock and a minimum of 5.1605 shares of common stock per share of preferred stock.

Chesapeake' stock traded at an average of $16.65 over the pricing period.

The exchange ended at midnight ET on Dec. 28.

UBS Securities LLC is dealer manager (888 722-9555, x4210 or collect at 203 719-4210). MacKenzie Partners Inc. is the information agent (800 322-2885 or collect at 212 929-5500).

Chesapeake Energy, an Oklahoma City-based independent natural gas producer, previously announced the forced conversion of all 2.71 million shares of its outstanding 6.75% cumulative convertible preferred stock into common stock on Nov. 22.

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