Chesapeake Energy Corporation (ticker: CHK) announced on May 23, 2016, the company plans to issue debt in exchange for equity. Chesapeake announced that about 5 percent of the company’s outstanding shares will be exchanged for equity, the second such transaction this month.
From the Chesapeake Enrgy 8-k: “From May 16, 2016 through May 23, 2016, the Company has issued or agreed to issue an aggregate of 37,080,617 shares of Common Stock, representing approximately 5.2% of the Company’s outstanding Common Stock, in exchange for: (i) $81.5 million aggregate principal amount of its 2.5% Contingent Convertible Senior Notes due 2037 (with May 2017 put rights); (ii) $26.5 million aggregate principal amount of its 6.5% Senior Notes due 2017; (iii) $7.5 million aggregate principal amount of its 2.25% Contingent Convertible Senior Notes due 2038 (with 2018 put rights); and (iv) $50.5 million aggregate principal amount of its Floating Rate Senior Notes due 2019 Outstanding Senior Notes.”
In total, the four exchanges amount to 37.1 million shares in exchange for senior notes worth about $166 million.
Chesapeake swapped $153 million of debt for about 4 percent of its equity earlier this month.
