GE today announced plans to offer at least $12 billion of common stock to the public. The underwriters will have a 30-day option to purchase shares representing an additional 15%of the offering amount from GE to cover over allotments, if any. The offering is expected to be priced prior to tomorrow's market open in the U.S.
In addition, GE announced that it has reached agreement to sell $3 billion of perpetual preferred stock in a private offering to Berkshire Hathaway, Inc. The perpetual preferred stock has a dividend of 10% and is callable after three years at a 10% premium. In conjunction with this offering, Berkshire Hathaway will also receive warrants to purchase $3 billion of common stock with a strike price of $22.25 per share, which is exercisable at any time for a five-year term.
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::HuffPost bloggers think this type of investment is a model for an alternative bailout ban
::Read about Buffett's Goldman Sachs deal and why analysts think neither that nor this Berkshire Hathaway GE deal is charity work.