Marshall & Ilsley launches $400M stock offering (AP)
Thu, 11 Jun 2009 21:01:27 Etc/GM
Shares dropped 28 cents, or 4.4 percent, to close at $6.14. Stock offerings dilute current shareholders' stakes and shares of companies often sell off initially on such a move.
The Milwaukee-based bank said this offering is in place of a $350 million offering announced last month.
The bank also plans to give underwriters the option to buy up to an additional 15 percent of the shares sold. The offering is expected to raise about $384 million, which the bank said it will use for general corporate purposes.
M&I may also use some of the proceeds to repay part of a $1.7 billion investment received under the government's Troubled Asset Relief Program, or TARP. Such a move would first have to be approved by the bank's board and its regulators, M&I said.
Earlier this week, the government gave 10 large banks approval to return TARP funds. Many banks that received the bailout money have chafed under the increased government scrutiny and restrictions on executive compensation that are contingent with the investment.
M&I wasn't among the 19 largest U.S. banks to undergo the government's stress test analysis, so it wasn't ordered to raise additional capital. But analysts have still expressed concern over its capital levels.
M&I operates 375 branches primarily in Wisconsin, Arizona, Florida, Indiana and Minnesota.
source: http://biz.yahoo.com/ap/090611/us_marshall_ilsley_stock_offering.html?.v=2