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Investing

Eaton’s Secondary Pricing Reflects Discounting (ETN)

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By Douglas A. McIntyre Updated Published
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Eaton Corp. (NYSE: ETN) priced a common stock offering for 17.5 million shares at $84.00 per share for gross proceeds of $1.43 billion this morning. Its market cap is roughly $12.4 billion.

Joint book-running managers, Citi, JPMorgan, and Morgan Stanley, and other co-managers were granted 1.75 million shares for over-allotments.  Banc of America, KeyBanc Capital Markets were also in the syndicates and the smaller co-managers are as follows: Barclays Capital, BNP Paribas, BNY Capital Markets, Deutsche Bank Securities, Goldman Sachs, and Merrill Lynch.

The proceeds for the electrical systems manufacturer will be used for debt repayments from two previous acquisitions.   

Shares had been sliding ahead of this pricing, with levels of over $90.00 seen just last Friday.  Eaton shares are down this morning by $0.77 to $84.12. The 52-week range is $66.27 to $104.12. Based on that huge haircut shares have seen ahead of the pricing, this looks like the dilution has been mostly factored in.

You can join our open email distribution list to hear about other key financings, secondary offerings, IPO’s, and other special situation previews.

Rachel Lopez
April 23, 2008

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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