Chesapeake Energy announces mandatory conversion of 5% preferreds

By Jennifer Chiou

New York, April 16 - Chesapeake Energy Corp. said it will convert all 5,000 shares of its 5% cumulative convertible preferred stock on May 3.

The Oklahoma City-based oil and gas exploration and production company said that the preferreds will be automatically converted into a number of shares equal to $100.00 divided by the lesser of the conversion price, which is anticipated to be $25.55, and the average of the closing prices of the company's common stock for the five trading days ending on April 29.

Chesapeake's shares (NYSE: CHK) closed at $24.37 per share on April 15.

The company said that cash will be paid in lieu of fractional shares of common stock.

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