El Paso exercises mandatory conversion right on 4.99% convertibles

By Toni Weeks

San Diego, March 10 - El Paso Corp. announced that it will exercise its mandatory conversion right for all of its 4.99% convertible perpetual preferred stock on March 11.

Holders of preferred stock will receive 77.2295 shares of El Paso common stock for each preferred converted. Up to 57,922,125 shares of common stock will be issued upon conversion.

According to a press release, El Paso expects the conversion of the preferreds to further strengthen its credit profile while providing $35 million in annual cash savings. The conversion does not impact the company's previously announced 2011 adjusted diluted earnings per share guidance.

Based in Houston, the company provides natural gas and related energy products.

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