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American Capital Agency Prices Stock Issue

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February 28, 2013 | Comments (1)

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American Capital Agency (NASDAQ: AGNC  ) has unveiled the pricing of its latest stock flotation. The company, which is to issue 50 million shares of common stock in a public offering, said it anticipated $1.58 billion in proceeds before expenses from the issue. That would equate to a price of roughly $31.60 per share.

Additionally, the firm said that it had granted the underwriters of the issue a 30-day option to buy up to an additional 7.5 million shares. This offering is expected to close on March 5.

Those underwriters include Bank of America's Merrill Lynch unit, Credit Suisse (NYSE: CS  ) , Goldman Sachs, JPMorgan Chase affiliate J.P. Morgan Securities, and Morgan Stanley (NYSE: MS  ) .

American Capital Agency said it would use the proceeds of the issue "to acquire additional agency securities as market conditions warrant and for general corporate purposes."

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Fool contributor Eric Volkman has no position in any stocks mentioned. The Motley Fool recommends Goldman Sachs. The Motley Fool owns shares of Bank of America and JPMorgan Chase & Co.. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 01, 2013, at 8:32 AM, jonkai3 wrote:

    uh, ya you should be worried, they just isssued stock at less than what their book value was...

    that is a big red flag, and they believe that their book value will be even worse after they issue their next earnings report.

    you don't do that unless you are in a bind...

    As i said before shareholders are not going to be very happy this year, the days of fake book value increases from issuing shares are gone...

    now they actually have to earn some money, and they have not been doing a good job of that from the spread. considering the dividend...

    they also would not of issued this until after they announced the dividend, but before giving it if the dividend was going to be the same...

    and for those touting "total return" by using the stock price have just had their heads handed to them, as i said they would....

    including 34 million shares that were issued at $33.70, and another about 10 million at $31 and change... ask them about an MReit price appreciation....

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