Verizon Prices Offering Of Senior Zero-Coupon Convertible Notes
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NEW YORK -- Verizon Communications Inc. (NYSE:VZ) announced today that it has agreed
to sell zero-coupon convertible notes due 2021 through its financing subsidiary, Verizon
Global Funding, in a private offering resulting in gross proceeds of approximately $3
billion. The initial purchasers will also have a 30-day option to purchase up to an
additional $450 million of notes to cover over-allotments.
The notes will be convertible into shares of Verizon common stock at an initial price of
$69.50 per share if the closing price of Verizon common stock on the New York Stock Exchange
exceeds specified levels or in certain other circumstances. The conversion price increases
by 3 percent a year, resulting in a conversion price of $75.99 per share in the third year,
when holders may first put the notes, and $80.66 per share in the fifth year, when Verizon
may call the notes. Noteholders may also put the notes to Verizon in the fifth, 10th and 15th
The initial conversion price represents a 25 percent premium over the May 8, 2001 closing
price of $55.60 per share. At the initial conversion, each $1,000 principal amount of notes
will be convertible into 7.9318 shares of Verizon common stock. There are no scheduled cash
interest payments associated with the notes.
The purpose of the offering is to obtain low-cost funds for general corporate purposes.
This news release does not constitute an offer to sell or the solicitation of an offer to buy
securities. The offering is being made only to qualified institutional buyers. The
convertible securities and the shares of common stock issuable upon conversion of the
convertible securities have not been registered under the United States or state securities
laws and may not be offered or sold in the United States absent registration or an applicable
exemption from the registration requirements.
Verizon Communications (NYSE:VZ) is one of the world's leading providers of communications
services. Verizon companies are the largest providers of wireline and wireless
communications in the United States, with 112 million access line equivalents and 27 million
wireless customers. Verizon is also the largest directory publisher in the world. A Fortune
10 company with approximately 260,000 employees and more than $65 billion in annual revenues,
Verizon's global presence extends to 40 countries in the Americas, Europe, Asia and the
Pacific. For more information on Verizon, visit www.verizon.com.