KEMET (KEM) Postpones $125M Offering After Stock Falls 15%

Before the market opened this morning, KEMET Corp. (NYSE: KEM) announced its intentions to offer approximately $125 million in convertible senior notes, due 2027, to qualified institutional buyers. KEMET also gave an option for buyers to purchase up to an additional $25 million in notes, if necessary.

As equity offerings are generally viewed as a negative news item, shares of KEMET gapped lower when the market opened this morning. KEMET's stock price plunged about 15% and by noon, the stock had marked a new 52-week low at $5.30.

By this time, KEMET management had obviously noticed the dramatic decline in shares of its stock and just before 1:30 the Company issued a press release saying it would postpone the convertible senior note offering "due to volatile market conditions."

The announcement of the postponement caused shares of KEMET to feel a correction, moving up by about 11% right after the news hit.

KEMET Corporation, together with its subsidiaries, manufactures tantalum, multilayer ceramic, and solid aluminum capacitors.

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