Fluor announces $500 million convertible bond offering and plans to redeem all of its 3.500% senior notes due 2024

Fluor Corp.’s stock
FLR,
+15.56%
fell 1.1% in premarket trade Monday, after the engineering and construction services company announced a private offering of $500 million of convertible bonds due 2029. In connection with the deal, the company is also engaging in capped call transactions that aim to minimize dilution of the stock upon conversion of the bonds to stock. Proceeds of the deal will be used to cover the cost of the capped call transactions and to redeem all of its outstanding 3.500% senior notes due 2024. The company has launched a cash tender offer for those notes concurrent with the convertible bond offering. The stock has gained 3.7% in the year to date, while the S&P 500
SPX,
-0.53%
has gained 17%.