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Baker Hughes, GE fall after offering priced at discount

Baker Hughes, GE fall after offering priced at discount
The logo of a General Electric (GE) facility is seen behind tree branches in Medford, Massachusetts, U.S., April 20, 2017. REUTERS/Brian Snyder   -   Copyright  Brian Snyder(Reuters)
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(Reuters) – Oilfield services company Baker Hughes <BHGE.N>, majority owned by General Electric Co <GE.N>, said a previously announced share offering was priced at a discount of 3.4 percent, sending shares of both companies lower on Wednesday.

The 92 million shares of Baker Hughes for sale by GE was priced at $23.00, below the stock’s $23.81 closing price on Tuesday, and came a day earlier than planned.

GE, which is struggling to rebuild its industrial businesses, said on Tuesday it would sell a portion of its stake in Baker Hughes to repay debt.

GE will be able to raise nearly $4 billion from the sale if underwriters exercise options to buy an additional 9.2 million shares, with Baker Hughes repurchasing another 65 million shares in a private transaction at a maximum aggregate of $1.5 billion.

The sale would bring down GE’s holdings in Baker Hughes to just north of a 50 percent stake, from 62.5 percent currently.

Shares of GE fell as much as 4.3 percent to $8.23, while Baker Hughes declined 5.3 percent to $22.55.

GE shares rallied as much as 13 percent before closing 7.8 percent higher in Tuesday’s session, while Baker Hughes gained more than 3 percent.

(Reporting by Ankit Ajmera in Bengaluru; Editing by Sriraj Kalluvila)

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