Chesapeake Energy Suspends Preferred Stock Dividends, Saves $170M

Last Friday MDN told you that Rex Energy, a small pure play driller focused totally on the Marcellus/Utica has suspended paying dividends on their preferred stock in order to conserve cash and not be forced to keep borrowing money to keep the doors open and the drill bits turning (see Rex Energy Suspends Preferred Stock Dividends to Conserve Cash). A company 54 times bigger than Rex (by market capitalization, as of this morning), Chesapeake Energy, is now using the same strategy. On Friday Chessy announced they are suspending quarterly preferred stock dividends. Shares of those stocks plunged to 13 cents on the dollar on the news, rebounded some, and plunged back down again. Doug “the ax” Lawler, CEO of Chesapeake, said suspending the dividends will let the company keep $170 million in the bank…

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