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Best equity deal
Dominion Resources
Type of deal: Follow-on equity offering
Deal size: $621 million ($680 million with greenshoe)
Date: May 2003
Underwriter: Lehman Brothers
Rival bankers were astounded at the terms Lehman Brothers offered to win the mandate for Dominion Resources' follow-on equity deal. "It sounded crazy at the time," says one banker. "They were charging less than $900,000 to take on $620 million of risk. We were scratching our heads trying to work out what angle they had. We even wondered whether they'd simply made a typo in the e-mail."
They are fair questions to ask of equity deals such as Dominion's. The company rang up the equity capital markets desks of the major banks and investment banks they deal with at just after 4pm on May 20, telling them to be on a conference call at 4.15pm to hear the...
