August 9, 2004 — (WEB HOST INDUSTRY REVIEW) — Web hosting and Internet services provider XO Communications (xo.com) announced on Monday that it has completed a private placement of six percent class “A” convertible preferred stock, raising $200 million. XO privately offered the shares of preferred stock to XO stockholders that currently hold an aggregate of approximately 85 percent of XO’s outstanding common stock. Carl Icahn, chairman and owner of the company, holds around 50 percent of the company’s common stock. His affiliates purchased $190 million of the preferred stock.
r
r
“This agreement demonstrates continued support for XO’s ability to execute in the market and our goal of achieving free cash flow positive,” says Carl Grivner, CEO of XO Communications. “The proceeds will be used for our ongoing operations, continued investments in new customer solutions like voice-over IP services and potential acquisitions that would provide our business with additional scale and cost synergies.”
r
r
Each share of preferred stock is initially convertible at $4.62 per share into 10.82251 shares of XO common stock.
