Netflix Stock Plunges After Rental Giant Sells $400M in Stock, Debt

Netflix moved to give itself a capital infusion on Monday, selling $400 million in stock and convertible bonds, the Los Gatos, Calif. company announced.

Half of that sum will be raised through the sale of common stock at $70 a share to mutual funds and accounts managed by T. Rowe Price Associates, while the other portion will be generated by the placing notes with funds affiliated with Technology Crossover Ventures (TCV).

The money will presumably be used to help the company meet the rising costs of streaming content and the continued financial burden of maintaining a DVD by mail business with its attendant postage fees. Netflix estimates that it will spend north of $3 billion next year for the rights to TV shows and movies.

Read Full Article from Reuters

- Posted: 2011-11-22 10:25:39

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