BofA plans share offerting

BofA will offer two types of equity offering for $6 billion:

• Perpetual preferred shares: these are quasi equity/ debt or somewhere in between. The security will entitle holder to receive fixed dividend amount with no growth in dividends and generally these shares have limited upside. But unlike debt they can be outstanding forever, at least theoretically.
• Convertible preferred shares: similar to the above but after Jan 2013 holders can convert them to equity and as a result any holder of BofA common share will get his ownership diluted.

The split of the $6 billion between the two types is still not clear. The prospectus that BofA filed with the SEC has not identified several pieces of information like dividend rate and such.