Varco Offers Overdue Dividends Swap

Varco International Inc. in Orange is offering to exchange 3.75 shares of its common stock for each share of its $2 Class A convertible preferred stock to try to eliminate $3 million of overdue dividend payments--as well as future dividend payments--to holders of the preferred shares.

The offer, due to expire on Sept. 25, has an indicated value of $27.19 for each preferred share, or a total of $13.6 million. That is nearly twice the amount that holders of 500,000 shares of the Class A preferred stock could get under terms of the original 1983 purchase agreement. Varco makes pipe-handling equipment for use in oil and gas drilling.