Cheniere Energy Drops then Pops after Stock Offering

Shares of Cheniere Energy LNG are seeing some volatility this morning after the company announced a registered direct offering of common stock. Cheniere Energy entered into a definitive agreement with institutional investors to sell 31,000,000 shares of its common stock at a negotiated price per share of $15.10. The offering is expected to close and settle on May 10, 2012. The Company intends to use the net proceeds from the offering of approximately $467.9 million to invest in Cheniere Energy Partners, L.P. in exchange for equity securities anticipated to be issued in connection with the financing of Cheniere Partners' proposed Sabine Pass liquefaction project. Cheniere Energy initially fell over 5% after the offering was announced; however, currently, shares are trading down only 1.4% at $16.23 per share.