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DIAMOND SHAMROCK ANNOUNCES COMPLETION OF PRIVATE PLACEMENT OF CONVERTIBLE PREFERRED STOCK

 SAN ANTONIO, Texas, June 11 /PRNewswire/ -- Diamond Shamrock, Inc. announced today it has completed the sale of 1,725,000 shares of cumulative convertible preferred stock, which included 225,000 shares to cover over-allotments. The issue was priced at $50 per share with a coupon of 5 percent. The shares were sold in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933. The stock is convertible into Diamond Shamrock's common stock after Sept. 8, 1993, at an initial conversion price of $26.50 per share. After June 15, 1996, the stock is redeemable, subject to certain conditions, for common stock and after June 15, 2000, it is redeemable at par for cash. Lehman Brothers was the lead manager of the issue, with Merrill Lynch & Co., co-manager.
 The net proceeds of approximately $85 million will be used to increase the company's financial flexibility and to facilitate the company's taking advantage of changes and opportunities that may develop in the downstream industry. Pending such use, the proceeds from the offering will be used primarily to repay short-term borrowings.
 Diamond Shamrock CEO, Chairman, and President Roger Hemminghaus said, "We are very pleased with the outcome of this transaction. The proceeds increase our ability to seize opportunities in the marketplace and to focus our growth on our distribution and marketing systems."
 Commenting on current operations, Hemminghaus said, "Although refining margins have weakened over the last two weeks, we are still running ahead of last year's second quarter margins, and as we move into the driving season, our retail operations continue on a strong trend. The Three Rivers refinery expansion is essentially complete. We expect this project to contribute to our earnings during the second half of the year."
 Diamond Shamrock, Inc., (NYSE: DRM), with annual sales of approximately $2.6 billion, is an independent refiner and marketer of petroleum products. The San Antonio-based corporation has two Texas refineries, markets gasoline through approximately 2,000 Diamond Shamrock outlets, manufactures and markets petrochemicals, and stores and markets natural gas liquids.
 -0- 6/11/93
 /CONTACT: Bill Strain, Investor Relations, of Diamond Shamrock, Inc., 210-641-8708/
 (DRM)


CO: Diamond Shamrock, Inc. ST: Texas IN: OIL SU:

LR -- NY018 -- 0981 06/11/93 09:50 EST
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Publication:PR Newswire
Date:Jun 11, 1993
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