Financially beleaguered Chrysler Corp. got some good news yesterday. Its 10-million-share Ireferred stock financing, with a convertible warrant attached, was over-subscribed, providing the company with a much-needed $250 million in new equity.

The underwriting is believed to be the largest convertible preferred offering ever. Originally set for 6 million shares, the underwriting was increased to 10 million shares a few days ago when it was clear it would be oversubscribed.

The money will provide Chrysler with part of the $.5 billion it estimates it needs over the next five years to overhaul its model lines and meet government safety and fuel-economy regulations.

There had been some anticipation in financial circles that Chrysler might have a hard time raising even its initial target because of poor earnings and some recent bad publicity about the safety of its Omni and Horizon subcompacts. The company has reported a $120 million loss for the first quarter of 1978 and expects to be in the red by that amount for the full year. Consumers Union last week labeled Chrysler's star-performing Omni and Horizon "unacceptable" because of alleged handling difficulties.

But Richard Gillette, the managing director of the Merrill Lynch White Weld Capital Markets Group, which was the lead manager in the 147-firm underwriting syndicate, said investors were snapping up the Chrysler issue "because they view the company as a turnaround situation."

"The terms were very attractive and it encouraged people to speculate on the company's recovery," he said.

Chrysler was offering a $25-a-share preferred stock with a $2.75 dividend for an 11 percent yeild. In addition, the purchaser also gets one-half warrant with each share, and each full warrant is convertible into one common share of Chrysler at $13. Chrysler yesterday closed at $11 on the New York Stock Exchange.

"History has shown that this is a highly salable structuring with a high coupon and an equity kicker that provides a warrant at a relatively low lowing the underwriting. Gillette

Besides the high interest it is offering on the preferred shares, Chrysler had to pay a large sum to the underwriters and brokers who distributed the offering. The total cost to the company was $15 million, or $1.50 a share. The brokers who placed the shares received $1 each as their selling concession. The underwriting fee was 20 cents a share, and the management fee was another 30 cents.

The Chrysler preferred shares traded between $24.25 and 24.75 fol-conversion premium," said Gillette, said he would "classify this as the perfect aftermarket, with trading right within the selling concession." He said this indicated the yield had not been too rich despite demand being over-subscribed.