Starwood greenshoe ups 4.5% three-year convertibles to $172.5 million

By Susanna Moon

Chicago, Oct. 14 – Starwood Waypoint Residential Trust underwriters fully exercised their $22.5 million over-allotment option on the company’s 4.5% three-year convertible senior notes, bringing the total deal size to $172.5 million.

As previously announced, Starwood priced $150 million of the convertibles after the market close on Oct. 7 with a 20% initial conversion premium.

The deal came at the cheap end of talk for a yield of 4% to 4.5% and a conversion premium of 20% to 25%.

J.P. Morgan Securities LLC, Citigroup Global Markets Inc. and BofA Merrill Lynch were the joint bookrunners for the Rule 144A offering.

The conversion price is $30.04. The notes are contingently convertible and have net share settlement.

Proceeds are expected to be used to acquire additional homes and distressed and non-performing residential mortgage loans, to repurchase common shares and for general business purposes.

Oakland, Calif.-based Starwood is a REIT that acquires, renovates, leases, maintains and manages single-family homes.

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