Legacy talks fixed-to-floating cumulative preferreds at 8% to 8.25%

By Stephanie N. Rotondo

Phoenix, April 10 - Legacy Reserves LP will sell series A fixed-to-floating rate cumulative redeemable preferred units, the company said in a prospectus filed with the Securities and Exchange Commission on Thursday.

Price talk is 8% to 8.25%, according to a trader.

Stifel Nicolaus & Co. Inc., Barclays Capital Inc. and MLV & Co. LLC are the joint bookrunning managers. Janney Montgomery Scott LLC and Ladenburg Thalmann & Co. Inc. are the co-managers.

Dividends will be payable on the 15th of each month. The dividend will be fixed through 2024, at which time it will begin floating at Libor plus a spread.

The company can redeem the units beginning in 2019 or upon a change of control. The redemption price is par plus accrued dividends.

The Midland, Texas-based oil and natural gas company intends to list the units on the Nasdaq Global Select Market under the ticker symbol "LGCYP."

Proceeds will be used for the pending acquisition of properties in Chaves County, N.M., and Sheridan County, Mont., for an aggregate purchase price of $112 million in cash. Legacy will also use proceeds for general partnership purposes. Pending use of the funds for other reasons, the company will apply the net proceeds to its revolving credit facility.

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