CommonWealth REIT to price cumulative perpetual preferreds; size heard to be $150 million

By Stephanie N. Rotondo

Portland, Ore., May 25 - The week's second new preferred stock issue was announced Wednesday, and a trader said the deal was already performing well.

CommonWealth REIT said in a regulatory filing that it plans to issue series E cumulative redeemable perpetual preferreds. However, there were few definitive details in the filing, and the deal did not price by day's end.

According to a market source, the company is selling $150 million, or 6 million shares, of the preferreds.

A trader said the yet-to-be-priced issue was already trading at $24.80 in the gray market.

"So far so good," he said.

Proceeds will be used to pay down the real estate investment trust's revolving credit facility and for general business purposes, including future acquisitions.

The performance of the new issue echoes that of Endurance Specialty Holdings Ltd.'s deal that came Tuesday. That issue - a $230 million issue of 7.5% non-cumulative series B perpetual preferreds - quickly traded up to $24.98 bid, $25.03 offered in the gray on Tuesday.

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