Entertainment Properties plans $125 million convertible preferreds, talked at 5.5%-5.75%, up 20%-24%

By Kenneth Lim

Boston, Dec. 18 - Entertainment Properties Trust plans to price $125 million of perpetual convertible preferred stock, talked at a dividend of 5.5% to 5.75% and an initial conversion premium of 20% to 24%. Pricing is expected Tuesday after the market close.

The preferred shares will be offered at par of $25 apiece.

There is an over-allotment option for a further $18.75 million.

Bear Stearns is the bookrunner of the registered off-the-shelf offering.

The company may convert the preferreds only after the first five years, subject to a hurdle at 130% of the conversion price.

The preferreds have dividend protection for quarterly cash payouts above 68.75 cents per common share and takeover protection in the form of a make-whole premium.

Entertainment Properties, a Kansas City, Mo.-based real estate investment trust that owns entertainment retail centers, cinemas and other entertainment-related properties, said it will use the proceeds of the deal to fund general corporate purposes, including acquisitions, and to reduce debt under a KeyBank facility.

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