By Kenneth Lim
Boston, Dec. 20 - Entertainment Properties Trust on Tuesday priced an upsized $135 million of perpetual convertible preferred stock at the cheap end of talk, reoffered at 24.50 with a dividend rate of 5.75% and an initial conversion premium of 20%.
The preferreds were initially expected to be offered at par of 25 and were talked at a dividend of 5.5% to 5.75% and an initial conversion premium of 20% to 24%.
The size of the offering was originally $125 million. The over-allotment option was reduced to an additional $15 million from an additional $18.75 million.
Bear Stearns was 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 135% of the conversion price. That hurdle was increased from 130% prior to pricing.
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 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.
| Issuer: | Entertainment Properties Trust
|
| Issue: | Convertible preferred stock
|
| Bookrunner: | Bear Stearns
|
| Amount: | $135 million
|
| Greenshoe: | $15 million
|
| Maturity: | Perpetual
|
| Dividend: | 5.75%
|
| Price: | Par of $25, reoffered at $24.50
|
| Yield: | 5.75%
|
| Conversion premium: | 20%
|
| Conversion price: | $71.34
|
| Conversion ratio: | 0.3504
|
| Dividend protection: | For quarterly common dividend above 68.75 cents per share
|
| Takeover protection: | Yes
|
| Company conversion protection: | Non-convertible by company before Jan. 15, 2012, thereafter convertible by company subject to 135% hurdle
|
| Puts: | None
|
| Price talk: | 5.5%-5.75%, up 20%-24%
|
| Pricing date: | Dec. 19, after the close
|
| Settlement date: | Dec. 22
|
| Distribution: | Registered
|
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