By Kenneth Lim
Boston, July 21 - Essex Property Trust Inc. early Friday priced $130 million of convertible preferred shares at the cheap end of talk, at a dividend of 4.875% and an initial conversion premium of 18%.
The 5.2 million preferreds were offered at par of $25, and price talk for the overnight deal was for a dividend between 4.375% and 4.875% and an initial conversion premium between 18% and 22%. The initial conversion price is $136.62 per common share. Essex common stock (NYSE: ESS) closed at $115.78 on Thursday.
There is a greenshoe for a further 780,000 preferred shares worth $19.5 million.
Banc of America Securities LLC was the bookrunner of the registered deal.
The preferreds are non-callable for the first five years, after which they may be called subject to a 130% hurdle.
There will be dividend protection for payouts on the common above the current 84 cents per quarter.
Essex, a Palo Alto, Calif.-based real estate investment trust, has a portfolio of residential properties on the West Coast. It will use the proceeds of the deal to pay down its outstanding debt that currently bear a blended interest rate of 5.76%, to fund its development pipeline and for general purposes.
Issuer: | Essex Property Trust Inc.
|
Issue: | Convertible preferred stock
|
Bookrunner: | Banc of America Securities LLC
|
Amount: | $130 million
|
Greenshoe: | $19.5 million
|
Maturity: | Perpetual
|
Dividend: | 4.875%
|
Price: | Par of $25
|
Yield: | 4.875%
|
Conversion premium: | 18%
|
Conversion price: | $136.62
|
Conversion ratio: | 0.183
|
Dividend protection: | For common stock dividends above 84 cents per quarter
|
Call protection: | Non-callable 5 years, thereafter callable subject to 130% hurdle
|
Price talk: | 4.375%-4.875%, up 18%-22%
|
Pricing date: | July 21, before the open
|
Settlement date: | July 26
|
Distribution: | Registered
|
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.