Montpelier Re upsizes; Kayne Anderson MLP to bring new issue; Ally's series A preferreds fall

By Stephanie N. Rotondo

Portland, Ore., May 3 - New issues started to pick up again in the preferred stock market on Tuesday.

One deal from Montpelier Re Holdings Ltd. priced during the session, while another from Kayne Anderson MLP Investment Co. was announced. A trader said he expects the latter transaction to price on Wednesday.

"With the 10-year [Treasury bonds] trading around 3.25%, the preferreds are creeping up in price," the trader said. "I imagine we'll keep seeing these small deals."

Though the preferred market was generally steady Tuesday, another market source noted that Ally Financial Inc. - once again the day's most active issue - traded down and on no news.

Montpelier deal prices

Montpelier Re Holdings priced an upsized offering of 8.875% perpetual preferreds Tuesday.

As previously reported, price talk was in the 9% area, and a trader opined that it would come in the "high-8s."

The market had also expected $75 million, or 3 million shares, of the preferreds to be sold, but the company actually issued $150 million, or 6 million shares.

The price per share is $25.00. A trader said there was a $24.90 bid in the gray market.

"It should do OK," the trader said. "Good yield and small deal."

Montpelier Re is a Bermuda-based reinsurance company.

Kayne plans new issue

Kayne Anderson MLP is reported to be bringing $50 million, or 2 million shares, of series D mandatorily redeemable preferred stock to market.

A trader said price talk is around 5% and pricing is expected Wednesday.

Kayne Anderson is a closed-end investment fund with offices in Houston and Los Angeles.

Ally series As fall

Ally Financial's 8.125% series A preferreds (NYSE: ALLY-PA) were the day's most actively traded preferred, a market source said.

However, while the rest of the market was generally treading water, the series As fell 19 cents to $26.01.

The preferreds closed Monday at $26.20 and opened Tuesday at $26.05.

There was no news out on the Detroit-based bank.

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