By Marisa Wong
Los Angeles, Aug. 17 – KeyCorp priced $600 million of series H fixed-rate reset perpetual non-cumulative preferred stock (expected: Baa3/BB+/BB+) on Wednesday, according to an FWP filing with the Securities and Exchange Commission.
Each $25-par depositary share will represent a 1/40th interest in a share of the preferred stock.
The dividend is fixed at 6.2% initially and resets on Dec. 15, 2027 and every five years after that to a rate equal to five-year Treasuries plus 313.2 basis points.
The preferreds can be redeemed at par on the first reset date and then on any dividend payment date going forward.
There is a 30-day over-allotment option, according to a previously filed 424B3 filing with the SEC.
The joint bookrunners are BofA Securities, Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, Wells Fargo Securities, LLC, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, KeyBanc Capital Markets Inc. and RBC Capital Markets, LLC.
Proceeds will be used for general corporate purposes, which may include working capital, capital expenditures, investments in loans to subsidiaries, refinancing of outstanding debt, refinancing of outstanding capital securities, share repurchases, dividends, funding potential future acquisitions and satisfaction of other obligations.
KeyCorp is applying to list the preferreds on the New York Stock Exchange under the symbol “KEYPrL.”
KeyCorp is a Cleveland-based financial services company.
| Issuer: | KeyCorp
|
| Amount: | $600 million (24 million depositary shares)
|
| Issue: | Fixed-rate reset non-cumulative preferred stock, series H
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| Maturity: | Perpetual
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| Bookrunners: | BofA Securities, Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, Wells Fargo Securities, LLC, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, KeyBanc Capital Markets Inc. and RBC Capital Markets, LLC
|
| Depositary: | Computershare Trust Co., NA and Computershare Inc. (jointly)
|
| Counsel to issuer: | Squire Patton Boggs (US) LLP
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| Counsel to underwriters: | Sidley Austin LLP
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| Dividend: | 6.2% initially, resets on Dec. 15, 2027 and every five years after that to five-year Treasuries plus 313.2 bps
|
| Price: | Par of $25.00
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| Pricing date: | Aug. 17
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| Settlement date: | Aug. 24
|
| Expected ratings: | Moody’s: Baa3
|
| S&P: BB+
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| Fitch: BB+
|
| Distribution: | SEC registered
|
| Listing: | NYSE: KEYPrL
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| Cusip: | 493267843
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