Preferreds finish midweek session nearly flat; Miller Energy plans add-on to 10.5% paper

By Stephanie N. Rotondo

Phoenix, Aug. 20 – The preferred stock market was losing a little ground in early midweek trading but rebounded to end just slightly better on the day.

The Wells Fargo Hybrid and Preferred Securities index was down 5 basis points at mid-morning but came back to end up 1 bp.

Liquidity was improved over the last two days, but it was still “very quiet,” according to a trader.

“It’s just that time of year,” he said.

Miller Energy Resources Inc. added a new deal to the calendar Wednesday, announcing a follow-on “best efforts” offering of its 10.5% series D fixed-to-floating rate cumulative redeemable preferreds (NYSE: MILLPD).

“That’s about the only thing that going on today,” a trader said.

The preferreds traded off 43 cents, or 1.72%, to $24.57.

The oil and gas exploration and development company initially sold $25 million of the preferreds in September 2013.

MLV & Co. LLC and Maxim Group LLC are leading the deal, and Aegis Capital Corp., Ladenburg Thalmann, National Securities Corp. and Northland Capital Markets are acting as co-managers.

Beginning Dec. 1, 2018, the dividend begins to float at Libor plus 907.3 bps.

Recent deals ‘fell apart’

A trader said that Paragon Shipping Inc.’s recently priced $25 million issue of 8.375% $25-par senior notes due 2021 was an “interesting” deal, given that “the deal just fell apart.”

The trader said the new issue – which came on Aug. 5 – was in and of itself an “OK” deal, but that it was “syndicated very badly.”

He said the notes were trading in a $22.50 area.

The notes have yet to list on any exchange and “nobody knows when it is supposed to,” the trader said.

Still, he noted that “a lot of stuff that fell apart is coming back,” deeming that a “good sign” for the marketplace.”

One such deal is Northern Trust Corp.’s $400 million of 5.85% series C noncumulative perpetual preferreds that priced July 29.

Like Paragon, that deal also remains unlisted.

When Northern brought the deal it struggled to hit parity. But in the last week, the issue has attempted to edge higher.

The preferreds ended the session down 2 cents at $24.68.

Taylor Capital symbol changes

Earlier this week, MB Financial Inc. wrapped its takeover of Taylor Capital Group Inc., merging Cole Taylor Bank with MB Financial Bank.

A trader told Prospect News on Wednesday that due to the merger’s completion, Taylor Capital’s 8% series A noncumulative perpetual preferred stock had undergone a symbol change.

The new symbol is “MBFIP.” The old symbol was “TAYCO.”

The preferreds trade on the Nasdaq Global Select Market.

“I don’t think a lot of people saw that,” he said of the listing alteration.

The shares ended the day at $27.86, up 86 cents, or 3.19%.

© 2015 Prospect News.
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