Tsakos Energy added to new issue calendar; Sotherly, Miller Energy price; JPMorgan slips

By Stephanie N. Rotondo

Phoenix, Sept. 25 - More new deals were hitting the tape in the preferred stock market on Wednesday.

Tsakos Energy Navigation Ltd., an Athens, Greece-based ocean shipping company, said it was planning an offering of series C cumulative redeemable perpetual preferreds.

Price talk is around 8.875%, according to a trader.

"It's not trading around much [in the gray market]," the trader said, seeing an offer of less 10 cents at midday. "They still might have the book pretty open to people."

No official word had surfaced as to whether the deal priced or not by the end of business.

Of deals that did in fact price, a trader commented that he had not seen anything in Sotherly Hotels LP's $24 million of 8% $25-par senior notes due 2018, a deal that priced early in the session on Wednesday.

"It's a tiny deal," he said. "Anybody that wanted it could have gotten it probably."

Late in the session, Miller Energy Resources Inc. said it had also priced a deal, a $25 million offering of 10.5% series D fixed-to-floating rate cumulative redeemable preferreds.

As for other recently priced deals, Morgan Stanley & Co. Inc.'s $750 million of 7.125% series E fixed-to-floating rate noncumulative preferreds were "hanging right around" a $25.15 to $25.20 context, the trader said. He noted that the deal was a little unusual, as it freed from the syndicate shortly after pricing on Tuesday.

Meanwhile, the Allstate Corp.'s $350 million of 6.75% series C fixed-rate noncumulative preferreds were "creeping up" to $24.86 bid, $24.90 offered.

That issue priced Monday and freed up on Tuesday.

Looking forward, the trader said he had not heard of any deals coming to market but speculated that "we could see a busier calendar with the bond market being relatively stable."

Overall, the market was in the green, as the Wells Fargo Hybrid and Preferred Securities index rose 9 basis points, or just of 2 cents on average for $25-par securities.

JPMorgan declines

JPMorgan Chase & Co.'s preferreds were weaker Wednesday as it was reported the bank was looking to settle a mortgage securities probe for as much as $11 billion.

The 5.45% series P noncumulative preferreds (NYSE: JPMPA) fell 19 cents to $21.35. The 5.5% series O noncumulative preferreds (NYSE: JPMPD) declined just as much, ending at $21.42.

The bank is being investigated by both federal and state authorities over its role in the marketing of subprime mortgage securities - the same securities that ultimately led to economic downfall of 2008. Though a deal has not yet been reached and the $11 billion figure could change, Reuters quoted a "person familiar with the matter" as saying the number was "realistic."

The settlement would likely include a partial cash payment and partial consumer relief.

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