Preferred stock primary calendar builds up; Plains All American, Seaspan deals on tap

By Stephanie N. Rotondo

Seattle, Oct. 2 – The preferred stock primary was revving up on Monday, with three new deals getting added to the calendar.

Plains All American Pipeline LP said it was selling series B fixed-to-floating rate cumulative redeemable preferred units.

A market source speculated that the units would be $1,000-par, though it was unclear, based on the information circulating about the deal – which was not much.

“I don’t think they are actually marketing it yet,” he said. “My guess is they are marketing tomorrow.”

But the source added that he had not even seen price talk related to the deal.

“It’s weird that there were no headlines” other than the various rating agencies issuing their rating on the new issue, the source said.

S&P Global Ratings and Fitch Ratings both gave the deal a BB rating, while Moody’s Investors Service gave it a Ba3.

J.P. Morgan Securities LLC, BofA Merrill Lynch, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are running the books.

The units will not be listed.

Proceeds will be used to repay amounts outstanding under the company’s credit facilities and commercial paper program as well as for general partnership purposes.

Meanwhile, Seaspan Corp. said it was offering $25-par senior unsecured notes due 2027 via RBC Capital Markets LLC and Stifel Nicolaus & Co. Inc.

Initial price talk is 7.125% to 7.25%, according to a source.

Though pricing details were not available as of 6 p.m. ET, a source noted that the deal was launched at 7.125%.

Seaspan’s existing preferred issues were mixed on the announcement.

The 8.2% series G cumulative redeemable preferreds (NYSE: SSWPrG) were initially up but eventually closed off a penny at $24.19. The7.875% series H cumulative redeemable preferreds (NYSE: SSWPrH) followed that trend, first trading up, then losing ground.

The preferreds ended the day at $23.70, down 2 cents.

The 7.95% series D cumulative redeemable preferreds (NYSE: SSWPrD) were meantime 13 cents higher, trading at $24.08.

As for the company’s 6.375% $25-par notes due 2019 (NYSE: SSWN), they were off 12 cents at $25.80.

And, rounding out the day’s new issue announcements, Sotherly Hotels Inc. said it was planning an underwritten public offering of series C cumulative redeemable preferred stock.

Price talk on the deal – which also had not priced as of 6 p.m. ET – is 7.75% to 8%, a source reported. The deal is expected to be $35 million, though “it could grow,” the source said.

Sandler O’Neill + Partners LP and Janney Montgomery Scott LLC are acting as joint bookrunners.

The company said it will use the funds to redeem in full is 7% $25-par notes due 2019 (Nasdaq: SOHOM).

The notes were off a penny in early dealings but closed up a like amount at $25.54.

© 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.