Spark prices add-on; Global Net to reopen preferreds; Freddie, Fannie decline continues

By Abigail W. Adams

Portland, Me., Jan. 23 – While the primary market has brought no new deals forward this week, two existing deals will see add-ons.

Spark Energy, Inc. priced a 2 million share add-on to its $25-par 8.75% series A fixed-to-floating rate perpetual cumulative redeemable preferred stock at a public offering price of $25.25 after the market close on Tuesday.

B. Riley FBR, Janney Montgomery Scott, BB&T Capital Markets and Ladenburg Thalmann are joint bookrunners for the deal, which carries a greenshoe of 250,000 shares.

The preferred stock was initially priced in March 2017 with $35 million sold. Additional preferreds have been issued through an at-the-market program, raising the total to $42.6 million.

The preferreds will carry a dividend of 8.75% until April 15, 2022 and then switch to a dividend of Libor plus 657.8 basis points.

The series A preferred stock is listed on Nasdaq under the symbol “SPKEP.” The preferred stock was down 1.4079 cents, or 5.27%, to $25.29 at market close Tuesday.

Global Net Lease, Inc. plans to reopen its $25-par 7.25% series A perpetual cumulative redeemable preferred stock issued in September and December of 2017.

Global Net sold $106 million of its series A preferred stock in the initial pricing of the offering in September 2017 and an additional $28.75 million in a reopening in December.

The New York-based real estate investment trust’s series A preferred stock is listed on the New York Stock Exchange under the symbol “GNLPrA.” The preferred stock was up 14 cents, or 0.57%, to $24.9 in early trading on Tuesday.

The overall secondary market was up on Tuesday. The iShares US Preferred Stock ETF was up 0.26% at market close and the Wells Fargo Hybrid & Preferred Securities Financial Index was up 17 bps.

While the overall market was up, Fannie Mae’s and Freddie Mac’s embattled preferred stock continued to trade down as Congress debates the future of the government-sponsored enterprises.

Fannie Mae’s series O variable-rate preferred stock, which trades on the OTC markets under the ticker “FNMFN,” was down 90 cents, or 6.82%, to $12.30 at market close Tuesday.

Fannie Mae’s 6.75% series Q non-cumulative preferred stock, which trades on the OTC markets under the ticker “FNMAI,” was down 41 cents, or 6.07%, to $6.34.

Freddie Mac’s 5.66% non-cumulative perpetual preferred stock, which trades on OTC markets under the ticker “FMCKN,” was down 25 cents, or 4.00%, to $6.00.

Freddie Mac’s 5% non-cumulative preferred stock, which trades on OTC markets under the ticker “FMCKK,” was down 70 cents, or 5.76%, to $11.45.

Freddie Mac’s 8.375% non-cumulative perpetual convertible preferred stock, which trades on OTC markets under the ticker “FMCKJ,” was down 38 cents, or 5.03%, to $7.17.

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