By Rebecca Melvin
New York, May 15 - Spirit Realty Capital Inc. priced an upsized $650 million of convertible senior notes at par in five- and seven-year tranches, which came at the rich end of talked terms, according to a pricing term sheet.
The seven-year tranche was upsized to $300 million from $200 million, while the five-year tranche remained at $350 million in size. There is a greenshoe for up to $97.5 million of addition bonds, or $52.5 million additional notes for the 2019 notes and up to $45 million of additional notes for the 2021 notes, which was upsized from $30 million.
The 2019 notes have a 2.875% coupon, which came at the rich end of 2.875% to 3.375% coupon talk.
The upsized 2021 notes have a 3.75% coupon, which came at the rich end of 3.75% to 4.25% talk.
Both tranches have a 22.5% initial conversion premium, which was the rich end of 17.5% to 22.5% talk.
Concurrently Spirit Realty priced 23 million shares of common stock at $10.69 per share, for about $271.2 million of proceeds. There is a greenshoe for up to 3.45 million of additional shares.
Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC and RBC Capital Markets Inc. were the joint bookrunners of the registered, off-the-shelf convertibles deal.
The notes are non-callable for life with no puts, and they have takeover protection.
Proceeds will be used to defease some of the company's mortgage debt, to repay an outstanding balance under its revolving credit facility, to fund potential further acquisitions and for general corporate purposes.
Scottsdale, Ariz.-based Spirit is a real estate investment trust focused on primarily commercial properties.
| Issuer: | Spirit Realty Capital Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $650 million, upsized from $550 million
|
| Greenshoe: | $97.5 million, upsized from $82.5 million
|
| Bookrunners: | Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets LLC
|
| Co-managers: | Robert W. Baird & Co. Inc., Capital One Securities Inc., Raymond James & Associates Inc., SunTrust Robinson Humphrey Inc.
|
| Concurrent stock offering: | $271.2 million, or 23 million shares at $10.69 each
|
| Conversion premium: | 22.5%
|
| Conversion price: | $13.10
|
| Conversion ratio: | 76.3636 shares
|
| Takeover protection: | Yes
|
| Call protection: | Non-callable
|
| Puts: | None
|
| Pricing date: | May 14
|
| Settlement date: | May 20
|
| Stock symbol: | NYSE: SRC
|
| Stock reference price: | $10.69
|
| Distribution: | Registered, off the shelf
|
| Market capitalization: | $3.89 billion
|
|
|
| Notes due 2019
|
| Amount: | $350 million
|
| Greenshoe: | $52.5 million
|
| Maturity: | May 15, 2019
|
| Coupon: | 2.875%
|
| Price: | Par
|
| Yield: | 2.875%
|
| Price talk: | 2.875% to 3.375%
|
|
|
| Notes due 2021
|
| Amount: | $300 million, upsized from $200 million
|
| Greenshoe: | $45 million, upsized from $30 million
|
| Maturity: | May 15, 2021
|
| Coupon: | 3.75%
|
| Price: | Par
|
| Yield: | 3.75%
|
| Price talk: | 3.75% to 4.25%
|
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