By Stephanie N. Rotondo
Seattle, Jan. 13 – Two Harbors Investment Corp. priced $250 million of convertible senior notes due 2022 at par to yield 6.25% with an initial conversion premium of 13.5% on Friday, the company said in a press release.
The conversion price is $10.00 per share, representing a conversion rate of 100 shares per each $1,000 of notes.
The yield came at the cheap end the 6% to 6.25% yield talk and on top of the premium talk.
Credit Suisse Securities (USA) LLC is the bookrunner.
There is a $37.5 million over-allotment option.
There are standard change of control, anti-dilution and dividend protections, the source noted. The issue cannot be redeemed prior to maturity, but holders can require a repurchase in certain circumstances.
Conversions will be settled with common stock.
Proceeds will be used to fund the business and investment activities of the company and its subsidiaries, which may include acquisitions, and for general corporate purposes.
Two Harbors is a New York-based real estate investment trust that invests in residential mortgage-backed securities, mortgage servicing rights, commercial real estate and other financial assets.
| Issuer: | Two Harbors Investment Corp.
|
| Securities: | Convertible senior notes
|
| Amount: | $250 million
|
| Greenshoe: | $37.5 million
|
| Maturity: | Jan. 15, 2022
|
| Bookrunner: | Credit Suisse Securities (USA) LLC
|
| Coupon: | 6.25%
|
| Price: | Par of $1,000
|
| Yield: | 6.25%
|
| Conversion premium: | 13.5%
|
| Conversion price: | $10.00 per share
|
| Conversion rate: | 100 shares
|
| Pricing date: | Jan. 13
|
| Settlement date: | Jan. 19
|
| Talk: | 6% to 6.25%, with a conversion premium of 13.5%
|
| Stock symbol: | NYSE: TWO
|
| Stock price: | $8.81 as of Jan. 12 close
|
| Market capitalization: | $3.02 billion
|
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