Winthrop prices $70 million add-on; Maiden prices, sees little action; NextEra to sell bonds

By Stephanie N. Rotondo

Portland, Ore., March 20 - Preferred stocks finished flat again on Tuesday, market sources reported.

In the primary market, Winthrop Realty Trust priced an add-on to its 9.25% series D cumulative redeemable preferreds. The company originally announced the deal Monday. In both sessions, the existing preferreds were seen trading downward.

Maiden Holdings North America Ltd. also priced a deal late in the day. However, it was getting little play from investors.

NextEra Energy Capital Holdings Inc. said it is planning an offering of baby bonds due 2072. Pricing was expected Tuesday but failed to occur. Still, the deal was "holding in there fine" in gray market trading, a trader said.

Meanwhile, the secondary market saw a fair bit of action in Wachovia Corp. preferreds. A source said the action came as investors were attempting to figure out which issues parent company Wells Fargo & Co. intends to call.

Winthrop prices add-on

Winthrop Realty Trust priced a $70 million add-on to its 9.25% series D cumulative redeemable perpetual preferred shares of beneficial interest on Tuesday.

The original issuance occurred Nov. 28. The company issued $40 million, or 1.6 million, of the preferreds at that time.

In the reopening, Winthrop is selling 2.8 million preferreds at a premium to par. The price is $25.0385, a slight discount to Monday's closing price of $25.17. The preferreds (NYSE: FURPD) closed down 15 cents at $25.02 on Tuesday.

The underwriters have a $10.55 million over-allotment option and received a $0.7875 per share discount.

Barclays Capital Inc., Stifel, Nicolaus & Co. Inc. and Jefferies & Co. Inc. are the joint bookrunners. Credit Suisse Securities (USA) LLC and KeyBanc Capital Markets Inc. are acting as joint lead managers, and JMP Securities LLC is acting as a co-manager.

Settlement is expected Friday.

Winthrop intends to use the proceeds to fund future acquisitions, pay down credit facility borrowings, repurchase its common shares and for general working capital purposes, including funding capital expenditures, tenant improvements and leasing commissions.

Winthrop is a Boston-based real estate investment trust.

Maiden getting no love

Maiden Holdings North America plans to issue $100 million of 8% senior notes due March 27, 2042, a market source told Prospect News on Tuesday.

Maiden Holdings Ltd. fully and unconditionally guarantees the $25-par notes.

The company originally announced the deal Monday, and just $50 million of the bonds were expected to be offered. Pricing was in line with talk.

There is a $15 million over-allotment option.

Sources were seeing very little goings-on in the new issue.

"Nobody has much info on it," a trader said before the deal priced late Tuesday. "There's no change in price talk. But I haven't seen a market on it in a while."

Another trader said he had not seen a two-sided market since the deal was first announced on Monday.

Maiden will apply to list the notes on the New York Stock Exchange. Settlement is expected March 27, the company said in a press release.

Bank of America Merrill Lynch is the bookrunner.

Proceeds will be used for general corporate purposes, which may include repurchasing the company's 14% 30-year trust preferreds or for working capital.

Maiden Holdings is a Hamilton, Bermuda-based reinsurance company.

NextEra to sell baby bonds

NextEra Energy Capital Holdings plans to offer at least $150 million of $25-par series G junior subordinated debentures due March 1, 2072.

Price guidance is around 5.75%, a trader reported. The deal was expected to price Tuesday, but it had not come as of press time.

NextEra Energy Inc. will unconditionally and irrevocably guarantee the notes, the company said in a regulatory filing.

"It's holding in there fine," a trader said, seeing a less 18 cent bid, less 12 cent offered market in the gray.

"It's a pretty decent deal," said another market source. He said the paper hit a high of $24.95, going out at $24.85 bid, $24.90 offered.

NextEra will apply to list the baby bonds on the New York Stock Exchange.

Citigroup Global Markets Inc., Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC are the joint bookrunners. Raymond James & Associates Inc. and RBC Capital Markets LLC are the junior co-managers.

The company expects to use proceeds to repay a portion of its total outstanding commercial paper obligations and for other general corporate purposes.

NextEra Energy is based in Juno Beach, Fla.

Investors push Wachovia around

Wachovia paper made the day's most active list. "People are trying to speculate, especially around that name, because they said they would be calling more issues," a market source said.

Wachovia Capital Trust IV's 6.375% trust preferreds (NYSE: WBPB) - an $875 million issue that Wells Fargo said it will redeem on April 13 - traded up a penny to $25.11. Wachovia Preferred Funding Corp.'s 7.25% noncumulative exchangeable perpetual series A preferreds (NYSE: WNAP), however, dipped a penny to $25.71.

Holders will receive 100% of par for the 6.375% trust preferreds plus accrued dividends of about 13.3 cents, and the redemption will be funded with excess cash on hand.

The redemption is consistent with Wells Fargo's plan to eliminate securities that no longer qualify as tier 1 capital. That plan received approval from the Federal Reserve.

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