Diamond Sports taps $1,000-par market; Allstate lower; New Residential weaker

By James McCandless

San Antonio, Aug. 23 – The preferred space closed lower on Friday as worries over the global trade climate frazzled markets.

Diamond Sports Holdings LLC, a unit of Sinclair Broadcast Group Inc., issued $1,025,000,000 of $1,000-par perpetual preferred equity with an initial dividend of one-month Libor plus 800 basis points.

In the secondary market, Allstate Corp.’s 5.1% series H fixed-rate non-cumulative perpetual preferred stock were big movers and ended lower with the market.

Sector peer Aspen Insurance Holdings Ltd.’s 5.625% non-cumulative perpetual preference shares followed the trend.

Elsewhere, REIT New Residential Investment Corp.’s 7.125% series B fixed-to-floating rate cumulative redeemable preferreds were weaker.

Public Storage’s 4.95% series D cumulative preferred stock ended worse off.

In finance, Bank of America Corp.’s 6% series GG non-cumulative preferred stock also saw a modest dip.

Diamond Sports prices

Diamond Sports Holdings LLC, a unit of Sinclair Broadcast Group Inc., issued $1,025,000,000 of $1,000-par perpetual preferred equity with an initial dividend of one-month Libor plus 800 basis points.

There is no greenshoe.

The dividend is subject to a 0.75% Libor floor. After three years, the dividend steps up annually by 50 bps, subject to a cap of one-month Libor plus 1,050 bps. After 8.5 years, the dividend steps up by 150 bps, subject to increases of 50 bps every six months thereafter.

The dividend will increase by 200 bps if Diamond Sports Holdings does not redeem the preferreds upon a change-of-control, subject to a cap of one-month Libor plus 1,400 bps

The preferreds are callable 91 days after the closing date at par. From 91 days to 181 days, they are redeemable at 102%, after the first year to the third year at 103%, after the third year and before the fourth year at 101% and after the fourth year at par.

Allstate lower

Leading the secondary in volume, Allstate’s 5.1% series H fixed-rate non-cumulative perpetual preferred stock closed lower.

The preferreds (NYSE: ALLPrH) were down 6 cents to $25.89 on volume of about 521,000 shares.

On Thursday, the preferreds picked up 9 cents.

Sector peer Aspen Insurance’s 5.625% non-cumulative perpetual preference shares also followed the day’s trend.

The preferreds (NYSE: AHLPrE) dropped 19 cents to close at $25.49 with about 262,000 shares trading.

On Thursday, the preferreds added 3 cents.

New Residential off

Elsewhere, real estate investment trust New Residential’s 7.125% series B fixed-to-floating rate cumulative redeemable preferreds were weaker.

The preferreds (NYSE: NRZPrB) lost 6 cents to close at $24.94 on volume of about 273,000 shares.

On Thursday, the preferreds fell 8 cents.

Public Storage’s 4.95% series D cumulative preferred stock ended the session worse off.

The preferreds (NYSE: PSAPrD) declined by 8 cents to close at $25.87 with about 158,000 shares trading.

On Thursday, the preferreds were off by 1 cent.

Bank of America dips

In the finance space, Bank of America’s 6% series GG non-cumulative preferred stock saw a modest dip.

The preferreds (NYSE: BACPrB) dipped 6 cents to close at $27.00 on volume of about 235,000 shares.

Indexes down

The Wells Fargo Hybrid & Preferred Securities Financial index finished the week down by 0.26%, reversing a 0.02% gain in early Friday trading.

The iShares US Preferred Stock ETF was down 16 cents to $37.32.

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