By Wendy Van Sickle
Columbus, Ohio, Aug. 9 – Telephone and Data Systems Inc. priced $600 million of 6% $25-par cumulative redeemable perpetual preferred stock (Ba3/B/BB-) at par on Monday, according to a 424B5 filing with the Securities and Exchange Commission.
There is a $90 million greenshoe.
Dividends will be payable quarterly, starting Sept. 30.
The preferreds can be redeemed at any time after Sept. 30, 2026 or before that time due to a ratings event or a change of control.
BofA Securities Inc., Citigroup Global Markets Inc., Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, UBS Securities LLC and Wells Fargo Securities, LLC are joint bookrunners for the offering.
Proceeds will be used to redeem all $116.3 million of the 6% senior notes due 2045, the redemption of some or all of $125 million of outstanding borrowings under a $400 million revolver and for general corporate purposes, which include the funding of capital expenditures associated with the fiber-to-the-home program in new markets.
The company plans to list the preferreds on the New York Stock Exchange under the symbol “TDSPrV.”
The telecommunications company is based in Chicago.
| Issuer: | Telephone and Data Systems, Inc.
|
| Amount: | $600 million, or 24 million shares
|
| Greenshoe: | $90 million, or 3.6 million shares
|
| Description: | Series VV cumulative redeemable perpetual preferred stock
|
| Maturity: | Perpetual
|
| Bookrunners: | BofA Securities Inc., Citigroup Global Markets Inc., Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, UBS Securities LLC and Wells Fargo Securities, LLC
|
| Co-managers: | BNY Mellon Capital Markets, LLC, CIBC World Markets Corp., TD Securities (USA) LLC, Truist Securities, Inc. and U.S. Bancorp Investments, Inc.
|
| Counsel to issuer: | Sidley Austin LLP
|
| Counsel to underwriters: | Mayer Brown LLP
|
| Dividend: | 6%
|
| Price: | Par of $25.00
|
| Yield: | 6%
|
| Call features: | At par after Sept. 30, 2026 or before that time due to a ratings event or a change of control
|
| Trade date: | Aug. 9
|
| Settlement date: | Aug. 16
|
| Ratings: | Moody’s: Ba3
|
| S&P: B
|
| Fitch: BB-
|
| Expected listing: | NYSE: TDSPrV
|
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