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Melcor REIT to redeem $34.5 million 5.5% convertible debentures
By Sarah Lizee
Olympia, Wash., Oct. 10 – Melcor Real Estate Investment Trust plans to redeem its outstanding $34.5 million 5.5% convertible debentures due Dec. 31, according to a press release.
The redemption will be partially funded by the net proceeds received from $35.6 million of new mortgage financing. The balance of the redemption will be funded by cash-on-hand or a draw on the REIT’s revolving credit facility.
The proposed redemption was announced along with the company’s agreement to acquire from an arm’s length third party a commercial property for about $54.8 million.
The REIT will issue $40 million of new 5.1% convertible debentures on a bought deal basis with up to an additional $6 million greenshoe. The conversion price will be $8.90, and the maturity date will be Dec. 31, 2024.
Melcor REIT is an Edmonton, Alta.-based retail, office and industrial real estate investment trust.
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