By Kenneth Lim
Boston, Jan. 11 - Alexandria Real Estate Equities Inc. on Wednesday priced an upsized $400 million of 20-year convertible senior unsecured notes within talk, at a coupon of 3.7% and an initial conversion premium of 20%, but reoffered at 99.5.
The notes were talked at a coupon of 3.5% to 3.75% and an initial conversion premium of 20%, and originally offered at par.
The size of the deal was initially $350 million, with an over-allotment option for a further $52.5 million. The greenshoe was increased to $60 million.
UBS Investment Bank, Citigroup and Merrill Lynch were the bookrunners of the Rule 144A deal.
The notes are non-callable for the first five years. They may be put in years five, 10 and 15.
There is a contingent conversion hurdle at 120% of the conversion price.
The convertibles have standard dividend protection for quarterly cash dividends above 74 cents per common share. There is takeover protection in the form of a change-of-control put and a make-whole premium.
There is a net-share settlement feature.
Alexandria is a Pasadena, Calif.-based real estate investment trust that focuses on offices and laboratories that are leased to research entities and government agencies. It will use the proceeds of the offering to reduce the outstanding balance on an unsecured credit line, which will free up the credit line for working capital and other corporate purposes that includes acquisitions and property development.
| Issuer: | Alexandria Real Estate Equities Inc.
|
| Issue: | Convertible senior unsecured notes
|
| Bookrunners: | UBS Investment Bank, Citigroup and Merrill Lynch
|
| Amount: | $400 million
|
| Greenshoe: | $60 million
|
| Maturity: | Jan. 15, 2027
|
| Coupon: | 3.7%
|
| Price: | Par, reoffered at 99.5
|
| Yield: | 3.7%
|
| Conversion premium: | 20%
|
| Conversion price: | $117.96
|
| Conversion ratio: | 8.4774
|
| Contingent conversion: | 120%
|
| Net-share settlement option: | Yes
|
| Dividend protection: | Ratio adjustment if common quarterly dividend exceeds 74 cents per share
|
| Takeover protection: | Change-of-control put with make-whole premium
|
| Call protection: | Non-callable before Jan. 15, 2012
|
| Puts: | Jan. 15, 2012; Jan. 15, 2017; Jan. 15, 2022
|
| Price talk: | 3.5%-3.75%, up 20%
|
| Pricing date: | Jan. 10, after the close
|
| Settlement date: | Jan. 17
|
| Distribution: | Rule 144A
|
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