By Rebecca Melvin
New York, Dec. 14 - Ares Commercial Real Estate Corp. priced an upsized $60 million of three-year convertible senior notes before the market open Friday with a 7% coupon and 15% initial conversion premium, according to a news release.
The Rule 144A offering was initially talked at $50 million in size.
There is a greenshoe of $9 million, which was upsized from $7.5 million.
Credit Suisse Securities (USA) LLC was the underwriter on the offering, according to a market source. But Credit Suisse declined to respond to questions about the deal.
About $51.5 million of the issue is being sold to initial purchasers, and $8.5 million will be purchased by company directors, officers and affiliates.
The notes will be non-callable except if necessary to preserve the company's qualification as a real estate investment trust. There are no puts.
Proceeds will be used to repay debt under the company's secured funding facilities and for other general corporate purposes, which includes investing in target assets in line with Ares' investment objectives.
Ares is a Chicago-based specialty finance company that operates as a real estate investment trust.
| Issuer: | Ares Commercial Real Estate Corp.
|
| Issue: | Convertible senior notes
|
| Amount: | $60 million, upsized from $50 million
|
| Greenshoe: | $9 million, upsized from $7.5 million
|
| Maturity: | Dec. 15, 2015
|
| Bookrunner: | Credit Suisse securities (USA) LLC
|
| Coupon: | 7%
|
| Conversion premium: | 15%
|
| Conversion price: | $18.65
|
| Conversion ratio: | 53.6107
|
| Calls: | Non-callable
|
| Puts: | No puts
|
| Net share settlement: | Yes
|
| Price talk: | 7%, up 15%
|
| Pricing date: | Dec. 14, before the open
|
| Settlement date: | Dec. 19
|
| Distribution: | Rule 144A
|
| Stock symbol: | NYSE: ACRE
|
| Stock price: | $16.22 at close Dec. 13
|
| Market capitalization: | $148 million
|
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