Atlas Resource comes upsized, in line with talk; Dominion above par; Morgan Stanley sinks

By Stephanie N. Rotondo

Phoenix, Sept. 25 – The preferred stock market was again soft in Thursday trading.

The Wells Fargo Hybrid and Preferred Securities index finished off 14 basis points, after being down 7 bps at mid-morning.

A trader said that the market was on the quiet side, speculating that Rosh Hashana – the Jewish New Year – was taking people away from their desks; thus, little was getting done.

Atlas Resource Partners LP priced $80 million of 8.625% class D cumulative redeemable perpetual preferred units around midday.

The deal was upsized from $50 million and came in line with price talk.

However, market sources saw no markets for the new securities.

Morgan Stanley & Co. LLC and UBS Securities LLC are leading the non-rated deal.

But Dominion Resources Inc.’s $685 million of 5.75% $1,000-par series A enhanced junior subordinated notes due Oct. 1, 2054 were seen trading at 100.5 bid.

That issue priced Wednesday.

The company officially called its 8.375% 2009 series A enhanced junior subordinated notes due 2064 (NYSE: DRU) late Wednesday. Proceeds from the new issue will be used to redeem the debt.

The notes were trading at $25.20 at Thursday’s close, unchanged from Wednesday’s close.

Also from this week’s business, Qwest Corp.’s $500 million issue of 6.875% $25-par senior notes due 2054 continued to languish in a $24.50 to $24.60 context.

Those notes came Monday.

Morgan Stanley declines

Morgan Stanley & Co. Inc.’s preferreds were actively traded on Thursday but down on the day.

A market source said there was “nothing in particular” moving the preferreds, adding that it was “probably somebody just moving stuff around.”

But the New York-based investment bank was in the headlines on Thursday after Reuters reported that Russian crude oil producer Rosneft was thinking of nixing its plan to buy Morgan Stanley’s oil trading unit.

The decision was said to be based on recent international sanctions imposed on Russia.

The 7.125% fixed-to-floating rate series E noncumulative preferreds (MSPE) were the busiest of the preferreds, trading down 12 cents to $27.45. The 6.375% fixed-to-floating rate series I noncumulative preferreds (NYSE: MSPI) dipped 3 cents to $25.07, and the 6.625% series G noncumulative preferreds (NYSE: MSPG) declined a nickel to $25.24.

The company’s common shares (NYSE: MS) were down 76 cents, or 2.17%, to $34.22.

Gabelli set to list

The Gabelli Healthcare & WellnessRx Trust’s $35 million of 5.875% series B cumulative perpetual preferred shares will begin trading on the New York Stock Exchange on Friday, according to a market source.

The deal priced Sept. 17. The ticker symbol is “GRXPB.”

The paper was trading up 8 cents on Thursday – bucking the day’s trend – to close at $24.90.

BofA Merrill Lynch was the bookrunner.

Proceeds will be used for investments.

Gabelli Healthcare is a Rye, N.Y.-based diversified, closed-end management investment company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.