Armour preps new issue; Cedar Realty prices add-on to 7.25% preferreds; Duke up on call

By Stephanie N. Rotondo

Phoenix, Feb. 7 - It was a mixed bag for the preferred stock market on Thursday.

But new issues were trickling out, as Armour Residential REIT Inc. announced plans to sell series B cumulative redeemable preferreds.

Price talk is around 8%, according to a trader, who added that there was no selling group on the deal.

As of press time, the deal had yet to price.

Cedar Realty Trust Inc. also announced a deal, an add-on to its 7.25% series B cumulative redeemable preferreds. The addition priced at the close, with $50 million preferreds being sold at a premium.

In the secondary, Duke Energy Corp.'s Progress Energy Carolinas Inc.-linked preferreds were trading up after the company said late Wednesday it was redeeming all three series of the outstanding shares - along with five series linked to Progress Energy Florida Inc. - on March 8.

Armour talks new deal

Armour Residential REIT said it was planning an offering of series B cumulative redeemable preferreds on Thursday.

With price talk around 8%, a trader remarked that the proposed issue was similar to the 8.25% series A cumulative redeemable preferreds issued back in June.

He saw the issue quoted at $24.58 bid, $24.62 offered in the gray market.

"It's going to be a small deal," he said.

Pricing details had not been released as of press time.

Proceeds from the new issue will be used to acquire new agency securities and for general corporate purposes.

Armour is a Vero Beach, Fla.-based investor in residential mortgage backed securities.

Cedar Realty brings add-on

Cedar Realty Trust priced a $50 million add-on to its 7.25% series B cumulative redeemable preferreds during Thursday trading.

The add-on came at the price of $24.5813, which was a premium over the securities' (NYSE: CDRPB) closing price of $24.52, which was up 31 cents from the previous day.

The Port Washington, N.Y.-based real estate investment trust will use the proceeds to redeem its 8.875% series A cumulative redeemable preferreds (NYSE: CDRPA), which fell 3 cents in trading to end at $25.28.

Any remaining funds will be used for working capital.

Duke to redeem Progress shares

Duke Energy's Progress Energy Carolinas paper was on the rise after the company announced a redemption of eight series of preferreds, including the Carolinas' issues.

The $4.20 series preferreds (OTOTC: CPWPN) were up $9.61, or 10.39%, at $102.11. The $5 preferreds (OTOTC: CPWPO) gained $9.26, or 9.15%, to $110.41.

The former issue will be redeemed at $102 plus accrued dividends, while the latter will be called at $110 plus accrued dividends.

Duke Energy is a Charlotte, N.C.-based energy producer.

Strength in recent issues

General Growth Properties Inc.'s new $250 million of 6.375% series A cumulative redeemable preferreds - a deal that came Wednesday - was "hanging around" $24.83 bid, $24.87 offered.

"It might free by the end of today," a trader said.

Selective Insurance Group Inc.'s recent $175 million issue of 5.875% $25-par senior notes due 2043, however, did free from the syndicate on Thursday. That paper was pegged at $24.75 at midday.

By the end of the day, the issue was being quoted at $24.85 bid, $24.90 offered.

In other recent issues, Zions Bancorporation's $171.8 million of 6.3% series G fixed-to-floating rate noncumulative perpetual preferreds was continuing to do well, trading around $25.50 as of midafternoon.

The issue priced at auction on Jan. 31.

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