Public Storage frees, trades actively; Eagle Point prices late; Annaly lists; Freddie dips

By Stephanie N. Rotondo

Seattle, Aug. 1 – Investors were eyeing the preferred stock primary space early Tuesday, waiting for Public Storage’s $300 million of 5.05% series G cumulative preferreds to free from the syndicate.

The market was also waiting for a new baby bond issue from Eagle Point Credit Co. Inc. to price. Late Tuesday evening, the company announced it priced an upsized $27.5 million of the 6.75% notes. The deal had been upsized from $25 million, and price talk had been at 6.875%.

For its part, the Public Storage deal freed to trade at 11:15 a.m. ET, according to a market source. At that time, it began trading under a temporary ticker, “PBSTP.”

At day’s end, the issue was at $24.75, versus $24.83 at the open.

Nearly 3.65 million shares traded during the session, making the issue the most actively traded security of the day.

Prior to freeing, traders were quoting the issue at $24.75 bid, $24.80 offered in the gray market.

The deal came Monday, upsized from $100 million. Initial price talk was 5.125% but was later revised to 5.05%.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC ran the books.

Meanwhile, price talk emerged on Eagle Point’s planned $25 million offering of $25-par unsecured notes due 2027, a deal which was announced late Monday.

A market source placed talk around 6.875%.

The deal had not priced as of 6:15 p.m. ET.

The issue will be callable after three years.

Oppenheimer & Co. Inc. and National Securities Corp. are acting as lead managers. BB&T Capital Markets and Incapital LLC are co-managers.

Among recently priced deals, Annaly Capital Management Inc.’s $700 million of 6.95% series F fixed-to-floating rate cumulative redeemable preferred stock began trading on the New York Stock Exchange on Tuesday.

The ticker symbol is “NLYPrF.”

The deal priced on July 25, coming tighter than the initial price talk of 7% to 7.125%. The issue was also upsized from $200 million.

Morgan Stanley, J.P. Morgan Securities LLC, UBS Securities, RBC Capital Markets, Citigroup Global Markets Inc. and Keefe Bruyette & Woods Inc. led the deal.

Freddie dividend in question

Freddie Mac’s 8.375% fixed-to-floating rate noncumulative preferreds (OTCBB: FMCKJ) were a touch lower as the GSE reported earnings.

The preferreds fell a nickel to $6.55. Fannie Mae’s 8.25% series S fixed-to-floating rate noncumulative preferreds (OTCBB: FNMAS) were meantime unchanged at $6.80.

For its part, Fannie will announce earnings on Thursday.

As for Freddie, the mortgage giant posted net income of $1.66 billion, which compared to $993 million the year before.

Net interest income was steady at $3.38 billion.

While Freddie said it could make a $2 billion dividend payment to the U.S. Treasury, language in the earnings release indicated that there was some question as to whether that payment would in fact be made.

The alteration in the language came just months after Federal Housing Finance Agency director Mel Watt told Congress that he was considering allowing the GSEs build up more of a capital buffer.

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