Stifel offers baby bonds; Horizon not yet free but trading over par; new REIT deals mixed

By Stephanie N. Rotondo

Seattle, Sept. 27 – The new issue pipeline continued to flow into the preferred stock market on Wednesday.

Stifel Financial Corp. announced plans to sell $100 million of $25-par senior notes due 2047.

Price talk is 5.25% to 5.375%, a market source reported.

A market source said the issue was trading at $24.99 in the gray market.

The deal was expected to come after Wednesday’s close, but details were still unavailable as of 6 p.m. ET.

Keefe Bruyette & Woods Inc., BofA Merrill Lynch and Morgan Stanley & Co. LLC are running the deal.

As for deals that have priced this week, Horizon Technology Finance Corp.’s $32.5 million of 6.25% $25-par notes due 2022 – a deal priced late Tuesday – ended well above par, according to a source.

“The gray has been active around $25.25,” he said, adding that the paper had not yet freed to trade.

The notes were seen at $24.70 bid in the early gray market.

Keefe Bruyette was the bookrunner on the deal.

Also from Tuesday’s business, Investors Real Estate Trust’s $100 million of 6.625% series C cumulative redeemable preferreds finished the day at $24.75, unchanged on the day.

The deal priced in the middle of the 6.25% to 6.75% price talk.

The issue freed to trade around midday on Tuesday, getting a temporary ticker of “IRRTP.”

BMO Capital Markets and Raymond James & Associates Inc. were the bookrunners.

Spirit Realty Capital Inc.’s $150 million of 6% series A cumulative redeemable preferreds – another deal priced Tuesday – freed to trade around midday.

The issue’s temporary ticker is “SPRYP.”

The preferreds finished at par, up 5 cents.

The deal came in line with price talk. The sale marks the company’s first entry into the world of preferred stock.

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

And, Federal Realty Investment Trust’s $150 million of 5% series C cumulative redeemable preferreds were dominating overall trading, with about 1.15 million shares being exchanged.

The preferreds closed at $24.73, down 37 cents, or 1.08%.

The issue was seen at $24.72 at mid-morning, off 28 cents, or 1.12%.

That deal came Monday and freed to trade on Tuesday.

Its temporary ticker is “FDDRP.”

BofA Merrill Lynch, UBS Securities LLC and Wells Fargo led the books.

Colony lists

Among other recent deals, Colony NorthStar Inc.’s $315 million of 7.125% series J cumulative redeemable preferred stock listed on the New York Stock Exchange on Wednesday.

The ticker symbol is “CLNSPrJ.”

The issue ended at $25.04, down 6 cents.

The company initially sold $275 million of the preferreds on Sept. 13. On Sept. 18, the company said its $40 million greenshoe had been fully exercised, bringing the total amount outstanding to $315 million.

Price talk was 7.125%. The original deal was increased from an expected $100 million.

BofA Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley, UBS Securities and RBC Capital Markets LLC were the joint bookrunners.

Proceeds will be used to redeem some of the company’s 8.25% series B cumulative redeemable preferreds (NYSE: CLNSPrB) and all of its 8.875% series C cumulative redeemable preferreds (NYSE: CLNSPrC). Any remaining funds will be used for general corporate purposes.

Colony NorthStar is a real estate investment trust with offices in Los Angeles and New York.

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