Morning Commentary: American Homes on tap; RBS calls trust issues; Breitburn enters bankruptcy

By Stephanie N. Rotondo

Seattle, May 16 – The primary preferred stock market was starting the week off with a couple of deals on Monday.

A trader noted that the buzz was that at least three to four deals could come over the course of the week.

But first up was American Homes 4 Rent, which was planning a sale of series D cumulative redeemable perpetual preferreds.

Price talk was in a 6.625% area, according to a market source.

A trader saw the issue quoted at $24.75 bid, $24.85 offered in the early gray market.

Raymond James, FBR Capital Markets, Keefe Bruyette & Woods Inc. and Wells Fargo Securities LLC are the joint bookrunners. BB&T Capital Markets, Janney Montgomery Scott LLC, Oppenheimer & Co. and Wunderlich Securities Inc. are the co-managers.

Meanwhile, Gladstone Commercial Corp. was also said to be doing an offering of series D cumulative redeemable preferreds, the proceeds of which will be used to fund a redemption of the company’s outstanding preferreds.

Price talk was in a 6.75% to 7% range, the company said in a regulatory filing.

As for the issues to be called – assuming the company can complete the series D sale – the 7.125% series C cumulative term preferreds (Nasdaq: GOODN) were trading off 12 cents at $25.23. The 7.75% series A cumulative redeemable preferreds (Nasdaq: GOODP) were down 49 cents, or 1.89%, at $25.41.

Away from the primary market, Royal Bank of Scotland Group plc announced that it was redeeming three outstanding trust issues, “which is kind of a big thing,” a trader said.

The Edinburgh, Scotland-based bank plans to call all $1.285 billion of its 5.9% noncumulative guaranteed trust preferred securities (NYSE: RBSPE), all $200 million of its 6.25% noncumulative guaranteed trust preferred securities (NYSE: RBSPI) and all $1.8 billion of the 6.08% noncumulative guaranteed trust preferred securities.

The redemption will take place on June 13 at a redemption price of par plus accrued dividends.

On the news, the 5.9% preferreds were up 82 cents, or 3.34%, at $25.2672.

Also notable for the day, Breitburn Energy Partners LP announced that it had filed for bankruptcy protections.

In response, the 8.25% series A cumulative redeemable perpetual preferred units (Nasdaq: BBEPP) were down 65.5 cents, or 69.68%, at 28.5 cents.

© 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.