Morning Commentary: Arch Capital adds noncumulative deal to calendar; Cherry Hill trades up

By Stephanie N. Rotondo

Seattle, Aug. 14 – The preferred stock primary market wasn’t wasting any time as the week started.

Arch Capital Group Ltd. announced early Monday that it was selling $150 million of series F noncumulative preferreds, the proceeds of which would be used to redeem the company’s 6.75% series C noncumulative preferreds (NYSE: ARHPrC).

The series C paper was off 4 cents at mid-morning, trading at $25.36.

Price talk on the new issue is 5.5%, according to a market source.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, Wells Fargo Securities LLC and J.P. Morgan Securities LLC are running the books.

From last week’s business, Cherry Hill Mortgage Investment Corp.’s $55 million of 8.2% series A cumulative redeemable preferreds were on the active side, trading up 14 cents to $24.84.

The deal priced on Thursday. A temporary ticker of “CHMMP” was given to the issue on Friday after the deal freed from the syndicate.

The company’s inaugural issue came tighter than the 8.25% price talk.

Morgan Stanley and RBC Capital Markets LLC were the bookrunners.

Overall, the secondary was getting a boost in early dealings.

The Wells Fargo Hybrid and Preferred Securities index was up 34 basis points at mid-morning, while the U.S. iShares Preferred Stock ETF was up 57 bps.

© 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.