Fidus prices $43.48 million baby bonds; secondary breaks losses; GE in focus

By Abigail W. Adams

Portland, Me., Jan. 31 – The primary market’s silence and the secondary market’s losing streak were broken on Wednesday.

While there has yet to be a new offering of preferred stock this week, a new baby bond deal priced after the market close on Tuesday.

Fidus Investment Corp. priced $43.48 million of $25-par five-year notes with a coupon of 5.875%.

After a three-day losing streak, the secondary market for preferreds has returned to green.

The Wells Fargo Hybrid & Preferred Securities Financial index was up 39 basis points. The U.S. iShares Preferred Stock ETF was up 0.53%.

General Electric Capital Corp.’s 4.875% notes due 2052, 4.875% notes due 2053, and 4.7% notes due 2053 were in focus during Wednesday’s session.

All three notes made significant gains in high volume trading even as an analyst predicted General Electric will be removed from the Dow Jones industrial average.

Fidus prices

Fidus brought the first new deal of the week with its pricing of $43.48 million of 5.875% notes due 2023.

Keefe, Bruyette & Woods is the sole bookrunner for the offering, which carries a greenshoe of $6.52 million.

The notes will be listed on the Nasdaq Global Select Market under the ticker “FDUSL.” They are expected to be rated A- by Egan-Jones Ratings Co.

Net proceeds are expected to be $41.8 million, or $48.1 million if the greenshoe is exercised. Proceeds will be used to repay indebtedness under the company’s credit facility.

GE in focus

GE’s 4.875% notes due 2052, 4.875% notes due 2053, and 4.7% notes due 2053 made gains in high volume trading during Wednesday’s session.

GE’s 4.875% notes due 2052 gained 181 cents, or 7.77%, to trade above par at $25.10.

The notes saw more than 9 times their average trading volume on Wednesday. The notes saw a trading volume of more than 988,000 on Wednesday.

The three-month average trading volume for the notes is about 87,000.

GE’s 4.7% notes gained 140 cents, or 6%, to close Wednesday at $24.74. The notes also saw a significant increase in their trading volume.

The notes saw a trading volume of more than 209,000 on Wednesday. The three-month average trading volume is about 88,000.

GE’s 4.875% notes due 2053 also jumped above par. The notes gained 173 cents, or 7.42% to close Wednesday at $25.05.

The notes saw a volume of more than 531,500 on Wednesday. The three-month average trading volume for the notes was 74,511.

GE has been a focus of the preferreds space for some time, as the company’s woes mount.

The gains made during Wednesday’s session came as Deutsche Bank analyst John Inch released a report predicting that GE will be dropped from the Dow, due to its tanking common stock price.

© 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.