Hannon Armstrong greenshoe ups 0% convertibles to $143.75 million

By Sarah Lizee

Olympia, Wash., Aug. 21 – Underwriters for Hannon Armstrong Sustainable Infrastructure Capital Inc.’s three-year convertible notes (BB+/BB+) exercised their $18.75 million greenshoe on Friday, bringing the total deal size to $143.75 million, according to an 8-K filing with the Securities and Exchange Commission.

As previously reported, the company priced $125 million of the convertible notes after the market close on Tuesday at par with a coupon of 0% and an initial conversion premium of 27.5%, according to an FWP filing with the Securities and Exchange Commission.

Pricing came in line with talk for a coupon of 0% and at the midpoint of talk for an initial conversion premium of 25% to 30%, according to a market source.

Morgan Stanley & Co. LLC was the bookrunner for the registered offering.

The notes are non-callable. They are putable upon a fundamental change.

The convertibles are being marketed as green bonds.

The notes priced concurrently with an upsized $375 million issue of 10-year senior notes, which priced at 99 with a coupon of 3¾% to yield 3.871%.

The initial size of the 10-year senior notes was $350 million.

Net proceeds from the convertible notes are $139.9 million with the greenshoe exercised in full.

Proceeds will be used for eligible green projects.

Hannon Armstrong is an Annapolis, Md.-based energy real estate investment trust.

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