By Rebecca Melvin
New York, March 1 - Health Care REIT Inc. priced $625 million of convertible perpetual preferred shares at $50.00 per share after the market close Tuesday to yield 6.5% with an initial conversion premium of 20%, according to a syndicate source.
The convertibles, which have a greenshoe of $93.75 million, priced at the tight end of talk, which was for a yield of 6.5% to 7% and an initial conversion premium of 15% to 20%.
Concurrently Health Care REIT priced $1.23 billion of common stock, or 25 million shares at $49.25 per share.
The convertible preferreds were sold via joint bookrunners UBS Investment Bank, Bank of America Merrill Lynch, Barclays Capital Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Wells Fargo Securities.
The preferreds are non-callable for seven years and then are provisionally callable if shares exceed 130% of the conversion price. There are no puts.
Proceeds from both registered, off-the-shelf offerings are earmarked to finance a portion of the purchase price of the company's previously announced acquisition of Genesis HealthCare Corp. for $2.4 billion.
If that acquisition is not completed, proceeds will be used for general corporate purposes, including investing in health care and senior housing properties and repaying borrowings under the company's unsecured line of credit and other outstanding debt.
The convertible preferreds have takeover protection.
Health Care REIT is a Toledo, Ohio-based self-administered equity real estate investment trust.
| Issuer: | Health Care REIT Inc.
|
| Issue: | Convertible perpetual preferreds
|
| Amount: | $625 million
|
| Greenshoe: | $93.75 million
|
| Concurrent offering: | $1.23 billion of common stock at $49.25 per share
|
| Maturity: | Perpetual
|
| Bookrunners: | UBS Investment Bank, Bank of America Merrill Lynch, Barclays Capital Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Wells Fargo Securities
|
| Dividend: | 6.5%
|
| Price: | Par, $50.00
|
| Yield: | 6.5%
|
| Conversion premium: | 20%
|
| Conversion price: | $59.10
|
| Call protection: | Non-callable for seven years, then provisionally callable if shares exceed 130% of conversion
|
| Puts: | No puts
|
| Price talk: | 6.5%-7%, up 15%-20%
|
| Pricing date: | March 1
|
| Settlement date: | March 7
|
| Distribution: | Registered, off the shelf
|
| Stock symbol: | NYSE: HCN
|
| Stock reference price: | $49.25
|
| Market capitalization: | $7.5 billion
|
© 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.
