By Rebecca Melvin
New York, July 21 - H&R Real Estate Investment Trust priced C$75 million of 5.5-year convertible debentures on a bought-deal basis to yield 6.75%, with an initial conversion premium of 17%, according to a release.
The deal was sold via a syndicate co-led by CIBC, RBC Capital Markets and TD Securities Inc.
There is a greenshoe for an additional C$25 million of debentures.
Proceeds will be used to fund The Bow development in Calgary, Alta., and in the interim for general trust purposes.
The debentures will be convertible at the holder's option into stapled units of H&R at any time at a conversion price of C$14 per stapled unit.
The convertibles are non-callable for three years, until July 30, 2012, and then provisionally callable until July 30, 2013 subject to a hurdle of 125% of the volume weighted average trading price for the stapled units.
From July 30, 2013 until maturity, they may be redeemed at par plus accrued interest.
The offering is being made under an existing shelf prospectus.
Closing is expected, subject to regulatory approval, on July 30.
Toronto-based H&R REIT owns a portfolio of office, industrial and retail properties in North America, with a net book value of $4.5 billion.
| Issuer: | H&R Real Estate Investment Trust
|
| Issue: | Convertible debentures
|
| Amount: | C$75 billion
|
| Greenshoe: | C$25 million
|
| Maturity: | Dec. 31, 2014 |
|
| Bookrunners: | CIBC, RBC Capital Markets and TD Securities
|
| Coupon: | 6.75%
|
| Price: | Par
|
| Yield: | 6.75%
|
| Conversion premium: | 17%
|
| Conversion price: | C$14.00 per stapled unit
|
| Calls: | Non-callable for three years until July 20, 2012, provisionally callable at a 125% price hurdle from July 30, 2012 to July 30, 2013, then freely callable at par
|
| Pricing date: | July 21
|
| Closing: | July 30
|
| Stock symbol: | TSX: HR.UN
|
| Stock reference: | C$11.75
|
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