Preferred calendar getting busier; PPL, Astoria announce new issues; Interstate active

By Stephanie N. Rotondo

Phoenix, March 12 - New issues were heating up on Tuesday, and the trend was expected to continue.

"We're sure there's going to be more deals all week," said one preferred stock trader.

PPL Capital Funding Inc. announced a sale of $25-par 2013 series B junior subordinated notes due April 30, 2073 early in the session. Price talk was 6% to 6.125% but was then revised to around 5.9%.

"It's all done," a trader said of the deal, adding that it did not sound like the size was going to be upped. However, his speculation proved incorrect when the deal was upped to $400 million from $200 million.

Astoria Financial Corp. also announced a new deal, an offering of at least $125 million series C noncumulative perpetual preferreds. Price talk on that was 6.5%. After the close, a market source said the issue had been "formally launched" at $135 million.

Official pricing details were not released as of press time, however.

A source said the market overall was "flat-ish" on the day, adding that volume was "OK in a limited number of names." He said that several issues saw trading of 1 million-plus shares, but that then liquidity dropped off severely.

PPL prices $25-par notes

PPL Capital brought $400 million of 5.9% $25-par junior subordinated notes due 2073 on Tuesday.

Price talk was originally in a 6% to 6.125% context but was later revised to 5.9%. A trader had opined that the deal would not increase, but it did in fact upsize from $200 million.

A trader noted that the new issue was "doing pretty well," quoting the notes at $24.85 bid, $24.90 offered in the midday gray market.

"It was doing well, but then it softened," another source said. However, the paper must have rallied, as he quoted the issue at $24.92 bid, $24.97 offered.

The notes will be guaranteed by PPL Corp., an Allentown, Pa.-based energy provider.

Astoria plans new issuance

Astoria Financial also announced a new deal on Tuesday, an offering of series C noncumulative perpetual preferreds.

The deal was reportedly upped to $135 million from $125 million. Price talk was around 6.5%.

At midday, a trader said he had not seen any markets in it. But after the close, a source said the issue was around $24.80 bid, $24.85 offered.

Astoria Financial is a Lake Success, N.Y.-based banking institution.

Recent deal goings-on

From Monday's deals, Pebblebrook Hotel Trust's new $90 million issue of 6.5% series C cumulative redeemable preferreds were seen at $24.85 bid at midday.

However, a trader said he hadn't seen any quotes for Taubman Centers Inc.'s $150 million of 6.25% series K cumulative redeemable preferreds.

Interstate Power tops trading

Interstate Power & Light Co.'s 8.375% series B cumulative preferreds (NYSE: ILPPB) were dominating trading on Tuesday, with over 2 million shares changing hands.

The Cedar Rapids, Iowa-based power company called the issue on Feb. 4 for March 22.

The preferreds closed the day unchanged at $25.02.

The redemption price is $25.0407. A separate dividend payment will be made on March 15.

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