By Stephanie N. Rotondo
Portland, Ore., Jan. 10 - PS Business Parks Inc. sold $200 million of series S cumulative redeemable perpetual preferred shares priced at par of $25.00 with a dividend of 6.45%, according to an FWP filed with the Securities and Exchange Commission on Tuesday.
Price talk was around 6.5%, according to a market source on Monday, when the deal was first announced.
There is a $30 million over-allotment option.
The shares will be issued as depositary shares representing 1/1,000 of a share, with a liquidation preference of $25.00 per share.
Dividends will be payable quarterly beginning March 31. The company can redeem the preferred shares on or after Jan. 18, 2017 at par plus accrued and unpaid dividends.
There is no stated maturity and no sinking fund or mandatory redemption clause.
Settlement is expected Jan. 18.
Bank of America Merrill Lynch, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are the joint bookrunners.
Co-managers are Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and RBC Capital Markets LLC.
Under the underwriting, the three joint bookrunners subscribed for 2.13 million preferred shares each. The co-managers subscribed for 400,000 shares.
A third group, including D.A. Davidson & Co. LLC, Davenport & Co. LLC, Janney Montgomery Scott LLC, JJB Hilliard, WL Lyons LLC, Mesirow Financial Inc., Oppenheimer & Co. Inc., Morgan Keegan & Co. Inc., Robert W. Baird & Co. Inc., Stifel Nicolaus & Co. Inc. and Wedbush Securities Inc., subscribed for 40,000 shares each.
Proceeds will be used to redeem $84.6 million of 7.375% series O cumulative preferreds. Any remaining proceeds will be used for general corporate purposes, which may include the repayment of outstanding debt, the redemption of other preferred securities and the acquisition of commercial properties.
PS Business intends to list the preferreds on the New York Stock Exchange under the ticker symbol "PSBPS."
The real estate investment trust is based in Glendale, Calif.
| Issuer: | PS Business Parks Inc.
|
| Securities: | Series S cumulative redeemable preferred stock
|
| Amount: | $200 million, or 8 million shares
|
| Greenshoe: | $30 million, or 1.2 million shares
|
| Maturity: | Perpetual
|
| Dividend: | 6.45%
|
| Price: | Par of $25.00 per share
|
| Liquidation preference: | $25.00 per share
|
| Yield: | 6.45%
|
| Call feature: | After Jan. 18, 2017
|
| Joint bookrunners: | Bank of America Merrill Lynch, Morgan Stanley & Co. LLC, Wells Fargo Securities LLC
|
| Co-managers: | Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, RBC Capital Markets LLC
|
| Other underwriters: | D.A. Davidson & Co. LLC, Davenport & Co. LLC, Janney Montgomery Scott LLC, JJB Hilliard, WL Lyons LLC, Mesirow Financial Inc., Oppenheimer & Co. Inc., Morgan Keegan & Co. Inc., Robert W. Baird & Co. Inc., Stifel Nicolaus & Co. Inc., Wedbush Securities Inc.
|
| Pricing date: | Jan. 10
|
| Settlement date: | Jan. 18
|
| Preferred stock symbol: | NYSE: PSBPS
|
| Cusip: | 69360J719
|
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