By Stephanie N. Rotondo
Portland, Ore., Jan. 5 - Public Storage priced a $400 million offering of 5.9% series S cumulative perpetual preferred shares on Thursday, according to market sources.
The previous expectations for the issue size were $50 million.
There is a $60 million over-allotment option.
Price talk had originally been around 5.95% but was revised Wednesday to 5.9%.
Bank of America Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC are the joint book-running managers. The bookrunners each subscribed for 3.67 million of the preferreds.
Other underwriters included Janney Montgomery Scott LLC, Morgan Keegan & Co. Inc., Oppenheimer & Co. Inc., Raymond James & Associates Inc. and RBC Capital Markets LLC for 120,000 preferreds each. B.C. Ziegler and Co., C.L. King & Associates Inc., City Securities Corp., D.A. Davidson & Co., Davenport & Co. LLC, HRC Investment Services Inc., J.J.B. Hilliard, W.L. Lyons LLC, Keefe, Bruyette & Woods Inc., KeyBanc Capital Markets Inc., Lebenthal & Co. LLC, Mesirow Financial Inc., Pershing LLC, Robert W. Baird & Co. Inc., Wedbush Securities Inc. and William Blair & Co. LLC each subscribed for 40,000 preferreds.
The preferreds were sold as 16 million depositary shares each representing a 1/1,000th interest in a cumulative preferred share of beneficial interest, series S. The liquidation preference is $25 per depositary share, according to a prospectus filed with the Securities and Exchange Commission.
Cumulative dividends will be payable quarterly beginning March 31. The preferreds can be redeemed beginning Jan. 12, 2017 at par plus accrued dividends.
There is no stated maturity, sinking fund or mandatory redemption.
The company plans to list the preferreds on the New York Stock Exchange.
Settlement is expected Jan. 12.
Proceeds will be used to make investments in self-storage facilities and in entities that own self-storage facilities, to redeem preferred securities and for other general corporate purposes.
On Thursday, the company announced that it plans to redeem $206.67 million of its 6.75% series L cumulative preferreds (NYSE: PSAPL).
Public Storage is a Glendale, Calif.-based real estate investment trust.
| Issuer: | Public Storage
|
| Securities: | Series S cumulative preferred stock
|
| Amount: | $400 million, or 16 million depositary shares
|
| Greenshoe: | $60 million, or 2.4 million depositary shares
|
| Dividend: | 5.9%, payable quarterly
|
| Price: | $25 per depositary share
|
| Call option: | Beginning Jan. 12, 2017
|
| Bookrunners: | Bank of America Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC
|
| Underwriters: | Bank of America Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC, Wells Fargo Securities LLC, Janney Montgomery Scott LLC, Morgan Keegan & Co. Inc., Oppenheimer & Co. Inc., Raymond James & Associates Inc., RBC Capital Markets LLC, B.C. Ziegler and Co., C.L. King & Associates Inc., City Securities Corp., D.A. Davidson & Co., Davenport & Co. LLC, HRC Investment Services Inc., J.J.B. Hilliard, W.L. Lyons LLC, Keefe, Bruyette & Woods Inc., KeyBanc Capital Markets Inc., Lebenthal & Co. LLC, Mesirow Financial Inc., Pershing LLC, Robert W. Baird & Co. Inc., Wedbush Securities Inc. and William Blair & Co. LLC
|
| Pricing date: | Jan. 5
|
| Settlement date: | Jan. 12
|
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