RAIT Financial to price $100 million 20-year convertibles to yield 5.75%-6.25%, up 17.5%-22.5%

By Rebecca Melvin

New York, March 14 - RAIT Financial Trust plans to price $100 million of 20-year convertible senior notes after the market close Monday that were talked to yield 5.75% to 6.25% with an initial conversion premium of 17.5% to 22.5%, according to a market source.

There is a $15 million greenshoe for the registered offering, which is being sold via bookrunner Bank of America Merrill Lynch.

The notes are non-callable for five years, with puts in years five, 10 and 15. There is contingent conversion if shares rise to 130% of the conversion price.

There is full dividend protection via a conversion rate adjustment and change-of-control protection.

RAIT intends to use the proceeds to repay debt and for general trust purposes, including working capital.

Philadelphia-based RAIT is a real estate investment trust focused on properties in Philadelphia and in the Baltimore to Washington, D.C., corridor.

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