New York, Aug. 10 – Resource Capital Corp. priced $110 million of convertible senior notes due 2022 after the close on Thursday and issued a further $22,161,000 in exchange for the same amount of its existing convertible notes, according to a news release.
There is an over-allotment option for a further $11,589,000 of notes.
The new convertibles have a coupon of 4.5% and an initial conversion premium of 20%.
Resource Capital announced the deal at a size of $125 million with an $18.75 million greenshoe.
If the option is exercised, the size of the issue as priced will match the planned amount, including the exchange.
Credit Suisse Securities (USA) LLC is the bookrunner.
Conversions will be settled in cash, stock or both, at the company’s option.
The notes are convertible at any time prior to maturity and putable upon a fundamental change.
The bonds are non-callable for life.
Proceeds will be used to repurchase a portion of the company’s 6% convertible senior notes due 2018 and its 8% convertible senior notes due 2020 via privately negotiated transactions, open market purchases, or otherwise. However, those notes are not callable prior to maturity, so the company may not be successful in buying back the debt.
Any remaining proceeds will be used for general corporate purposes.
Resource Capital is a New York-based real estate investment trust.
| Issuer: | Resource Capital Corp.
|
| Issue: | Convertible senior notes
|
| Amount: | $110 million (plus further $11,589,000 issued in exchange_
|
| Greenshoe: | $11,589,000
|
| Maturity: | Aug. 15, 2022
|
| Coupon: | 4.5%
|
| Initial conversion premium: | 20%
|
| Conversion price: | $12.78
|
| Conversion rate: | 7.2473
|
| Net share settlement: | Yes
|
| Call: | Non-callable
|
| Bookrunner: | Credit Suisse Securities (USA) LLC
|
| Co-manager: | JMP Securities LLC
|
| Pricing date: | Aug. 10
|
| Settlement: | Aug. 16
|
| Distribution: | Off shelf
|
| Stock price: | $10.65 at close on Aug. 10
|
| Stock symbol: | NYSE: RSO
|
| Market capitalization: | $334 million
|
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