By Kenneth Lim
Boston, June 5 - Canada's Royal Host Real Estate Investment Trust priced C$60 million of seven-year convertible subordinated unsecured debentures to yield 5.9% with an initial conversion premium of 19.3% over its common stock's Tuesday closing price.
The convertibles were offered at par.
National Bank Financial and CIBC World Markets were the lead underwriters of the Regulation S offering.
The convertibles are non-callable for the first three years. They may be called in the fourth year subject to a hurdle at 125% of the conversion price and are freely callable after the fourth year.
Royal Host, a Calgary, Alta.-based hotel real estate investment trust, said the proceeds of the deal will be used to reduce the outstanding debt on its properties, upgrade existing hotels, acquire new properties and fund general purposes.
| Issuer: | Royal Host Real Estate Investment Trust
|
| Issue: | Convertible subordinated unsecured debentures
|
| Bookrunners: | National Bank Financial and CIBC World Markets
|
| Amount: | C$60 million
|
| Maturity: | June 30, 2014
|
| Coupon: | 5.9%
|
| Price: | Par
|
| Yield: | 5.9%
|
| Conversion premium: | 19.3%
|
| Conversion price: | C$8.90
|
| Conversion ratio: | 112.3596
|
| Call protection: | Non-callable before June 30, 2010; callable from June 30, 2010 to June 29, 2011 subject to hurdle at 125% of conversion price; thereafter freely callable
|
| Pricing date: | June 5
|
| Settlement date: | June 26
|
| Distribution: | Regulation S
|
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