Atlas Corp. talks $175 million five-year exchangeable notes to yield 3.25%-3.75%, up 27.5%-32.5%

By Abigail W. Adams

Portland, Me., Dec. 16 – Atlas Corp. plans to price $175 million of five-year exchangeable notes after the market close on Wednesday with price talk for a coupon of 3.25% to 3.75% and an initial exchange premium of 27.5% to 32.5%, according to a market source.

The notes will be issued by subsidiary Seaspan Corp. and exchangeable for Atlas shares.

BofA Securities Inc. and BMO Capital Markets Corp. are active bookrunners for the Rule 144A offering, which carries a greenshoe of $26.25 million.

Citigroup Global Markets Inc. and Wells Fargo Securities LLC are passive bookrunners.

The notes are non-callable for three years and then subject to a 130% hurdle.

They will be settled in cash, shares or a combination of both.

In connection with the offering, the company will enter into capped call transactions.

Proceeds will be used to cover the cost of the call spread and for general corporate purposes, which may include capital expenditures, potential acquisitions and the pre-delivery of payments for Seaspan’s newbuilding vessels.

Atlas Corp. is a Hong Kong-based global asset management company focused on infrastructure assets in the maritime and energy sectors.

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