Morning Commentary: State Street prices, frees to trade; Sotherly sells $25-par notes; CoBank eyed

By Stephanie N. Rotondo

Phoenix, Nov. 19 – Preferred stocks began trading with a firm tone on Wednesday, helping to lessen the late-day losses from the previous session.

The Wells Fargo Hybrid and Preferred Securities index was up 8 basis points. It closed down 16 bps on Tuesday.

State Street Corp. released details on its offering of series E noncumulative perpetual preferreds early Wednesday. The company sold $750 million of the preferreds at par to yield 6%.

Initial price talk was 6.125% to 6.25%.

A trader said the issue had freed to trade, quoting it at $24.90 bid, $24.95 offered.

Morgan Stanley & Co. LLC, BofA Merrill Lynch, UBS Securities LLC and Wells Fargo Securities LLC were the joint bookrunning managers.

Sotherly Hotels LP also put out details on its sale of $25-par senior notes due 2019.

The offering was first announced Nov. 12 and priced late Tuesday.

The notes came at 7%, and $25.3 million were sold.

A trader said he saw the paper offered at $24.60.

Sandler O’Neill + Partners LP was the bookrunner. Boenning & Scattergood Inc., J.J.B. Hilliard, W.L. Lyons, LLC, Incapital LLC and Ladenburg Thalmann were the co-managers.

In newly announced deals, CoBank ACB is shopping around a $250 million issue of perpetual preferreds.

Price talk is around 6.5%, according to a market source.

BofA Merrill Lynch, J.P. Morgan Securities LLC and Morgan Stanley are running the deal.

The paper is non-callable for 10 years.

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