By Stephanie N. Rotondo
Phoenix, April 14 - Wells Fargo & Co. priced a $2 billion offering of 5.9% $1,000-par series S class A fixed-to-floating rate noncumulative perpetual preferred stock, according to a market source on Monday.
The preferreds will be issued as depositary shares representing a 1/25th interest, the company said in a prospectus filed with the Securities and Exchange Commission.
Wells Fargo Securities LLC is the bookrunner. Joint lead managers include ANZ Securities Inc., Banca IMI SpA, HSBC Securities (USA) Inc., nabSecurities LLC and RBS Securities Inc.
Dividends will be fixed and payable on the 15th day of June and December through June 15, 2024. After that date, the dividend will begin floating at Libor plus 311 basis points and will be payable on the 15th day of March, June, September and December.
The preferreds become redeemable June 15, 2024 at par plus accrued dividends. The San Francisco-based bank can redeem the preferreds prior to that date in whole upon the occurrence of a regulatory capital treatment event.
The call price in that instance is also par plus accrued dividends.
The new securities will not be listed.
Proceeds will be used for general corporate purposes, which may include investments in or advances to subsidiaries and/or debt repayments.
| Issuer: | Wells Fargo & Co.
|
| Securities: | Series S class A fixed-to-floating rate noncumulative preferred stock
|
| Amount: | $2 billion
|
| Maturity: | Perpetual
|
| Bookrunner: | Wells Fargo Securities LLC
|
| Lead managers: | ANZ Securities Inc., Banca IMI SpA, HSBC Securities (USA) Inc., nabSecurities LLC, RBS Securities Inc.
|
| Dividend: | 5.9% until June 15, 2024, then at Libor plus 311 bps
|
| Price: | Par of $1,000
|
| Yield: | 5.9%
|
| Talk: | 6% to 6.125%
|
| Call options: | On or after June 15, 2024 or before then upon a regulatory capital treatment event at par plus accrued dividends
|
| Pricing date: | April 14
|
| Settlement date: | April 22
|
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