Morning Commentary: Wheeler REIT prices add-on convertible preferreds; market awaits Coupa offering

By Abigail W. Adams

Portland, Me., Jan. 11 – Wheeler Real Estate Investment Trust, Inc.’s 8.75% series D cumulative convertible preferred stock made steady gains in early trading on Thursday after the company priced a $32.58 million liquidation preference add-on.

The add-on, which forms a single unit and follows the same terms as the already issued $25-par 8.75% series D preferred stock, priced after the market close on Wednesday at $16.50 a share.

The issuer sold 1,303,000 shares for proceeds of $21.50 million.

Ladenburg Thalmann & Co. Inc. and BTIG, LLC are acting as joint bookrunners for the registered offering, which carries a greenshoe of 195,450 shares, or $3.22 million, according to the deal’s prospectus.

The preliminary prospectus placed the size of the deal at $25 million with a greenshoe of $3.75 million.

Proceeds will be used to help finance the Virginia Beach, Va.-based real estate investment trust’s acquisition of the Janaf shopping center in Norfolk, Va.

The primary market has rolled out two convertible preferred stock deals in 2018. After the market close on Thursday, a new convertible bond deal is expected to price.

Coupa Software Inc. is expected to price $200 million of five-year convertible notes with price talk for a coupon of 0.375% to 0.875% and an initial conversion premium of 25% to 30%, according to a market source.

Barclays, Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, Goldman Sachs & Co. and RBC Capital Markets are the bookrunners for the Rule 144A deal, which carries a greenshoe of $30 million.

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