Capital One sells preferreds; Scorpio Tankers plans baby bonds; Del Monte offering eyed

By Christine Van Dusen and Stephanie N. Rotondo

Atlanta, Oct. 28 – Capital One Financial Corp. sold new preferred stock on a Tuesday that saw other signs of life in the primary market.

In its new issue, Virginia-based Capital One sold $500 million of series D fixed-rate noncumulative perpetual preferred stock at 6.7%, a market source said.

Price talk was set in the 6.875% area, according to a trader.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC, Wells Fargo Securities LLC and J.P. Morgan Securities LLC were the joint bookrunning managers for the Securities and Exchange Commission-registered deal.

Dividends will be payable on the first day of March, June, September and December, beginning March 1. The company can redeem the preferreds on or after Dec. 1, 2019 or within 90 days of a regulatory capital treatment event at par plus accrued dividends.

The company intends to list the new securities on the New York Stock Exchange under the ticker symbol “COFPD.”

Proceeds will be used for general corporate purposes.

Meanwhile, Scorpio Tankers Inc. is planning an unusual offering of $25 million $25-par senior unsecured notes due 2017.

Price talk for the baby bonds – which market sources say typically carry longer maturities – is about 7.5%. Stifel, Nicolaus & Co. Inc., Jefferies Inc., Credit Suisse Securities (USA) LLC and Janney Montgomery Scott LLC are running the books.

Pricing is expected Wednesday.

A trader said there was “no selling group” and added that he had not seen any gray markets for paper.

Looking ahead, Del Monte Pacific Ltd. is said to be planning a $360 million sale of $10.00 preferreds, the proceeds of which will be used for debt refinancing.

Price talk on that deal –slated for early December – is 5.25% to 7%.

In trading on Tuesday, RBS Capital Funding Trust V’s 5.9% noncumulative guaranteed trust preferred securities were up 9 cents to $23.96 on 864,109 shares traded.

Goldman Sachs Group Inc.’s floating-rate non-cumulative preferred stock moved down 6 cents to $19.895 on 143,220 shares traded.

And Deutsche Bank Contingent Capital Trust V’s 8.05% trust preferred securities ticked up 4 cents to $28.38 on 136,822 shares traded.

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