Preferreds off as week begins; Qwest prices upsized $25-par notes; AmTrust lists on NYSE

By Stephanie N. Rotondo

Phoenix, Sept. 22 – The new week was off to a soft start for the preferred stock market, according to the Wells Fargo Hybrid and Preferred Securities index.

The index declined 14 basis points on the day.

Still, that wasn’t stopping the primary space from pushing out more deals.

Qwest Corp. brought $500 million of $25-par 40-year senior notes, upsized from $250 million. The new issue was priced at par to yield 6.875%, coming at the tight end of talk.

A trader saw a gray market quote of $24.75 bid, $24.85 offered for paper early in the session.

Another source said that quote was probably “consistent” with where it was by day’s end.

The notes are non-callable for five years. Proceeds will be used to retire outstanding debt.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC are the bookrunners.

On the heels of the new deal, the 6.125% $25-par notes due 2053 (NYSE: CTY) traded down 28 cents, or 1.19%, to $23.23.

Among recent deals, AmTrust Financial Services Inc.’s $80 million of 7.625% series C noncumulative perpetual preferred stock began trading on the New York Stock Exchange on Monday under the ticker symbol “AFSIPC.”

The deal priced Sept. 9.

The preferreds closed at par, up from opening levels of $24.76.

And, the Gabelli Healthcare & WellnessRx Trust’s $35 million issue of 5.875% series B cumulative perpetual preferreds were seen in a $24.80 to $24.92 context early in the day.

The preferreds finished unchanged at $24.95.

That issue came on Wednesday.

As for Morgan Stanley & Co. Inc.’s $1 billion of 6.375% series I fixed-to-floating rate noncumulative perpetual preferreds – a deal that priced Sept. 11 – it closed up a dime at $25.20.

However, a market source noted that the volume weighted average price was $25.13.

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