By Wendy Van Sickle
Columbus, Ohio, Oct. 17 – Slate Office REIT priced C$45 million of five-year convertible unsecured subordinated debentures at par to yield 7.5% with an initial conversion premium of 25% in a bought deal announced after the close on Monday, according to a company news release.
CIBC Capital Markets, BMO Capital Markets and RBC Capital Markets are lead bookrunners for the deal.
The convertible debentures have a greenshoe of C$6.75 million.
The convertibles are non-callable until Dec. 31, 2025, may be called at par from Dec. 31, 2025 to Dec. 31, 2026 subject to a 125% hurdle and are freely call after that date, according to a company news release.
The convertible debentures were priced in conjunction with Slate’s C$19.8 million acquisition of a class A office property in Chicago.
Proceeds from the convertible debentures will be used to partially fund the acquisition, to reduce the REIT’s secured debt and for other general corporate purposes.
Slate Office is a Toronto-based real estate investment trust that owns strategic real estate assets mostly located in Canada’s major population centers.
| Issuer: | Slate Office REIT
|
| Amount: | C$45 million
|
| Greenshoe: | C$6.75 million
|
| Issue: | Convertible unsecured subordinated debentures
|
| Maturity: | Dec. 31, 2027
|
| Bookrunners: | CIBC Capital Markets, BMO Capital Markets and RBC Capital Markets
|
| Coupon: | 7.5%
|
| Price: | Par
|
| Yield: | 7.5%
|
| Conversion premium: | 25%
|
| Conversion price: | C$5.50
|
| Conversion rate: | 181.8182
|
| Call: | From Dec. 31, 2025 at par subject to a 125% hurdle, freely callable from Dec. 31, 2026 at par
|
| Pricing date: | Oct. 17
|
| Settlement date: | Oct. 24
|
| Distribution: | Off shelf in Canada
|
| Stock symbol: | TSX: SOT.UN
|
| Stock price: | C$4.41 at close on Oct. 17
|
| Market capitalization: | C$353.57 million
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