Slate greenshoe ups 5.25% five-year convertibles to C$28.75 million

By Susanna Moon

Chicago, Jan. 26 – Slate Office REIT said underwriters fully exercised the C$3.75 million over-allotment option on its 5.25% five-year convertible unsecured subordinated debentures on Wednesday.

This brings the total deal size to C$28.75 million, according to a company news release.

As reported, Slate priced C$25 million of the five-year convertibles to yield 5.25% with an initial conversion premium of 30% in a bought deal announced after the close on Jan. 17.

The convertible debentures were priced alongside C$90 million, or 11,112,000, of subscription receipts at a price of C$8.10 per receipt.

BMO Capital Markets and National Bank Financial Inc. are lead bookrunners for the deal.

The underwriters also fully exercised the C$13.5 million greenshoe for 1,666,800 subscription receipts.

The convertibles are non-callable until Feb. 28, 2021, may be called at par from Feb. 28, 2021 to Feb. 28, 2022 subject to a 125% hurdle and are freely call after that date.

The subscription receipts and convertible debentures were priced in conjunction with Slate’s C$191.4 million acquisition of seven office properties in the greater Toronto area and Atlantic Canada.

Proceeds from the convertible debentures will be used to pay down debt under the company’s credit facility.

Slate Office is a Toronto-based real estate investment trust that currently owns 38 strategic and well-located real estate assets mostly located in Canada’s major population centers.

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