By Abigail W. Adams
Portland, Me., Nov. 10 – American Hotel Income Properties REIT LP priced $50 million 6% convertible debentures due 2026 at par with an initial conversion premium of 30%, according to a company news release.
CIBC Capital Markets and BMO Capital Markets led the syndicate of underwriters for the bought deal, which carries a greenshoe of $5 million.
The notes are non-callable until Dec. 31, 2026 and are then subject to a 125% hurdle.
Upon completion of the offering, the company intends to redeem the outstanding $48,875,000 of its convertible debentures due 2022.
Proceeds will be used to fund the redemption with any remainder to be used to pay down the company’s revolving credit facility.
American Hotel Income Properties is a Vancouver, B.C.-based real estate investment trust focused on hotel properties in the United States.
| Issuer: | American Hotel Income Properties REIT LP
|
| Securities: | Convertible unsecured subordinated debentures
|
| Amount: | $50 million
|
| Greenshoe: | $5 million
|
| Maturity: | Dec. 31, 2026
|
| Bookrunners: | CIBC Capital Markets and BMO Capital Markets
|
| Coupon: | 6%
|
| Price: | Par
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| Yield: | 6%
|
| Conversion premium: | 30%
|
| Conversion rate: | 202.0203
|
| Call options: | Non-callable until Dec. 31, 2026 and are then subject to a 125% hurdle
|
| Pricing date: | Nov. 10
|
| Settlement date: | Nov. 26
|
| Distribution: | Off-shelf in Canada, private placement in United States
|
| Stock symbol: | TSX: HOT.UN
|
| Market capitalization: | C$371.86 million
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