According to the Irving-based REIT, the underwriting agreement calls for the public sale of 5.4 million depositary shares, each representing 1/10th of a share of its 8% series C preferred stock, for $25 each. The estimated $135 million of gross proceeds will be used to redeem 54,000 shares of the 9% series B and the 5.4 million of depositary shares representing the series B preferred stock. The date of the sale is not available.
FelCor plans to foot the underwriting expenses and unpaid dividend on redeemed shares from its available pool of cash. The discounts and commissions will total about $4.3 million and offering expenses, $150,000, according to a press release.
A New York City-based trio of capital players is running the show. Morgan Stanley & Co. Inc. is the lead manager and bookrunner. A.G. Edwads & Sons Inc. and Deutsche Bank Securities Inc. are co-managers.
In August 2004, FelCor raised $52 million in a one-day sale. Before 2004 ended, its aggressive fiscal plays shaved $250 million in debt from the $1.8 billion on the books at the end of December, primarily through four buybacks in 45 days that resulted in $545 million of redeemed notes and $55 million purchased on the open market. Last year was the REIT's most active financially since 2001, Andrew J. Welch, FelCor's senior vice president and treasurer for the Irving, said in a previous interview. The REIT retired $600 million of 2008 notes and $175 million that matured in early 2004.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.