Summary
Realty Income Corporation (O) has filed an 8-K report detailing a significant offering of its 7.375% Monthly Income Class D Cumulative Redeemable Preferred Stock. The company entered into a purchase agreement with Credit Suisse First Boston LLC to sell 1,100,000 additional shares, bringing the total outstanding Class D preferred stock to 5,100,000 shares. This offering, priced at $25.4311 per share plus accrued dividends, is expected to generate approximately $27.6 million in net proceeds. Investors should note that these proceeds are earmarked for reducing outstanding debt under the company's $250 million credit facility and for general corporate purposes. The Class D preferred stock carries no maturity date and is redeemable at the company's discretion beginning May 27, 2009. This move indicates a strategy to strengthen the balance sheet and potentially reduce interest expenses by paying down debt.
Key Highlights
- 1Realty Income Corporation issued 1,100,000 shares of 7.375% Monthly Income Class D Cumulative Redeemable Preferred Stock.
- 2The offering is priced at $25.4311 per share plus accrued dividends.
- 3Net proceeds from the offering are estimated to be approximately $27.6 million.
- 4Proceeds will be used to repay borrowings under the company's $250 million credit facility.
- 5Remaining proceeds will be used for general corporate purposes.
- 6The Class D preferred stock has no stated maturity date.
- 7The company has the option to redeem the Class D preferred stock on or after May 27, 2009.