Summary
Realty Income Corporation (O) has filed an 8-K report detailing a significant equity offering and its intended use of proceeds. The company entered into a purchase agreement on October 18, 2006, to issue and sell 6,000,000 shares of common stock, with an option for underwriters to purchase an additional 900,000 shares, at a public offering price of $26.40 per share. This offering aims to raise substantial capital to fund a portion of the acquisition of the Buffets/Ryan's properties, contingent on the merger between Buffets, Inc. and Ryan's Restaurant Group closing.
Key Highlights
- 1Realty Income Corporation is conducting a public offering of 6,000,000 shares of common stock at $26.40 per share, with a potential for an additional 900,000 shares to be sold.
- 2The offering is expected to generate net proceeds of approximately $150.7 million, or $173.3 million if the overallotment option is fully exercised.
- 3Proceeds will primarily be used to finance a portion of the purchase price for the Buffets/Ryan's properties.
- 4The acquisition of these properties is subject to the successful closing of the merger between Buffets, Inc. and Ryan's Restaurant Group.
- 5The company plans to fund the acquisition using a combination of the equity offering proceeds, borrowings under a $300 million acquisition credit facility, and potentially other future debt or equity issuances.
- 6The offering is expected to increase the total outstanding shares of common stock to approximately 99.8 million shares upon closing (excluding shares from the over-allotment option).