Summary
Realty Income Corporation (O) filed an 8-K on December 5, 2006, to report on a significant capital raise. The company entered into a purchase agreement on November 30, 2006, to issue and sell 8.8 million shares of its 6.75% Monthly Income Class E Cumulative Redeemable Preferred Stock. This offering, with a public price of $25.00 per share, is expected to close on December 7, 2006, generating net proceeds of approximately $214 million after deducting underwriting discounts and expenses. The primary intended use of these proceeds is to repay outstanding borrowings under the company's $300 million credit facility, which will strengthen its balance sheet and improve financial flexibility. The remaining funds will be allocated to general corporate purposes. The Class E preferred stock has no stated maturity and can be redeemed at the company's option beginning December 7, 2011.
Key Highlights
- 1Realty Income Corp (O) announced the issuance and sale of 8.8 million shares of 6.75% Monthly Income Class E Cumulative Redeemable Preferred Stock.
- 2The public offering price for the preferred stock is $25.00 per share.
- 3The offering is expected to generate approximately $214 million in net proceeds.
- 4Proceeds are primarily intended to repay outstanding borrowings under the company's $300 million credit facility.
- 5The Class E preferred stock has no stated maturity date.
- 6The company has the option to redeem the preferred stock on or after December 7, 2011.
- 7The purchase agreement was entered into on November 30, 2006, with closing anticipated on December 7, 2006.