Summary
Public Storage (PSA) filed an 8-K on November 6, 2019, to report the entry into a material definitive agreement related to the issuance of new preferred equity. Specifically, the company entered into an Underwriting Agreement to sell 9,000,000 depositary shares, each representing 1/1,000 of a 4.700% Cumulative Preferred Share of Beneficial Interest, Series J. This issuance represents a capital-raising activity designed to strengthen the company's financial position or fund growth initiatives. The offering includes an option for underwriters to purchase an additional 1,350,000 depositary shares for over-allotments, indicating potential demand for the security.
Key Highlights
- 1Public Storage entered into an Underwriting Agreement to issue 9,000,000 depositary shares representing a new series of preferred stock (Series J).
- 2The new preferred shares carry a fixed dividend rate of 4.700% and are cumulative.
- 3The company granted underwriters an option to purchase up to 1,350,000 additional depositary shares to cover potential over-allotments.
- 4The issuance of these preferred shares may impose restrictions on the company's ability to make distributions or redeem other junior or parity securities if preferred dividends are not paid.
- 5The Board of Trustees has the authority to issue up to 100,000,000 preferred shares, with 10,350 designated for Series J.
- 6Key financial institutions, including affiliates of BofA Securities, Morgan Stanley, UBS, and Wells Fargo, are acting as underwriters and are also lenders or agents under PSA's existing credit facilities, highlighting established banking relationships.