Correction: The original version of this article, which appeared in the Oct. 15 edition of the Prospect News Convertibles Daily, incorrectly identified the co-managers. They are Capital One Southcoast Inc. and Howard Weil Inc. A corrected version of the story follows:
By Rebecca Melvin
New York, Oct. 12 - Penn Virginia Corp. priced an upsized $100 million of convertible preferred shares at $100 per share after the market close Thursday to yield 6% and with an initial conversion premium of 20%, according to a term sheet.
The registered offering, which was originally going to be $50 million in size, priced at the cheap end of 5.5% to 6% yield talk and 20% to 25% premium talk.
The depositary shares represent a fractional ownership of interest in a share of convertible perpetual preferred stock, or preferred equity. There is an over-allotment option for up to $15 million additional preferreds, up from an originally talked $7.5 million.
Penn Virginia also priced a downsized secondary offering of 8 million of common stock, at $5.00 per share, or $40 million.
The stock offering was initially going to be 12 million in size. There is an over-allotment option for 1.2 million additional shares, which was downsized from 1.8 million.
Credit Suisse Securities (USA) LLC was the active bookrunner and stabilization agent for the preferred offering, with RBC Capital Markets and Wells Fargo Securities as passive bookrunners.
Co-managers were Capital One Southcoast Inc. and Howard Weil Inc.
Proceeds of both offerings will be used to repay outstanding borrowings under the company's revolving credit facility and for general corporate purposes.
The perpetual preferreds are non-callable, with forced conversion on Oct. 15, 2017 at the company's option if the stock is 130% above the conversion price.
The shares have physical conversion settlement and change-of-control and dividend protection.
Penn Virginia is a Radnor, Pa.-based oil and gas driller operating onshore in the continental United States.
| Issuer: | Penn Virginia Corp.
|
| Issue: | Convertible preferred shares
|
| Amount: | $100 million, upsized from $50 million
|
| Greenshoe: | $15 million, upsized from $7.5 million
|
| Maturity: | Perpetual
|
| Concurrent offering: | $40 million of common stock, or 8 million shares, downsized from 12 million
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, RBC Capital Markets, Wells Fargo Securities LLC
|
| Co-managers: | Capital One Southcoast Inc. and Howard Weil Inc.
|
| Dividend: | 6%
|
| Price: | Par of $100
|
| Yield: | 6%
|
| Conversion premium: | 20%
|
| Conversion price: | $6.00
|
| Conversion ratio: | 16.6667 common shares
|
| Call: | Non-callable until Oct. 15, 2017, then provisionally callable subject to 130% price hurdle
|
| Dividend protection: | Yes
|
| Takeover protection: | Yes
|
| Pricing date: | Oct. 11
|
| Settlement date: | Oct. 17
|
| Price talk: | 5.5%-6%, up 20%-25%
|
| Stock symbol: | NYSE: PVA
|
| Stock reference price: | $5.00, at close Oct. 11
|
| Distribution: | Registered
|
| Market capitalization: | $224.7 million
|
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