By Rebecca Melvin
New York, March 1 - Redwood Trust Inc. priced an upsized $250 million of five-year convertible senior notes at par to yield 4.625% with an initial conversion premium of 20%, according to a term sheet.
The registered deal was initially talked at $150 million in size. The greenshoe was upsized to $37.5 million from $22.5 million.
Pricing came at the rich end of revised talk. Talk was tightened during marketing to a 4.625% to 4.875% coupon with a premium of 17.5% to 20%, from a 4.875% to 5.375% coupon with 12.5% to 17.5% premium.
J.P. Morgan Securities LLC and Barclays were the joint bookrunners.
The notes are non-callable with no puts, and there is takeover protection.
Proceeds will be used for general corporate purposes, including funding its business and investment activity, which may include purchasing residential mortgage loans, funding the origination of commercial loans and acquiring mortgage-backed securities for its investment portfolio.
Redwood Trust is a Mill Valley, Calif.-based real estate investment trust.
| Issuer: | Redwood Trust Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $250 million, upsized from $150 million
|
| Greenshoe: | $37.5 million, upsized from $22.5 million
|
| Maturity: | April 15, 2018
|
| Bookrunners: | J.P. Morgan Securities LLC, Barclays
|
| Co-managers: | Goldman Sachs & Co., JMP Securities LLC
|
| Coupon: | 4.625%
|
| Price: | Par
|
| Yield: | 4.625%
|
| Conversion premium: | 20%
|
| Conversion price: | $24.31
|
| Conversion ratio: | 41.1320
|
| Calls: | Non-callable
|
| Puts: | No puts
|
| Takeover protection: | Yes
|
| Price talk: | 4.625%-4.875%, up 17.5% to 20%, revised from 4.875%-5.375%, up 12.5%-17.5%
|
| Pricing date: | Feb. 28
|
| Settlement date: | March 6
|
| Stock symbol: | NYSE: RWT
|
| Stock price: | $20.26 at close Feb. 28
|
| Distribution: | Registered
|
| Market capitalization: | $1.66 billion
|
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