Eagle Point Credit Company to Issue Baby bonds

Specialty finance company Eagle Point Credit Company (NYSE:ECC) will be issuing a new baby bond with a maturity date in 2028.  They will issue 2,000,000 shares plus another 300,000 to be reserved for overallotments.

Pricing has not been announced as of yet, but the proceeds are going to be used to early call the ECCZ issue which matures in 2020.  This  issue became optionally callable on 12/31/2017.

Preliminary details are here.

Unfortunately we personally own a few hundred shares of the called issue meaning we will have to find a suitable replacement.

9 thoughts on “Eagle Point Credit Company to Issue Baby bonds”

  1. Tim, I know I dont need to tell you this as I am sure you have read it all, but there are so many people ignorant about preferreds. Many think the only preferreds with any value are under par. That really doesnt indicate anything. It could be a high quality issue that went to market with a low coupon and market is now pricing that in, ala, KIM-L, or it could be a potential rat like the AFSI preferreds are. And then there are rookies who still think they will automatically call them. Many got into the PSA preferreds misunderstanding why they were calling them. These last few issues that went to market are teaching them a lesson.

    1. Bob, we need an issue where Ladenburg brings it to market and Egan Jones rates the issue…..That would be an instant hall of fame issue!

      1. Do I detect just a touch of sarcasm? Grid this issue meets your Egan Jones standard–couldn’t even pull a “A”.

        The 2028 Notes are expected to be rated ‘A-’ by Egan-Jones Ratings Company. In addition, the Company plans to grant the underwriters a 30-day option to purchase up to an additional $7,500,000 aggregate principal amount of 2028 Notes to cover overallotments, if any.

        1. Tim, so since it is A- by Egan does than mean its CCC- by S&P? 🙂
          Here is a thought for you to ponder….ALLY-A ran up just too fast for me, so I dont them for more easy money again…I saw RILYL sagged late in day and I picked up 600 more shares of it at $25.28… This is the perfect type of issue that will have price stability as first call is approaching in 2 more interest payments and 2021 maturity. Market wont know what to do with this one so it should trade pretty stable. The common is doing fine and up 33% past 12 months.

          1. Correction…I “dumped them” not “dont them” (whatever that means)

          2. Grid–yes issues like that which are near or at call are many times exactly what I buy. They stay near $25 and generally don’t have the volatility of many issues–tey don’t run up because of call fears–and don’t drop down because of redemption possibilities.

            I can remember some person ignorant of how these things work was critical of my portfolios as I had bunches of issues at or near call—as long as I am within a dividend of $25 I am quite comfortable holdings those issues.

  2. Hi Leonard–I have the Z and one of the term preferreds. I am hopeful will we get an “acceptable” coupon (not great but acceptable).

  3. I’ve got ECCA and ECCB and ECCA is callable June 29, 2018. I imagine they will call it shortly thereafter too. I hope the new baby bond will be tasty enough to be a suitable replacement for these getting called.

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