CLO (collateralized loan obligations) company Eagle Point Credit (ECC) is offering a new term preferred stock.
The preliminary prospectus can be found here.
ECC has numerous baby bond issues outstanding as well as 1 term preferred which can be seen here.
Irish was on top of this one.
16 thoughts on “Eagle Point Credit Company to Sell New Term Preferred”
I believe ECCW was issued with the intent of calling ECCB . I had X and Y but sold out into W for it’s longer call protection, I have some ECCB and will hold
No signs of that, Eddie, in ECCW Use of Proceeds section… ECCB not callable until 10/31 would also make it unlikely they intended proceeds from a March issue to be set aside for an October call.. too expensive to have both outstanding – that is unless your RILY who does it all the time… still enjoying interest payments on RILYG 3 months after they issued RILYK with use of proceeds intended to call G “as soon as practicable.”
So that said, potential pressure on either Y (6.75%) or X (6.6875%)?
If there’s pressure on either, I’d think it be more on a comparative price basis vs new issue pricing rather than likelihood of call….. If 6.50% is the price indication on the new issue, there’s no savings to be had on calling Y or X after taking into account cost of issuance.. – plus usually the issuer takes a hit on the books when calling an issue due to amortized issuance costs. Also there’s no sign of ECC indicating using funds to call anything from the proceeds.
Thanks 2WR. I guess we (I) am all a little call “shell shocked” – whenever we see a new issue coming out we assume it will be to refinance.
I did neglact to take into account that this is a preferred vs Y and X being notes…. That makes the price comparison of this new issue at 6.50% vs where the notes are trading more understandable…
I hope this pays monthly. If yes, I am in large as i love ECCB.
as a trader I don’t like monthly payers they have less volatility. For a hold it’s only better because people like steady payments. If you own multiple stocks your dividends are probably spread out anyway, not worth paying extra for monthly.
Any guesses on a call and which issue? X/Y or wait a few months for B?
ECCW is only $25 million. ECCB is $450 million. Unlikely to see a call, or it will be a very small partial call. ECCW is also $25 million, coupon is a little higher, but not callable until 2024. ECCX and ECCY are both small and optionally callable with a slightly higher interest rate, so that is where the call risk might be. ECCY is the highest interest rate. However, due to the RIC leverage rules, replacing debt with preferred hampers ECC’s ability to lever up.
Egan Jones: BBB
Is there temporary symbol on ECCC? (Holding X now because of call safety vs Y and Z) ~
Very small issue even by ECC standards.