OFS Credit Finally Prices Term Preferred Issue–UPDATED

It has been announced that the issue will trade with the symbol of OCCIP on the OTC Grey market. This is the same symbol that the permanent ticker is supposed to be. Never had that before but it is what FINRA has announced.

The new pricing term sheet has also been posted–here.

CLO (collateralized loan obligation) owner OFS Credit (NASDAQ:OCCI) has priced their new issue of term preferred stock.

The company will sell 800,000 shares with a coupon of 6.875%. There are also 120,000 shares available for over allotments. The shares will have a mandatory redemption date on 3/31/2024. Early optional redemption will be available to the company starting 3/31/2021.

The company will pay monthly dividends on the shares.

The shares will trade on the NASDAQ under ticker OCCIP. A OTC Grey market ticker has not yet been announced–although we would expect one to be announced today.

The company press release for the pricing of this issue can be seen here.

The preliminary prospectus can be seen here.

Of course this is an unrated issue.

OFS Credit is organized as a closed end fund and thus must follow asset coverage ratios on senior securities of 200% or more.

5 thoughts on “OFS Credit Finally Prices Term Preferred Issue–UPDATED”

  1. This coupon seems a bit low. For a new fund in the CLO field, they are paying just a little more than OXLC recent term preferred and way less the ECC’s and OXLC’s older term preferred. ECC and OXLC are the more established players in this space. If I was ECC or OXLC, I would be looking to refinance the ECCA and OXLCO (both 7.5% coupon and currently redeemable). Of course, OCCI is just starting up, so they don’t have the leverage of the others yet, but as new entrants in the space, seems like a pretty low coupon. Too bad, I was hoping we would get a higher coupon on these due to them being newbies.

    1. After a year of rising interest rates you would think new issues would have higher coupons than their predecessors, not lower. 2019 has been generally disappointing in that regard.

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