Cellular telecom United States Cellular Corp (USM) will be offering a new $25/share baby bond.
The issue will likely be rated BB by Standard and Poor’s and Ba1 by Moody’s.
The company currently has 4 baby bond issues outstanding with coupons ranging from 6.25% to 7.25%. You can see the issues here. The company ‘may’ use the proceeds from the new issue for debt repayment. It would not surprise me a bit to see the company call one of the 7.25% issues.
The preliminary prospectus for the new issue can be read here.
LTVS was right on this one.
Any chance they call back UZB and UZC?
FWP : confirmed at 5.5% BA1/BB, 2070 expiration
https://sec.report/Document/0001104659-20-130518/
Hi! You had an excel sheet with pref. stocks going ex div.
But it seems to be removed, is it coming back?
it was really helpful
500 million priced 5.5%…They did that in no time flat.
IUP – What maturity???? I’m not seeing the print
2WR, The standard 3/1/2026 call ability, and 2070 maturity.
https://www.sec.gov/Archives/edgar/data/821130/000110465920130518/a20-36503_2fwp.htm
Everything is based in totality to ones income portfolio and needs of course. But there is no way in hell me personally I am rotating out of GJH into this.
I’m surprised UZA is down 2.6% on this news and not trading far from stripped par.
Oops, I thought UZA was UZD. Price action in UZA makes sense.
i don’t see uza being called when uzb and uzc are higher interest rates. Also the new offering was 500,000,000 and uzb + uzc is > 500 M.
Libero, I dont know full float size of the two above. But a greenshoe has been granted for this new issue to underwriters. So this one could easily be over a $600 million float when closed. Im sure USM has some cap ex projects needed to be done also though. Either way they aint dumb and see what they can get in market now. Its pure corporate welfare to owners to leave these 7% issues outstanding now.
UZB = 11 million shares outstanding
UZC – 12 million shares outstanding.
So with the 15% “greenshoe”, it will be 23 million shares of newly issued baby bond UZE at 5.5% – which would perfectly replace the two higher yielding 7.25% baby bonds. Would save the company $10 million in annual interest costs.
6.95% UZA should survive – for now. (Full disclosure, I own some).
Many quality issues dropped in unison today. It wasn’t just USM pfd’s. But yeah that’s par for course. Take the chips and move to a par issue w a 5.5 YTC with 5 years of call protection. VS a pfd that might be gone in the near future.
5.75 area