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Tickers in this Article: MS, C, BAC, O
Realty Income Corp. (O), the monthly dividend company, announced that it has priced a public offering of unsecured senior notes worth $750 million at 99.775%, with a yield to maturity of 4.678%. The notes are scheduled to mature in 2023. Moreover, the unsecured notes bear an interest rate of 4.65%.

Realty Income intends to utilize the net proceeds for the repayment of outstanding borrowings related to the company’s acquisition credit facility. The company would also utilize the net proceeds for other general business purposes and working capital needs that might include acquisitions.

The lead manager for the offering is Morgan Stanley (MS). Further, several banking giants such as - Citigroup, Inc. (C), BofA Merrill Lynch, a unit of Bank of America Corporation (BAC), BNY Mellon Capital Markets, JPMorgan Chase & Co., RBC Capital Markets, Regions Securities LLC, U.S. Bancorp and Wells Fargo Securities – would serve as the joint book-running managers for the offering.

The senior co-managers include BB&T Capital Markets, BBVA Securities, Mitsubishi UFJ Securities, Moelis & Company, and PNC Capital Markets LLC. Moreover, the other co-managers comprise Capital One Securities, Comerica Securities, Raymond James and SMBC Nikko.

Earlier in Oct 2012, Realty Income had announced the pricing of 5-year 2.00% fixed rate notes worth $350 million at 99.910%, with a yield maturity of 2.017% and maturity schedule of Jan 2018. The company also announced the pricing of 10-year 3.25% fixed rate notes worth $450 million at 99.382%, with a yield maturity of 3.323% and maturity schedule of Oct 2022.

The public offering of unsecured senior notes is expected to enable Realty Income to attain financial flexibility and position the company well to pursue investment opportunities and acquisitions. This would facilitate the company’s top-line improvement in the near term.

Realty Income currently carries a Zacks Rank #2 (Buy).


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