Taubman Raises Cap for Debt Payoff - Analyst Blog


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Recently, Taubman Centers Inc. ( TCO ) disclosed the pricing of $150 million of 6.25% Series K cumulative redeemable Preferred Stock. The move comes as part of its efforts to raise capital for decreasing its outstanding borrowings.

Particularly, Taubman announced the pricing of an underwritten public offering of 6,000,000 shares of 6.25% Series K Cumulative Redeemable Preferred Stock at a price of $25.00 per share. Alongside, underwriters have been granted an option to purchase up to an additional 900,000 shares within 30 days exclusively to cover over-allotments, if any.

The move is a strategic fit as it would add to Taubman's financial flexibility and help lower its borrowings under its $1.165 billion revolving lines of credit. This, in turn, would reduce its interest expenses.

The joint book-running managers for the offering, which is expected to close on Mar 15, 2013, are Morgan Stanley ( MS ) and Wells Fargo Securities of Wells Fargo & Company ( WFC ). The joint lead managers for the offering are JPMorgan Chase & Co. ( JPM ) and Jefferies. Notably, on or after Mar 15, 2018, Taubman has the option to redeem the Series K cumulative redeemable Preferred Stock at a price of $25.00 per share.

Mich.-based Taubman Centers Inc. is a real estate investment trust (REIT), which is engaged in the ownership, management and/or leasing of 27 regional, super-regional and outlet shopping centers in the U.S. and Asia.

Taubman has a solid portfolio of the best-in-class retail malls that generates robust mall tenant sales. Acquisitions of favorably situated assets are expected to be accretive to its top line going forward. Also, the company's capital moves are encouraging.

Moreover, last month, Taubman came up with an impressive fourth quarter and full year 2012 earnings results, primarily driven by increase in rents and robust occupancy levels.

Taubman currently retains a Zacks Rank #2 (Buy).

JPMORGAN CHASE (JPM): Free Stock Analysis Report

MORGAN STANLEY (MS): Free Stock Analysis Report

TAUBMAN CENTERS (TCO): Free Stock Analysis Report

WELLS FARGO-NEW (WFC): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
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