Financial Sector Update for 06/20/2018: NMRK,RY,RY.TO,NDAQ,QTS,CBRE,AIG

Top Financial Stocks

JPM +0.17%

BAC +0.17%

WFC -0.88%

C +1.08%

USB -0.72%

Financial stocks have turned narrowly mixed in late trade, with the NYSE Financial Sector Index weakening but hanging on to a nearly 0.3% rise while financial companies in the S&P 500 Index were dropping just over 0.2%. The Philadelphia Housing Sector Index also was slightly more than 0.2% higher.

Among financial stocks moving on news:

+ Newmark Group ( NMRK ) rose Wednesday, at one point climbing over 3%, after the real estate services disclosed the $175 million issue of exchangable preferred limited partnership units to The Royal Bank of Canada (RY,RY.TO) earlier this week in a deal monetizing Nasdaq ( NDAQ ) shares it regularly receives following the June 2013 sale of its former eSpeed business to the stock market operator. Newmark said it expects to receive around $153 million in net proceeds from the June 18 transaction and plans to use those funds to repay a portion of its $400 million converted term loan, leaving about $247 million still outstanding on the loan maturing in September 2019. Newmark also will be able to draw up to $153 million from its revolving credit facility following the upcoming loan repayment. This week's monetization had no effect on the $93.5 million stock payment due Newmark from Nasdaq later this summer, the company said, adding it is scheduled to receive another $650 million in Nasdaq shares spread across seven annual payments resuming in 2021.

In other sector news:

+ CBRE Group ( CBRE ) was narrowly higher Wednesday after the real estate broker agreed to buy an undisclosed majority stake in Israeli facilities manager Ramot Group. Ramot also provides technical maintenance, project management, reception administration, environmental health and safety and cleaning services and will be merged into CBRE's Global Workplace Solutions business in Israel. The deal is expected to close later this summer.

- American International Group ( AIG ) was see-sawing between small gains and losses on Wednesday, most recently slipping back to negative ground, after the insurance company said its UK-based AIG Life Ltd subsidiary has agreed to acquire Ellipse, a group life insurer that also provides critical illness and income protection products, from its current owner Munich Re. AIG did not disclose the price tag for Ellipse but it said it will fully fund the purchase using available cash. The deal is expected to close during the first three months of 2019.

- QTS Realty Trust ( QTS ) was retreating Wednesday, dropping almost 1% in recent trading, after the real estate investment trust began a $225 million public offering of 2.25 million shares of its Series B cumulative convertible perpetual preferred stock at $100.00 apiece. The company also plan to issue a 30-day option to the underwriters to buy up to 337,500 additional shares of the preferred stock to cover over-allotments. It plans to use the net proceeds to pay down its unsecured revolving credit facility and for other general corporate purposes.

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

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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.

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