RAIT Commences Public Offering Of Convertible Senior Notes Due 2033

(RTTNews) - RAIT Financial Trust (RAS) Wednesday said it has commenced a public offering of convertible senior notes due 2033.

The company expects to grant the underwriters a 30-day option to purchase up to an additional 15 percent of notes in the proposed offering.

Barclays Capital Inc. is acting as sole book-running manager for the offering.

The notes will be senior unsecured obligations of RAIT and will pay interest semi-annually. The interest rate, conversion rate, offering price and other terms of the notes will be determined at the time of pricing of the offering.

RAIT currently intends to use a portion of the net proceeds from the sale of the notes for working capital and general trust purposes, including potential repurchases of its outstanding 7 percent convertible senior notes which mature on April 1, 2031.

RAIT also plans to use a portion of the net proceeds to fund payment of the cost of a capped call transaction with an affiliate of Barclays Capital Inc., which is expected to reduce potential dilution to holders of common shares upon the potential conversion of the notes.