NEW YORK, Oct. 10 /PRNewswire-FirstCall/ — iStar Financial Inc. (NYSE: SFI), a leading publicly traded finance company focused on the commercial real estate industry, announced today the pricing of $800 million aggregate principle amount of its convertible senior floating rate notes due 2012. These Notes priced at par, mature on October 1, 2012, and will bear interest at a rate per annum equal to 3-month LIBOR plus 0.50%. The offering is expected to close on October 15, 2007.
The Notes will be senior unsecured obligations of iStar Financial and will rank equally with all of the Company’s other senior unsecured indebtedness. On or after August 15, 2012, or prior to that upon the occurrence of specific events, the Notes will be convertible by the holders into cash, shares of common stock, or any combination thereof at the Company’s option at an initial conversion rate of 22.2000 shares per $1,000 principal amount of Notes, which is equal to an initial conversion price of approximately $45.05 per share. This represents an approximately 30% conversion premium based on the last reported sale price of $34.65 per share of the Company’s shares on the New York Stock Exchange on October 10, 2007.
iStar has granted the underwriters a 30-day option to purchase up to an additional $120 million principal amount of the Notes.
iStar Financial expects to use half of the net proceeds from the offering to repay outstanding indebtedness under the unsecured interim financing facility which the Company used to fund its acquisition of the commercial real estate lending business of Fremont General Corporation. iStar expects to use the balance of the net proceeds to repay other outstanding indebtedness. Citi and JPMorgan acted as joint book-running managers for the offering and as representatives of the underwriters.
Interested parties may obtain a written copy of the final prospectus supplement and accompanying prospectus relating to the Notes offering by contacting Citi at Brooklyn Army Terminal, 140 58th Street, 8th Floor, Brooklyn, NY 11220, telephone: (718) 765-6732, fax: (718) 765-6734; or JPMorgan at 4 Chase Metrotech Center, CS Level, Brooklyn, NY 11245, telephone: (866) 430-0686, fax: (718) 242-1350.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation, or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. A registration statement relating to the securities has been filed with the Securities and Exchange Commission and is effective. The public offering is being made by means of a prospectus supplement and accompanying prospectus.
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iStar Financial Inc. is a leading publicly traded finance company focused on the commercial real estate industry. The Company primarily provides custom-tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust (“REIT”), seeks to deliver strong dividends and superior risk-adjusted returns on equity to shareholders by providing innovative and value added financing solutions to its customers. Additional information on iStar Financial is available on the Company’s website at http://www.istarfinancial.com.
(Note: Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although iStar Financial Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from iStar Financial Inc.’s expectations include completion of pending investments, continued ability to originate new investments, the mix of originations between structured finance and corporate tenant lease assets, repayment levels, the timing of receipt of prepayment penalties, the availability and cost of capital for future investments, competition within the finance and real estate industries, economic conditions, loss experience and other risks detailed from time to time in iStar Financial Inc.’s SEC reports.)
SOURCE iStar Financial Inc.
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