NEW YORK - MFA Financial, Inc. (NYSE:MFA), a specialized finance firm with a focus on residential mortgage investments, has announced the pricing of a $100 million public offering of senior notes due in 2029, with an 8.875% interest rate. The offering, which also includes a 30-day option for underwriters to purchase an additional $15 million in notes for over-allotments, is slated to close on January 11, 2024, provided all customary closing conditions are met.
The company has applied to list the notes on the New York Stock Exchange under the ticker symbol "MFAN." Approval of this application is pending, but if successful, trading is expected to commence within 30 days post-issuance. Egan-Jones Ratings Company, an independent rating agency, has assigned the notes an investment grade rating of BBB-.
MFA Financial plans to allocate the net proceeds from this offering towards general corporate purposes. These may include the acquisition of additional residential mortgage-related assets such as whole loans, business purpose loans, mortgage-backed securities (MBS), and other mortgage-related investments. The proceeds may also be used for working capital needs, which could involve repaying existing debt, including amounts due under repurchase agreements and the company's 6.25% Convertible Senior Notes due in 2024.
The notes are to be unsecured senior obligations of the company, with interest paid quarterly starting May 15, 2024. They will mature on February 15, 2029, but the company retains the option to redeem them, in whole or in part, on or after February 15, 2026.
The joint book-running managers for the offering are Wells Fargo Securities, LLC, Morgan Stanley & Co (NYSE:MS). LLC, Piper Sandler & Co., and UBS Securities LLC. The offering will be conducted under MFA Financial's existing shelf registration statement filed with the Securities and Exchange Commission. Interested parties can obtain a prospectus and related supplement from the respective managing firms.
MFA Financial, with its wholly owned subsidiary Lima One Capital, has been investing in and servicing business purpose loans for real estate investors since its IPO in 1998. The company has distributed over $4.7 billion in dividends to shareholders and operates as an internally managed real estate investment trust.
The information in this article is based on a press release statement from MFA Financial, Inc.
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