BNY Mellon to Sell Two $400 Million "Continuous Equity" Offerings
January 11, 2010
BNY Mellon Capital Markets said Monday it will act as selling agent for two $400 million "coninuous equity offerings" for companies in the hospitality industry.
The New York-based financial services company said it will act as as the exclusive selling agent for Host Hotels & Resorts, a manager of lodging in urban and resort locales, and joint selling agent for AvalonBay Communities. a developer of luxury apartment complexes.
Each company is trying to raise $400 million from what are known as Sales Agency Financing for Equity (SAFE) programs, which are an alternative to traditional secondary offerings of equity to the public. SAFE programs allow companies to raise equity capital as the need arises, by selling shares from time to time through their sales agent at current market prices. The issuer controls the timing, amount and minimum sale price of the issuances.
BNY Mellon Capital Markets began developing SAFE programs in 2001, and last year acted as agent for "at the market" equity programs registered to issue more than $2.3 billion, all told
Gary Strumeyer, president of BNY Mellon Capital Markets, called these issuanes "a practical alternative" to secondary offerings.
