Curbline Properties launches $120M stock offering to fuel property buys
What's the deal? Curbline PropertiesDealroom has a profile for this one. Try Dealroom → (NYSE: CURB) has launched an underwritten public offering of 10,000,000 shares of common stock, expected to raise roughly $120,270,000.
The offering uses forward sale agreements, with Goldman SachsDealroom has a profile for this one. Try Dealroom →, Morgan StanleyDealroom has a profile for this one. Try Dealroom →, and Wells Fargo SecuritiesDealroom has a profile for this one. Try Dealroom → acting as underwriters.
Underwriters also get a 30-day option to buy up to 1,500,000 additional shares.
Why now? The real estate firm intends to use net proceeds for general corporate purposes, including funding property acquisitions, working capital, capital expenditures, and repaying debt.
Forward sale agreements let Curbline lock in today's share price while delaying when it issues stock and collects cash. It expects to settle within roughly 18 months.
What could go wrong? The structure carries execution risk. Forward purchasers must borrow and sell shares through third parties.
If they cannot borrow shares, or if borrowing costs climb above a set threshold, those obligations fall away. In that case, Curbline would issue and sell the shares directly to the underwriters instead.
The company also won't receive any proceeds until settlement, and it retains the right to settle in cash or net shares rather than physical delivery.
The signal: As a breakout-stage REIT focused on convenience shopping centres, Curbline is leaning on a trio of Wall Street heavyweights — Goldman Sachs, Morgan Stanley, and Wells Fargo Securities — to fund an acquisition push in a niche retail segment. The forward structure lets it lock in pricing now while timing dilution to match a property pipeline it expects to deploy over the next 18 months.
Read more: Business Wire
