Eagle Point Income Company Inc. Prices Offering of Preferred Stock
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Eagle Point Income Company Inc.'s recent pricing of its Series C Term Preferred Stock is a strategic move to raise capital. The offering size and the fixed 8.00% dividend rate are competitive, especially considering the current interest rate environment. The 'BBB' rating by Egan-Jones suggests a moderate level of creditworthiness, which could appeal to risk-averse investors seeking stable returns. However, the market's reception will hinge on the company's performance, sector outlook and prevailing economic conditions.
The potential for an additional 183,000 shares through the underwriters' option could indicate confidence in the offering's success, but it also introduces the possibility of dilution. The net proceeds of approximately $29.3 million will likely be used to finance the company's operations or pay down existing debt, which could improve its financial stability and potentially enhance shareholder value in the long term.
The decision to list the Preferred Stock on the New York Stock Exchange under the symbol 'EICC' within 30 days of the issue date is a significant step towards increasing liquidity and visibility in the market. This move could attract a broader investor base and potentially improve trading volumes. The involvement of established financial institutions as joint bookrunners and lead managers, including Ladenburg Thalmann and Piper Sandler, lends credibility to the offering and may boost investor confidence.
Investors should be aware that Preferred Stock typically ranks higher than common stock in terms of claims on assets and earnings, which provides an additional layer of security in the event of liquidation. However, the fixed dividend rate also means that investors will not benefit from any potential increase in the company's profitability beyond the predetermined dividend yield.
The offering's compliance with SEC regulations and the filing of the preliminary prospectus supplement are important for transparency and investor protection. The investment community should review the prospectus supplement and accompanying prospectus to understand the risks and charges associated with this investment. The legal framework ensures that all material information is disclosed, allowing investors to make informed decisions.
It's also important to note that the rating by an independent agency does not guarantee the investment's performance, but it does provide a benchmark for assessing risk. The legal implications of the underwriters' option to purchase additional shares should be clear in the terms and conditions to avoid any future disputes or misunderstandings.
The Preferred Stock offering is expected to close on April 3, 2024, subject to customary closing conditions. The Company intends to list the Preferred Stock on the New York Stock Exchange within 30 days of the original issue date under the symbol “EICC.”
Ladenburg Thalmann & Co. Inc., B. Riley Securities, Inc. and Piper Sandler & Co. are acting as joint bookrunners for the offering. InspereX LLC and Wedbush Securities Inc. are acting as lead managers for the offering.
Investors should consider the Company’s investment objectives, risks, charges, and expenses carefully before investing. The preliminary prospectus supplement dated March 26, 2024 and the accompanying prospectus dated June 29, 2023, which have been filed with the Securities and Exchange Commission (“SEC”), contain this and other information about the Company and should be read carefully before investing. The information in the preliminary prospectus supplement, the accompanying prospectus and this press release is not complete and may be changed. The preliminary prospectus supplement, the accompanying prospectus and this press release are not offers to sell these securities and are not soliciting an offer to buy these securities in any state where such offer or sale is not permitted.
A shelf registration statement relating to these securities is on file with and has been declared effective by the SEC. The offering may be made only by means of a prospectus and a related prospectus supplement, copies of which may be obtained by writing Ladenburg Thalmann & Co. Inc. at 640 Fifth Avenue, 4th Floor,
Egan-Jones Ratings Company is a nationally recognized statistical rating organization (NRSRO). A security rating is not a recommendation to buy, sell or hold securities, and any such rating may be subject to revision or withdrawal at any time by the applicable rating agency.
ABOUT EAGLE POINT INCOME COMPANY
The Company is a diversified, closed-end management investment company. The Company’s primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation, by investing primarily in junior debt tranches of collateralized loan obligations (“CLOs”). In addition, the Company may invest up to
FORWARD-LOOKING STATEMENTS
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the prospectus and the Company’s other filings with the SEC. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.
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Investor Relations:
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203-340-8510
ir@EaglePointIncome.com
www.eaglepointincome.com
Source: Eagle Point Income Company Inc.
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