Realty Income (NYSE:O) priced a public offering of $750M of 5.625% senior unsecured notes due Oct. 13, 2032.
The offering price was 99.879% of the principal amount for an effective semi-annual yield to maturity of 5.641%.
In conjunction with the pricing, Realty executed a $600M U.S. Dollar-to-Euro 10-year cross currency swap, which led to an anticipated receipt of ~€612M in proceeds and an effective fixed-rate, Euro-denominated semi-annual yield to maturity of ~4.70%.
In addition, the company terminated forward starting interest rate swaps totaling $500M in notional value previously entered into, recognizing a cash settlement gain of ~$72M.
Giving effect to these transactions, Realty expects to recognize an effective semi-annual yield to maturity of ~3.93% on the overall transaction, including the recognition of the cash settlement gain.
Realty intends to use the net proceeds for general corporate purposes, which may include, debt repayment or repurchase, hedging instruments, and development/acquisition of properties.