Invesco Mortgage Capital Planning Another Share Sale
Seeing a growing appetite for deals from investors, Invesco Mortgage Capital (IVR), a real estate investment trust (REIT), plans to offer 7m shares of its common stock for sale in order to fund the acquisition of residential and commercial mortgage-backed securities (RMBS and CMBS) and leveraged mortgage loans. The REIT, which went public in June, announced in September that its shares would be listed on Russell indices. The IPO offered 8.5m shares of Invesco Mortgage at $20 per share, and in the end, raised $201m. It was the first blind IPO in the REIT space for 13 months. The Invesco REIT is unusual, at least in the leveraged loan space, in that it buys Triple-A paper, regardless of whether it is agency or non-agency. The IPO settled July 1, and by July 17 the company finalized a comprised portfolio of $711.9m in agency RMBS, $67.8m in non-agency RMBS and $49.7m in CMBS. The Company also entered into repurchase agreements totalling $630.6m, secured by $669.7m in agency RMBS, and has applied for $41.2m in financing under the Federal Reserve’s Term Asset-Backed Securities Lending Facility (TALF) secured by $49.7m in CMBS. Credit Suisse and Morgan Stanley are joint bookrunners on the new offering, which will be made only by means of a prospectus. Currently, bankers from the two firms and Invesco REIT managers are roadshowing the new deal. And while the IPO hit the market lower than expected, the fact that, six months on, Invesco is on the road selling again is indicative of a growing investor appetite. Write to Jacob Gaffney.