Capstead Mortgage Corporation Prices Public Offering of 7.50% Series E Cumulative Redeemable Preferr


Capstead Mortgage Corporation Prices Public Offering of 7.50% Series E Cumulative Redeemable Preferred Stock

DALLAS--(BUSINESS WIRE)-- Capstead Mortgage Corporation (NYSE: CMO) ("Capstead" or the "Company") announced that it priced an underwritten public offering of 6 million shares of its 7.50% Series E Cumulative Redeemable Preferred Stock (the "7.50% Series E Preferred Stock"), liquidation preference $25.00 per share, for gross proceeds of $150 million, before deducting the underwriting discount and estimated offering expenses.

The Company has granted the underwriters a 30-day option to purchase up to 900,000 additional shares of 7.50% Series E Preferred Stock to cover over-allotments, if any. The offering is subject to customary closing conditions and is expected to close on or about May 13, 2013.

Capstead intends to use the net proceeds from this offering, together with cash on hand as necessary and deemed prudent, to redeem all or a portion of the Company's outstanding Series A Preferred Stock and Series B Preferred Stock. Should the Company conclude not to use all or a portion of the net proceeds from this offering to fund a redemption transaction, such proceeds will be used for general corporate purposes.

Morgan Stanley & Co. LLC and UBS Securities LLC are serving as joint book-running managers on the offering. Keefe, Bruyette & Woods, Inc. and RBC Capital Markets, LLC are serving as joint lead managers. JMP Securities LLC and Mitsubishi UFJ Securities (USA), Inc. are serving as co-managers.

The offering is being made pursuant to the Company's existing shelf registration statement previously filed with the Securities and Exchange Commission that became effective upon filing. This press release is neither an offer to sell nor a solicitation of an offer to buy shares of 7.50% Series E Preferred Stock. The offering of these securities will be made only by means of a prospectus and related prospectus supplement, a copy of which may be obtained by contacting:

Morgan Stanley & Co. LLC
Attention: Prospectus Department
1585 Broadway
New York, NY 10036
Telephone: (866) 718-1649

UBS Securities LLC
Attention: Prospectus Department
299 Park Avenue
New York, NY 10171
Telephone: (877) 827-6444, ext. 561-3884

The prospectus supplement and the accompanying prospectus shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

Capstead is a self-managed real estate investment trust (a "REIT") for federal income tax purposes. The Company earns income from investing in a leveraged portfolio of residential adjustable-rate mortgage pass-through securities, referred to as ARM securities, issued and guaranteed by government-sponsored enterprises, either Fannie Mae or Freddie Mac, or by an agency of the federal government, Ginnie Mae.

Cautionary Note Concerning Forward-looking Statements

This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words "believe," "anticipate," "expect," "estimate," "intend," "will be," "will likely continue," "will likely result," or words or phrases of similar meaning. Forward-looking statements are based largely on the expectations of management and are subject to a number of risks and uncertainties including, but not limited to, the following:

  • the Company's expectations around the use of proceeds of this offering and the redemption of the Series A Preferred Stock and Series B Preferred Stock;

  • changes in general economic conditions;

  • fluctuations in interest rates and levels of mortgage prepayments;

  • the effectiveness of risk management strategies;

  • the impact of differing levels of leverage employed;

  • liquidity of secondary markets and credit markets;

  • the availability of financing at reasonable levels and terms to support investing on a leveraged basis;

  • the availability of new investment capital;

  • the availability of suitable qualifying investments from both an investment return and regulatory perspective;

  • changes in legislation or regulation affecting exemptions for mortgage REITs from regulation under the Investment Company Act of 1940;

  • changes in legislation or regulation affecting Fannie Mae, Freddie Mac, Ginnie Mae and similar federal government agencies and related guarantees;

  • deterioration in credit quality and ratings of existing or future issuances of mortgage securities guaranteed by Fannie Mae, Freddie Mac or Ginnie Mae; and

  • increases in costs and other general competitive factors.

In addition to the above considerations, actual results and liquidity are affected by other risks and uncertainties which could cause actual results to be significantly different from those expressed or implied by any forward-looking statements included herein. It is not possible to identify all of the risks, uncertainties and other factors that may affect future results. In light of these risks and uncertainties, the forward-looking events and circumstances discussed herein may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. Forward-looking statements speak only as of the date the statement is made and the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Capstead Mortgage Corporation
Investor Relations:
Lindsey Crabbe, 214-874-2339

KEYWORDS: United States North America Texas


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