Schottenstein: REIT to IPO
Schottenstein owns and operates community and neighborhood shopping centers in major metropolitan centers across the U.S., mostly anchored by national retailers. The company often looks for acquisitions of distressed retail properties with the intention of redeveloping them and then bringing in big-box retailers like Wal-Mart (WMT), Bed, Bath & Beyond (BBBY) and T.J. Maxx (TJX).
Under the ticker SCRT, Schottenstein's initial public offering is expected to be priced Friday between $14 and $16 per share, following a registration five-month period at the Securities and Exchange Commission.
Around 26.7 million shares will be offered, raising between $364 million and $420 million in gross proceeds, according to SEC filings.Schottenstein said it will use $190 million of the raised capital to consolidate interest in properties it does not wholly own, $126 million to pay down corporate debt, and $27 million for working capital and to fund acquisitions. In December 2010 Schottenstein filed with the SEC that it hoped to raise $517.5 million through an IPO. Raising less capital than expected may be a reality Schottenstein is forced to face on Friday. On Wednesday of this week, RLJ Lodging Trust (RLJ), a self-advised REIT that invests in hotels, began trading on the New York Stock Exchange, selling 27.5 million shares for $18 apiece, lower than the $19 to $21 expected.
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