Realty Income Prices $750 Million Offering of Senior Unsecured Notes

BY PR Newswire | CORPORATE | 10/03/22 08:21 PM EDT

SAN DIEGO, Oct. 3, 2022 /PRNewswire/ -- Realty Income Corporation (O) , The Monthly Dividend Company?, today announced the pricing of a public offering of $750 million of 5.625% senior unsecured notes due October 13, 2032 (the "Notes"). The public offering price for the Notes was 99.879% of the principal amount for an effective semi-annual yield to maturity of 5.641%.

Realty Income Corporation - The Monthly Dividend Company. (PRNewsFoto/Realty Income Corporation) (PRNewsfoto/Realty Income Corporation)

In conjunction with the pricing of this offering, the Company executed a $600 million U.S. Dollar-to-Euro 10-year cross currency swap, resulting in an anticipated receipt of approximately ?612 million in proceeds and an effective fixed-rate, Euro-denominated semi-annual yield to maturity of approximately 4.70%. Additionally, the Company has terminated forward starting interest rate swaps totaling $500 million in notional value previously entered into, recognizing a cash settlement gain of approximately $72 million. Giving effect to these contemporaneous transactions, the Company expects to recognize an effective semi-annual yield to maturity of approximately 3.93% on the overall transaction, including the recognition of the cash settlement gain noted above. ?

The net proceeds from this offering will be used for general corporate purposes, which may include, among other things, the repayment or repurchase of Realty Income's (O) indebtedness (including borrowings under Realty Income's (O) $4.25 billion multi-currency revolving credit facility or Realty Income's (O) multi-currency commercial paper programs), foreign currency or interest rate swaps or other hedging instruments, the development and acquisition of additional properties and other acquisition or business combination transactions, and the expansion and improvement of certain properties in Realty Income's (O) portfolio.

This offering is expected to close on October 13, 2022, subject to the satisfaction of customary closing conditions.

The active joint book-running managers for the offering are Barclays, Citigroup, J.P. Morgan, and Mizuho.

A copy of the prospectus supplement and prospectus, when available, related to this offering may be obtained by contacting: Barclays Capital Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, by telephone: (888) 603-5847 or email: barclaysprospectus@broadridge.com;?Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, by telephone: (800) 831-9146 or email: prospectus@citi.com; J.P. Morgan Securities LLC, 383 Madison Avenue, New York, New York 10179, Attention: Investment Grade Syndicate Desk, by telephone: 1-212-834-4533; or Mizuho Securities USA LLC, 1271 Avenue of the Americas, New York, New York 10020, Attention: Debt Capital Markets, by telephone: 1-866-271-7403.

These securities are offered pursuant to a Registration Statement that has become effective under the Securities Act of 1933, as amended. These securities are only offered by means of the prospectus included in the Registration Statement and the prospectus supplement related to the offering. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any offer or sale of these securities in any state or other jurisdiction where, or to any person to whom, the offer, solicitation, or sale of these securities would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

About Realty Income

Realty Income (O), The Monthly Dividend Company?, is an S&P 500 company and member of the S&P 500 Dividend Aristocrats? index. We invest in people and places to deliver dependable monthly dividends that increase over time. The company is structured as a REIT, and its monthly dividends are supported by the cash flow from over 11,400 real estate properties owned under long-term net lease agreements with commercial clients. To date, the company has declared 627 consecutive common stock monthly dividends throughout its 53-year operating history and increased the dividend 117 times since Realty Income's (O) public listing in 1994 .

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. When used in this press release, the words "estimated," "anticipated," "expect," "believe," "intend," and similar expressions are intended to identify forward-looking statements. Forward-looking statements also include discussions of our business and portfolio including future operations and results, the announcement of operating results, strategy, plans, and the intentions of management. Forward-looking statements are subject to risks, uncertainties, and assumptions about us, which may cause our actual future results to differ materially from expected results. Some of the factors that could cause actual results to differ materially are, among others, our continued qualification as a real estate investment trust; general domestic and foreign business and economic conditions; competition; fluctuating interest and currency rates; access to debt and equity capital markets; continued volatility and uncertainty in the credit markets and broader financial markets; other risks inherent in the real estate business including our clients' defaults under leases, potential liability relating to environmental matters, illiquidity of real estate investments, and potential damages from natural disasters; impairments in the value of our real estate assets; changes in income tax laws and rates; the continued evolution of the COVID-19 pandemic and the measures taken to limit its spread, and its impacts on us, our business, our clients (including those in the theater industry), or the economy generally; the timing and pace of reopening efforts at the local, state and national level in response to the COVID-19 pandemic and developments, such as the unexpected surges in COVID-19 cases, that cause a delay in or postponement of reopenings; the outcome of any legal proceedings to which we are a party or which may occur in the future; acts of terrorism and war; any effects of uncertainties regarding whether the anticipated benefits or results of our merger with VEREIT, Inc. will be achieved; and those additional risks and factors discussed in our reports filed with the U.S. Securities and Exchange Commission. Readers are cautioned not to place undue reliance on forward-looking statements. Those forward-looking statements are not guarantees of future plans and performance and speak only as of the date of this press release. Actual plans and operating results may differ materially from what is expressed or forecasted in this press release. We do not undertake any obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

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SOURCE Realty Income Corporation (O)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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