Invitation Homes Inc. plans to offer 77 million shares of common stock as part of its IPO, according to a filing.
The IPO price range is expected to be between $18 and $21 per share, with an expected maximum aggregate offering price of approximately $1.86 billion, including up to an additional 11,550,000 shares that underwriters can purchase to cover overallotments.
The company, which is Blackstone Group LP's single-family rental unit, plans to qualify as a REIT. Blackstone affiliates will continue to own a majority of the voting power after the IPO.
Under a Jan. 12 commitment letter, Wells Fargo Bank NA and Fannie Mae agreed to fund a new 10-year mortgage loan with up to $1.00 billion in principal amount. The fixed-rate loan will be collateralized by some of the company's homes.
Invitation Homes said it will enter into the loan after the IPO and use the net proceeds to repay all remaining amounts outstanding under its mortgage loan relating to the IH1 2014-1 securitization and roughly $275.0 million of its mortgage loan relating to the IH1 2014-2 securitization.
According to Jan. 24 report in The Wall Street Journal, this marks the first time that government-backed Fannie Mae has agreed to guarantee the debt of an institutional owner of single-family homes.
Additionally, Invitation Homes said it expects to enter into a new $2.50 billion credit facility with a syndicate of lenders, comprising a $1.50 billion term loan and a $1.00 billion revolving credit facility. The closing of this credit facility is subject to the consummation of the IPO, and the company said it will use the net proceeds to repay existing debt.
The group of underwriters for the IPO comprises Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Merrill Lynch Pierce Fenner & Smith Inc., Goldman Sachs & Co., Wells Fargo Securities LLC, Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC, RBC Capital Markets LLC, Blackstone Advisory Partners LP, BTIG LLC, Evercore Group LLC, FBR Capital Markets & Co., JMP Securities LLC, Keefe Bruyette & Woods Inc., Raymond James & Associates Inc., Siebert Cisneros Shank & Co. LLC and Zelman Partners LLC.