American Capital shares slip in market debut
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(AP) - Shares of American Capital Agency Corp. slipped in their first day of trading Thursday. The real estate investment trust's initial public offering of 10 million shares priced as expected at $20 apiece.
After opening at $19.50, shares hit a low of $19.17 and a high of $19.65. Shares recently traded down 61 cents, or 3.1 percent, to $19.39.
American Capital raised gross proceeds of $200 million, which will be used to invest in single-family residential mortgage pass-through securities and collateralized mortgage obligations guaranteed by a U.S. government agency or a U.S. government-sponsored entity.
American Capital said in its prospectus with the Securities and Exchange Commission that it expects financing of agency securities to continue to be available on favorable terms, despite turmoil in the residential mortgage market.
Concurrent with the IPO, private equity fund American Capital Strategies Ltd. agreed to buy $100 million, or 5 million shares, of the company's stock in a private placement.
American Capital will be externally managed and advised by an American Capital Strategies portfolio company.
Originally, the Bethesda, Md.-based company had expected to offer 12.5 million shares to the public for $20 apiece, and sell 2.5 million shares to American Capital Strategies in a private placement.
Shares are trading on the Nasdaq Global Market under the symbol "AGNC."