Benzinga | May 20, 2021 04:04PM EDT

American Homes 4 Rent Announces Public Offering Of 14M Shares

American Homes 4 Rent (NYSE:AMH) (the "Company") today announced that it has commenced an underwritten public offering of 14,000,000 of its Class A common shares of beneficial interest, $0.01 par value per share ("Class A common shares"), of which 5,500,000 shares will be offered directly by the Company, and 8,500,000 shares will be offered, at the request of the Company, by the forward purchasers (as defined below) or their respective affiliates in connection with the forward sale agreements described below. The underwriters have been granted a 30-day option to purchase an aggregate of up to an additional 2,100,000 Class A common shares.

In connection with the offering of the Class A common shares, the Company expects to enter into a forward sale agreement with each of JPMorgan Chase Bank, National Association and Bank of America, N.A. or their respective affiliates (who are referred to in such capacity individually as a "forward purchaser" and collectively, the "forward purchasers"), with respect to 8,500,000 Class A common shares covered by the offering. The forward purchasers or their respective affiliates are expected to borrow from third parties and sell to the underwriters 8,500,000 Class A common shares in connection with the forward sale agreements.

Pursuant to the terms of the forward sale agreements, and subject to the Company's right to elect cash or net share settlement under the forward sale agreements, the Company intends to issue and sell, upon physical settlement of such forward sale agreements 8,500,000 Class A common shares to the forward purchasers (or an aggregate of 10,600,000 shares if the underwriters exercise their option to purchase additional shares in full) in exchange for cash proceeds per share equal to the applicable forward sale price per share, which will initially be the public offering price per share in the offering, less underwriting discounts and commissions, and will be subject to certain adjustments as provided for in the forward sale agreements. The Company expects to physically settle the forward sale agreements in full and receive proceeds by May 21, 2022.

The Company will receive proceeds from the sale of the Class A common shares offered by it in the offering, but will not initially receive any proceeds from the sale of the Class A common shares offered by the forward purchasers or their respective affiliates to the underwriters, except in certain circumstances described in the prospectus supplement relating to the offering.

The Company intends to use the net proceeds from the offering to repay indebtedness under its revolving credit facility, to partially fund the previously announced redemption of its Series D and Series E Cumulative Redeemable Perpetual Preferred Shares and for general corporate purposes.

J.P. Morgan, BofA Securities and Wells Fargo Securities are acting as joint book-running managers for the offering, and Morgan Stanley and Raymond James are acting as book-running managers for 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 sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful before registration or qualification thereof under the securities laws of any such state or jurisdiction.

The offering is being made pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission (the "SEC") and only by means of a prospectus and prospectus supplement. Copies of the preliminary prospectus supplement relating to the offering and the final prospectus supplement, when available, may be obtained by visiting EDGAR on the SEC's website at www.sec.gov or from J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone: 1-866-803-9204; BofA Securities, Inc., NC1-004-03-43, 200 North College Street, 3rd Floor, Charlotte NC 28255-0001, Attn: Prospectus Department or by email at dg.prospectus_requests@bofa.com; or Wells Fargo Securities, Attention: Equity Syndicate Department, 500 West 33rd Street, New York, New York, 10001, at (800) 326-5897 or email a request to cmclientsupport@wellsfargo.com.