Aliso Viejo-based hotel owner Sunstone Hotel Investors Inc. has priced 4 million shares of preferred stock in an offering that’s set to raise $100 million before fees.
Sunstone plans to use the proceeds for acquisitions and as working capital.
The shares are what are known as cumulative redeemable preferred stock, which means they accrue dividends even if the company doesn’t declare one for shareholders.
The shares also can be redeemed by Sunstone starting in 2016.
Underwriters could sell an additional 600,000 shares in the next month to meet demand beyond on the 4 million shares being issued.
Sunstone, which has a market value of $1.2 billion, owns all or part of 33 hotels across the country, including the Fairmont Newport Beach and the Hyatt Regency Newport Beach.
The company and others are under the gun to acquire hotels before a brewing industry turnaround drives up prices.
Earlier this week, Sunstone said it struck a deal to buy a 75% stake in a joint venture that owns the 1,190-room Hilton San Diego Bayfront hotel in San Diego. The deal is valued at $475 million.
