- DigitalBridge’s Series H preferred (DBRG.PR.H) fell about 16%, pushing its yield to roughly 9% amid uncertainty from SoftBank’s pending take-private deal.
- SoftBank will buy the common at $16/share in a ~$4B transaction expected to close in H2 2026, while the preferred has no put and likely remains outstanding.
- Series H is a 7.125% cumulative, perpetual, callable preferred paying $0.4453 quarterly, with forward yield varying (~7.4%–9%) based on price and liquidity.
- Key risks are delisting/loss of SEC reporting, weaker liquidity and potential leverage or capital-structure changes under SoftBank, though redemption or yield compression could provide upside.
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DigitalBridge’s preferred Series H stock (DBRG.PR.H) is currently exhibiting characteristics of both opportunity and risk under the backdrop of the announced SoftBank acquisition. While the rights of preferred stockholders don’t automatically align with those of common stock in a common-stock acquisition, market pricing has adjusted sharply in light of absence of a put option and continued obligations under the preferred securities.
Coupon and yield: The Series H preferred is a 7.125 % cumulative, perpetual preferred, paying $0.4453 per quarter, which annualizes to roughly $1.7812 per share. With pricing dropping ~16 %, the yield has climbed into the high-8 to ~9 % range, depending on which source and price point you use.
Acquisition implications: SoftBank’s agreed purchase of all DigitalBridge common shares for US$16 in cash implies a full valuation for common equity, but Series H preferred holders are not included in that deal. The preferred shares are expected to remain outstanding post-transaction with no put at par. This distinction leaves them exposed to risks: they may lose SEC reporting requirements (impairing transparency), experience reduced trading liquidity, and be subject to future capital structure shifts under SoftBank’s control.
Valuation upside vs. downside: Upside materializes if SoftBank, post-closing, redeems or repurchases the preferred at better terms, or if pricing narrows due to yield compression as risk premium declines. However, downside includes continued discount to liquidation value, cash flow risk if preferred dividends become less prioritized, and exposure to credit or leverage risk of parent structure under new ownership. Also, preferred liquidity is likely to be significantly reduced once the company goes private or delists.
Strategic implications: For yield-seeking investors, Series H may represent a compelling pick provided the investor demands sufficient margin and accepts the risks of being in a perpetual preferred in a private or quasi-private structure. Portfolio construction should emphasize size of exposure, ability to hold long-term, and monitoring of regulatory and financing developments post-deal. Institutional investors might demand covenants or negotiate for protective terms, whereas speculators may be betting on market correction of the risk premium.
Open questions:
- Will SoftBank offer any redemption or optional treatment for preferred issues like Series H post-closing?
- What degree of leverage will SoftBank apply to DigitalBridge after closing, and could that affect preferred security seniority or financial stress?
- How will delisting or loss of reporting status affect the ability to value, trade, or enforce preferred rights?
- What are the tax, accounting, or cross-jurisdictional complications given SoftBank’s global structure, especially for non-U.S. holders?
Supporting Notes
- SoftBank agreed to acquire DigitalBridge common stock at US$16 per share in cash; transaction enterprise value of ~US$4 billion; expected to close H2 2026.
- Preferred shares of Series H dropped ~16 %, yielding ~9 % following announcement; no put option at par for preferred holders.
- Series H is 7.125 % cumulative redeemable perpetual preferred; dividends of $0.4453 per share per quarter.
- Forward yield reported varied: ~7.42 % to ~9 % depending on market price depreciation and yield calculation.
- Preferred investors face risks: loss of SEC reporting, reduced liquidity, uncertain strategy and leverage under new ownership; but some view current yield as attractive at high-risk discount.