Partners Value Split Corp. has announced:
its intention to redeem all of its outstanding Class AA Preferred Shares, Series 1 (the “Series 1 Preferred Shares”) (TSX: PVS.PR.A) for cash on March 28, 2016 (the “Redemption Date”). The redemption price per Series 1 Preferred Share will be equal to C$25.00 plus accrued and unpaid dividends of C$0.091541 thereon to March 28, 2016, representing a total redemption price of C$25.091541 per Series 1 Preferred Share (the “Redemption Price”). Formal notice will be delivered to holders of Series 1 Preferred Shares in accordance with the terms of the Series 1 Preferred Shares.
From and after the Redemption Date the Series 1 Preferred Shares will cease to be entitled to dividends or any other participation in any distribution of the assets of the Company and the holders thereof shall not be entitled to exercise any of their other rights as shareholders in respect thereof except to receive the Redemption Price (less any tax required to be deducted and withheld by the Company). After the redemption of the Series 1 Preferred Shares, the Company will consolidate the existing capital shares held by Partners Value Investments Inc. so that there are an equal number of preferred shares and capital shares outstanding.
It will be recalled that this redemption was funded well in advance by the issue of PVS.PR.E – part funds from this issuance were used to pay a dividend to the capital unitholder.
I’m confused about this split. Where are the capital shares, and how can the downside protection be calculated?