AIM.PR.C : No Conversion to FloatingReset

Aimia Inc. has announced:

that none of its 6,000,000 Cumulative Rate Reset Preferred Shares, Series 3 (the “Series 3 Shares”) will be converted into Cumulative Floating Rate Preferred Shares, Series 4 (the “Series 4 Shares”) on April 1, 2019. During the conversion notice period, which commenced on March 4, 2019 and ended at 5:00 p.m. (Montreal time) on March 18, 2019, 65,624 Series 3 Shares were tendered for conversion into Series 4 Shares. In accordance with the rights, privileges, restrictions and conditions attaching to the Series 3 Shares and the Series 4 Shares, since there would be less than 1,000,000 Series 4 Shares outstanding on April 1, 2019, after having taken into account all Series 3 Shares tendered for conversion into Series 4 Shares, holders of Series 3 Shares who elected to tender their shares for conversion will not have their Series 3 Shares converted into Series 4 Shares on April 1, 2019. As a result, no Series 4 Shares will be issued on April 1, 2019.

It will be recalled that AIM.PR.C will reset at 6.011% effective March 31, 2019 (not 6.01%, as stated in the original press release).

AIM.PR.C is a FixedReset, 6.25%+420, that commenced trading 2014-1-15 after being announced 2014-1-6. The extension was announced 2019-2-26. I recommended against conversion. The issue is tracked by HIMIPref™ but relegated to the Scraps-FixedReset (Discount) subindex on credit concerns.

Aimia suspended preferred share dividends in June, 2017. DBRS downgraded the preferreds to Pfd-5(high) in August, 2017, and currently has them under review with developing implications. S&P declared that it considered the preferred shares to be in default in June, 2018. On February 26, 2019, Aimia announced it would be paying the accrued dividends. On March 1, S&P upgraded the credit rating to P-4(low) and discontinued the rating.

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