PrefBlog

STRATA Income Fund has announced:

its intention to make a normal course issuer bid for its Capital Units and Preferred Securities through the facilities of the Toronto Stock Exchange (the “TSX”). This normal course issuer bid is intended to commence on March 10, 2009 and will terminate on March 9, 2010. In accordance with the Declaration of Trust by which STRATA is governed, market purchases pursuant to its normal course issuer bid may be effected by the Fund.

The Fund had 7,637,608 Capital Units and 3,843,054 Preferred Securities issued and outstanding as at February 27, 2009. STRATA may, during the 12 month period commencing March 10, 2009 purchase on the TSX up to 763,760 Capital Units and 364,498 Preferred Securities, being 10% of the public floats of 7,637,608 Capital Units and 3,644,980 Preferred Securities, respectively, and may not, in any 30 day period, purchase more than 152,752 Capital Units and 76,861 Preferred Securities, being 2% of the respective securities issued and outstanding. STRATA will hold in treasury for resale all capital units and preferred securities purchased pursuant to the bid. As at February 27, 2009, STRATA had purchased 55,600 Capital Units and 48,900 Preferred Securities at an average price of $2.92 per Capital Unit and $9.04 per Preferred Security under its previously approved normal course issuer bid.

The quoted figures imply that there are 1.99 Capital Units per Preferred Security. The Capital Unit NAV was $2.37 on February 26, implying asset coverage of 1.5-:1 as of that date.

The capital units closed at 1.49-70, 4×3 today, while the preferreds were at 9.35-74, 1×7. It would appear that the NCIB is, in fact, beneficial to unitholders of both types.

STW.PR.A was last mentioned on PrefBlog when the Capital Units’ distribution was reduced.

STW.PR.A is tracked by HIMIPref™ and included in the Interest-Bearing sub-index.

This entry was posted on Friday, March 6th, 2009 at 8:01 pm and is filed under Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.