PrefBlog

Newgrowth Corp. has announced:

that holders of its Class A Capital Shares (“Capital Shares”) have overwhelmingly approved a share capital reorganization (the “Reorganization”) allowing holders of Capital Shares, at their option, to retain their investment in the Company after the scheduled redemption date of June 26, 2009. The Reorganization will permit holders of Capital Shares to extend their investment in the Company beyond the redemption date of June 26, 2009 for up to an additional 5 years. The Class B Preferred Shares will be redeemed on the same terms originally contemplated in their share provisions and have been called for redemption on June 26, 2009. In order to maintain the leveraged “split share” structure of the Company, the Company expects to create and issue a new series of Class B preferred shares on or about June 26, 2009.
…
The Reorganization will involve an adjustment of the Company’s Portfolio so that the Company provides broader exposure to Canadian chartered banks, telecommunication, utility and pipeline companies and the Portfolio will be rebalanced to an equal weight position in order to improve diversification and mitigate single issuer exposure.

Holders of Capital Shares who do not wish to continue their investment in the Company after June 26, 2009 must give notice that they wish to exercise their special retraction right and how they wish to be paid for their shares on or prior to May 29, 2009. Holders of Capital Shares who retract their Capital Shares will be paid on June 26, 2009. The Reorganization will become effective provided that holders of at least 1,340,000 Capital Shares retain their Capital Shares and do not exercise the special retraction right.

There are currently 2,327,407 units outstanding with a NAV of $38.12/unit so there is the potential for this to be a reasonably large-sized offering of replacement preferreds.

NEW.PR.B was last mentioned on PrefBlog when the proposed refunding was announced. NEW.PR.B is not tracked by HIMIPref™.

This entry was posted on Monday, May 11th, 2009 at 5:45 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.