Xstrata has announced that the two captioned issues will be redeemed on November 1, 2006.
each series F share will be redeemed for C$25.50 in cash, each series G share will be redeemed for C$25.00 in cash … plus accrued and unpaid dividends in respect of each share up to, but excluding, 1 November 2006.
FAL.PR.F became a ratchet rate preferred on 2005-07-06 and its most recent dividends have been $0.115 monthly, or $1.38 annually, or 5.52% on the issue price, or 5.41% against the redemption price. It ended today quoted at 25.33-55, 83×100 (big size for this issue!), but with no trading.
FAL.PR.G was its opposite number, and has been paying $0.38125 quarterly, or $1.525 annually, or 6.1% on its issue price (= redemption price).
These shares used to be Noranda and the provisions stated on Page C-6 of the 2005-06-02 Information Circular (sorry, I don’t have the original prospectus handy!) states that the fixed rate option could be as low as 80% of the 5-year Canada Yield. I can only presume that XStrata decided it could not bank on the ratchet-rate prefs yielding a low enough percentage of prime to make a lousy rate on the fixed-rate side worthwhile.
So anyway, there’s a ratchet-rate pref gone!
[…] As noted in an earlier post, Falconbridge’s new owners redeemed the issues FAL.PR.F (securityCode A36042) and FAL.PR.G (security code A36043). These entries have now been processed to the HIMIPref™ database, delistingDate 2006-11-02. […]