PrefBlog

Brompton Group has announced:

Brompton Oil Split Corp. (the “Fund”) previously announced a pro-rata redemption of class A shares (the “Class A Shares”) in order to maintain an equal number of preferred shares (the “Preferred Shares”) and Class A Shares outstanding as a result of more Preferred Shares being tendered to the special non-concurrent retraction in connection with the extension of the Fund’s term for an additional three years. As a result of withdrawals from the Preferred Share retraction, the Fund will now be required to redeem 2,259,102 Class A Shares on a pro-rata basis pursuant to the Fund’s constating documents which is a reduction of approximately 70.377% of each Class A shareholders’ holdings. Each Class A shareholder of record on March 31, 2020 will receive a redemption price equal to the greater of: (i) the net asset value per unit (each unit consisting of 1 Class A Share and 1 Preferred Share) minus the sum of $10.00 plus any accrued and unpaid distributions on a Preferred Share, and (ii) nil. The redemption payment, if any, will be made on or before April 15, 2020.

The Fund invests in a portfolio of equity securities of large capitalization North American oil and gas issuers, primarily focused on those with significant exposure to oil.

Given that the NAVPU of the preferred shares as of March 23 is only 3.67 (and the Capital Unit NAV is zero, of course), it currently appears that the redemption price calculated on March 31 will be nil.

This entry was posted on Wednesday, March 25th, 2020 at 2:06 am 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.