DC.PR.B Closes Firm on Heavy Volume

The DC FixedReset 6.75%+410 announced August 25 has closed and is now trading as DC.PR.B.

Dundee Corporation was pleased to announce:

that it has completed its offering of 4,600,000 Cumulative 5-Year Rate Reset First Preference Shares, Series 2 (“Rate Reset Series 2 Preference Shares”) of the Company at a purchase price of $25.00 per Rate Reset Series 2 Preference Share, for aggregate gross proceeds of $115,000,000. The Rate Reset Series 2 Preference Shares are listed on the Toronto Stock Exchange under the symbol DC.PR.B.

The offering was underwritten on a bought deal basis by a syndicate co-led by GMP Securities L.P. and Scotia Capital Inc. that included BMO Nesbitt Burns Inc., CIBC World Markets Inc., Dundee Securities Corporation, National Bank Financial Inc., TD Securities Inc., Canaccord Capital Corporation and Raymond James Ltd.

The gross proceeds of $115-million implies that the greenshoe was not taken up.

The issue traded 722,705 shares before closing at 25.07-08, 40×63. Vital statistics are:

DC.PR.B YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2039-09-15
Maturity Price : 24.82
Evaluated at bid price : 25.07
Bid-YTW : 6.62 %

By way of comparison, DC.PR.A is retractible and closed at 21.25-40 today to yield 7.91% to a SoftMaturity 2016-6-29. If the relative pricing of these issues makes any sense to anybody, please drop me a line explaining it!

DC.PR.B is tracked by HIMIPref™ but is relegated to the “Scraps” index due to credit concerns.

Update, 2009-9-16 Here’s a relative pricing clue!

The race is on to see how long it will take DC.PR.B to reach 26-26.50 like the other fixed resets.

The issue had closed about 2 hours after it was posted and just started trading yesterday.

I didn’t get any at the IPO but sold all of my MFC.PR.E to buy this one and will also sell at 26 or 27, probably in a month or two if history repeats itself.

FixedReset structure + new issue = free money? Well, it’s one way to invest.

This entry was posted on Tuesday, September 15th, 2009 at 7:52 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.

2 Responses to “DC.PR.B Closes Firm on Heavy Volume”

  1. PrefBlog » Blog Archive » HIMIPref™ Index Rebalancing: September, 2009 says:
    October 1, 2009 at 12:44 pm

    […] New Issue […]

  2. DC.PR.A & DC.PR.B Now Unrated By Agencies « PrefBlog says:
    December 10, 2012 at 10:35 pm

    […] DC.PR.A and DC.PR.B are tracked by HIMIPref™, but relegated to the Scraps index on credit […]

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