{"id":18531,"date":"2012-05-03T17:26:11","date_gmt":"2012-05-03T21:26:11","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=18531"},"modified":"2012-05-03T17:26:11","modified_gmt":"2012-05-03T21:26:11","slug":"bce-pr-f-secondary-offering","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=18531","title":{"rendered":"BCE.PR.F Secondary Offering"},"content":{"rendered":"

I am advised by multiple authoritative sources that there is a secondary offering under way (or is it “under weigh”? You can find much furious discussion of this on the web<\/a>) for 2-million shares of BCE.PR.F, offered at 23.75.<\/p>\n

The issue closed today at 23.95-98, 12×177. This is a wonderful issue for analysis, because there are so many ways of looking at comparators, but the easiest is its Strong Pair BCE.PR.E, a RatchetRate preferred. The two issues are interconvertible on 2015-2-15<\/a> and every five years thereafter. Until then BCE.PR.F pays a fixed 4.541% of par. while BCE.PR.E pays 100% of Canadian Prime, although this may be reduced if the price goes above 25.00.<\/p>\n

BCE.PR.E closed today at 22.40-50 on less than a board lot traded; we can use this price for comparison purposes since it is close to the other BCE RatchetRates. The Pairs Equivalency Calculator<\/a> (quick method) tells us that given a price of 22.40 on BCE.PR.E and 23.75 on BCE.PR.F, Canada Prime should average 2.32% until the February, 2015, Exchange Date for the total return on the two issues to be equal.<\/p>\n

Seeing as Canada Prime is now 3.00% and is forecast to rise, if anything, over the next three years, BCE.PR.F looks grossly expensive at 23.75. I suspect that it is trading on the basis of its Current Yield of 4.78% and that the market is, as usual, ignoring conversion and dividend reset probabilities.<\/p>\n

BCE.PR.F was last mentioned on PrefBlog when there was a secondary offering three-odd months ago<\/a>. BCE.PR.F is tracked by HIMIPref™ but is relegated to the Scraps index on credit concerns.<\/p>\n","protected":false},"excerpt":{"rendered":"

I am advised by multiple authoritative sources that there is a secondary offering under way (or is it “under weigh”? You can find much furious discussion of this on the web) for 2-million shares of …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-18531","post","type-post","status-publish","format-standard","hentry","category-issue-comments"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/18531","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18531"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/18531\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18531"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18531"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18531"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}