Gear Energy Ltd T.GXE

From Energy Summary today...

[AlexPKeaton89]

Lastly, Don Gray's Alberta- and Saskatchewan-focused Gear Energy Ltd. (GXE) edged up one cent to 51 cents on 2.54 million shares. The stock has seen heavier-than-usual volume over the last few days -- with a record 8.36 million shares being traded on Monday -- as investors awaited the pricing details of a proposed shares-for-debt swap. The company announced on March 16 that it would redeem $12.7-million worth of convertible debentures on April 26. First it sought voluntary conversions, which led to $9.7-million of the debentures becoming 29.2 million shares (at a conversion price of 32 cents a share) on March 23. Now Gear is clearing out the remaining debentures at a redemption price of 49 cents a share.

Gear would rather have the dilution than the interest costs. Although the debentures were not actually due for 2-1/2 more years, Gear calculated that if it redeemed them early, it would enjoy annual interest savings of $900,000. President and CEO Ingram Gillmore hinted that he has big plans for the money. He told investors last month that the redemption would "further enhance Gear's exceptional balance sheet, providing strategic optionality to consider future acquisitions or development capital expansions."

[AliNaimi]

'enjoy annual interest savings of $900,000' I believe this is just a bonus not the reason big plans for the money.....providing strategic optionality to consider future acquisitions or development capital expansions." I also believe the big plans are more likely to do with future acquisitions.