TSX:BPO.PR.A - Post by User
Post by
CrazyTraderon Dec 02, 2023 12:34pm
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Post# 35765172
AltaGas took out a loan at 8.9% to redeem Prefers costing
AltaGas took out a loan at 8.9% to redeem Prefers costingless than some of BPO prefers. According to AltaGas, it made financial sense.
BN is able to issue 2034 notes at 6.35%. BPO prefers yielding over 11% with reset yields looking to be around 20% on some.
It totally makes sense, if BN can issue debt at 6.35% to use it to buy BPO prefers yielding 11%+ (20%+) and keep the prefers as investment... and later sell them at double the price in a year or 2.
-Make/save immediately 5% to 8%, and maybe 14% on reset.... per year.
-Potential Gain of 100%+ on share price.
-Expense off the 6.35% interest payments to reduce taxes... so what that 30%???
-Maintain "perpetual capital" if company holds BPO as investment and not cancel them.
-EASY money.
All just my opinion/view/thinking..