Chemtrade Logistics Income 6 50 Convertible Unsecured Subordinated Debentures T.CHE.DB.E

Any ideas as to why ....

[CanSiamCyp]

.... the unit price is sliding after announcing the debenture redemption?

https://money.tmx.com/quote/CHE.UN/news/8710537023566780/CHEMTRADE_LOGISTICS_INCOME_FUND_ANNOUNCES_REDEMPTION_OF_ITS_REMAINING_850_CONVERTIBLE_UNSECURED_SUBORDINATED_DEBENTURES_DUE_SEPTEMBER_30_2025

I am not very familiar with the workings of convertible debentures nor the specifics of this 8.50% CHE debenture .... however ... I assume that the unit price is within the conversion range for this debenture .... hence the company's desire to redeem them at par value (versus the 30% premium offered in the SIB last month) to forestall the conversion.

I get that a mass conversion of the debentures to units would dilute earning per unit, etc. .... however would't swapping an 8.5% debenture interest obligation for a 6.9% distribution (current) obligation make sense? Also, such a conversion would improve the companies debt to book value ratio.

What am I missing here? Any comments from those with greater insight?

[Red_Deer]

Here are the DETAILS of the 8.5% Convertible Debentures. Chemtrade Logistics Income Fund Announces Increase to Previously Announced Convertible Debenture Bought Deal Financing to $75 Million   Toronto, Ontario – (August 20, 2020) — Chemtrade Logistics Income Fund (“Chemtrade” or the “Fund”) (TSX: CHE.UN) announced today that, due to strong demand, the Fund has increased the size of the

[raybay_98]

IMHO, these Debenture holders are the smart money and the Common Stock holders are the dumb money! 8.5 annual interest plus $7.35 conversion what's not to like!