Enbridge Inc T.ENB.PR.Y

GLTALongs. Burn the shorts. 9:46AM ET on Monday Dec 20,

[Mrlongpants]

 

9:46AM ET on Monday Dec 20, 2021 by MT Newswires

 

09:46 AM EST, 12/20/2021 (MT Newswires) -- Middlefield Group, on behalf E Split Corp. (ENS.TO) said Monday that it has raised about $63 million via the completion of an overnight offering of class A and preferred shares.

The company's stock dropped 3% on last look on Monday.

The class A shares and preferred shares will trade on the Toronto Stock Exchange under the existing symbols ENS and ENS.PR.A.

The class A shares were offered at $15 apiece to yield 10.4% and the preferred shares were offered at $10.15 apiece to yield 5.2%.

E Split invests in common shares of Enbridge Inc. (ENB.TO), a North American oil and gas pipeline, gas processing, and natural gas distribution company.

Price: 13.54, Change: -0.43, Percent Change: -3.08

9:46AM ET on Monday Dec 20, 2021 by MT Newswires

 

09:46 AM EST, 12/20/2021 (MT Newswires) -- Middlefield Group, on behalf E Split Corp. (ENS.TO) said Monday that it has raised about $63 million via the completion of an overnight offering of class A and preferred shares.

The company's stock dropped 3% on last look on Monday.

The class A shares and preferred shares will trade on the Toronto Stock Exchange under the existing symbols ENS and ENS.PR.A.

The class A shares were offered at $15 apiece to yield 10.4% and the preferred shares were offered at $10.15 apiece to yield 5.2%.

E Split invests in common shares of Enbridge Inc. (ENB.TO), a North American oil and gas pipeline, gas processing, and natural gas distribution company.

Price: 13.54, Change: -0.43, Percent Change: -3.08

[autofocus111]

I'll bite... How does a company that invests solely in ENB common shares have a higher yield than the underlying ENB shares? Does it issue debt or shares to cover the shortfall? What wonderful magic... not. >>>The class A shares were offered at $15 apiece to yield 10.4%...E Split invests in common shares of Enbridge Inc. (ENB.TO)

[corvette67]

If they are issued equally, in effect they can steal the %2.5 from the preferred. GLTA

[TickerTwit]

I don't recall the details of ENS, but I can describe the general structure of a split fund. (1) Preferred shares and common shares are issued in pairs. You do not need to own both sides of a pair, and you can trade either member of a unit independently. (2) The preferreds have first claim on dividends and first claim on net asset value (NAV) if the fund is dissolved. But both of these

[autofocus111]

@TT Thanks for the explanation. If I understand it correctly, the 'higher' dividend paid to common shareholders of the fund relies on an increasing ENB share price (and therefore higher fund NAV) and the leverage of the common shares to that rising NAV. And likewise downside for a dropping share price. Hard to see what the advantage of this 'accelerated capital gains/losses'

[TickerTwit]

I think there are chiefly two types of investors attracted to them: (1) impulsive yield-seekers who don't fully understand the split funds, and (2) opportunists who spot a badly-beaten fund they think has the right kind of underlying stocks for full recovery. There are disaster scenarios where a large gain can be made in a short period of time on certain split funds. My son and I got a double