Morguard Real Estate Investment 5 25 convertible unsecured subordinated debentures T.MRT.DB.A

The heat is on!

[Shirtlessnomore]

Correct me if I'm wrong but now for December shorts will be responsible for the ex div of 2 cents a share on the 14th that just passed, then on the 30th it goes ex div again for 2 cents (as!they always pay January early and its bee announced) AND NOW they will have the new special dividend to also pay if they are still hanging around December 30th for another 11.5 cents a share, amounting to a whopping 15.5 cents per share in December. Ouch!

[Mrguillaume]

That is my understanding as well. Guess the shorts were on Santa's naughty list :-) The shorts better cover before Burquitlam Plaza is sold - that taxable capital gain alone will result in as much as a $1.25 / unit distribution ($150 million + cap. gain).

[Shirtlessnomore]

This will eventually make bank!

[incomedreamer11]

NO ,10 cents - only tax-obligation for long ( phantom distribution) , short doesn't pay it . For now they have pay only 2 cents regular and 1,5 cents special, total- 3,5 cents per share

[Mrguillaume]

But, when their short position is closed they need to purchase the addtional shares issued with the special dist of $0.10 in order to deliver to the lender the equivalent of a long. 

[incomedreamer11]

"Immediately following the special distribution, the outstanding units of the Trust will be consolidated such that each Unitholder will hold, after the consolidation, the same number of Units as such Unitholder held before the special distribution." Will be same number of outsdanding units , you can only increase your ACB Phantom distribution very unpopular for investors with non

[Mrguillaume]

Yes, you are correct. I didn't read the PR of the special dist.

[Slimax]

Shorts have to purchase the equivalent of the distribution of units.   That's why : Assuming someone has 10,000 units and the price is $ 5 (to make calculations easier) at December 31: He will receive 10,000x0.10 / 5 = 200 units, Then immediately there will be consolidation as 10,000: 10,200 Therefore Shorts must deliver around 2% x2.4M units (that they must purchase) otherwise

[Shirtlessnomore]

It really doesn't make sense that they would be responsible for nothing at all so this does seem more realistic.

[WEBuffettisbest]

That sounds right and I'm liking this. Although market is down big today as are most reits, I would have expedted more upside pressure. May take until after new year.

[HermannHaller]

I'm not sure about this. Maybe the shorts are liable for more shares after the special div, but then the stock is immediately consolidated. Since it happens simultaneously, I don't think a short is liable for anything additional. Similar situation with a stock split, it doesn't matter to the short seller. Please share if you get any 'official' answer from IR. thx.

[NotDrake]

I agree doesn't make sense that it would impact the shorts.  I think they might be able to claim a non-cash capital loss, which reduces their cost giving them a greater gain whenever they cover. The special div is a nothing-burger in my eyes.  A one-time distribution/tax obligation MRT is forced to pass onto investors because they didn't have enough to offset against it.  I

[WEBuffettisbest]

Slimax is correct. Using his example of 10,000 units, the shorter will have to purchase 200 units and give them to lender. This is because the lender lent out 10,000 shares and he will need to getr 200 units which are then consolidated to 10,000 units as before. The lender (and certainly his broker) knows he is entitled to his dividend, as does the buyer from the short seller. Mrt.un only has the

[Slimax]

Right.  You explained better than me. Thanks.  Excuse me guys for my English :) it's my third language. (And I live in Quebec. Not so much opportunities to practice :) Joyeux temps des ftes pour vous tous (juste les "longs" bien sr :) 

[slst]

Decent pick up in Volume and yet the price is lack lustre on a good day in the broader market. Seems like, sellers dont want the capital gains for 2021, and would rather sell now and buy back later.  Someone is buying, and likely short sellers are easing out before the HEAT. Expected the some special distribution would be necessary based on their results so far.  More like 20 cents

[Shirtlessnomore]

Thanks for the clarification understood. But they do get nailed for 5.5 cents total in about a one month span as ex div November 30th for 2 cents, ex div december 15th for 2 cents and the special for 1.5 cents December 31st. Cheers.

[flamingogold]

Looking back, this appears to be the case... a phantom distribution. No changes to my position YTD (no new buys or sells), same amount of shares owned but my average cost just increased by about 10¢