Chelverton UK Dividend Trust Announces Refinancing of 2025 ZDP Shares
Why we think this is neutral
The RNS announcement outlines the company's plans to refinance the existing 2025 Zero Dividend Preference Shares, which appear to be a prudent and well-structured move. However, the lack of financial details and broader context makes it difficult to fully assess the overall impact on the company. Without any major red flags or concerning information, the sentiment is considered neutral.
Key Points
- The Company is finalizing proposals to refinance the existing 2025 Zero Dividend Preference Shares (2025 ZDPs)
- A new wholly owned subsidiary ("2031 ZDPCo") will issue up to 15 million new ZDP shares with a 5.75 year term and 7.50% gross redemption yield
- The new ZDP issue will be made via a scheme of reconstruction and voluntary winding up of the existing 2025 ZDPCo, offering holders the option to roll over their existing holdings
- Any remaining new ZDP shares will be placed
- The Company also intends to put in place an ordinary share placing programme of up to 8 million shares
Summary
Chelverton UK Dividend Trust PLC (the "Company") has announced plans to refinance its existing 2025 Zero Dividend Preference Shares ("2025 ZDPs"), which are due for repayment on 30 April 2025. The Company has incorporated a new wholly owned subsidiary ("2031 ZDPCo") to issue up to 15 million new ZDP shares with a 5.75 year term and 7.50% gross redemption yield. This new ZDP issue would be made via a scheme of reconstruction and voluntary winding up of the existing 2025 ZDPCo, offering holders the option to roll over their existing holdings. Any remaining new ZDP shares would be placed. The Company also intends to put in place an ordinary share placing programme of up to 8 million shares.