The GDL Fund Successfully Completes Offering and Issues $131 Million of Series C Preferred Shares
March 26 2018 - 9:03AM
Business Wire
The GDL Fund (NYSE:GDL) (the “Fund”) is pleased to announce the
completion of a rights offering (the “Offering”) in which the Fund
issued 2,624,025 Series C Cumulative Puttable and Callable
Preferred Shares (the "Series C Preferred"), totaling $131,201,250.
Pursuant to the Offering, the Fund issued one non-transferable
right (a “Right”) for each outstanding Series B Cumulative Puttable
and Callable Preferred Share (the "Series B Preferred") of the Fund
to Series B Preferred shareholders of record as of February 14,
2018. Holders of Rights were entitled to purchase the Series C
Preferred with any combination of cash or surrender of the Series B
Preferred at liquidation preference. Therefore, one Right plus
$50.00, or one Right plus one share of Series B Preferred with a
liquidation value of $50.00 per share, was required to purchase
each share of the Series C Preferred. The Offering expired at 5:00
PM Eastern Time on March 20, 2018.
The Offering was over-subscribed. The Fund received
subscriptions (including over-subscription requests and notices of
guaranteed delivery) for over 3 million Series C Preferred shares,
totaling approximately $153 million. Approximately 82% of the
Series C Preferred shares were subscribed for in the primary
subscription. Pursuant to the Offering, the remaining 18% of the
Series C Preferred shares were allocated according to the terms of
the over-subscription privilege. Approximately 1.72 million Series
B Preferred shares with a liquidation value of $50.00 per share, or
approximately $86 million, were surrendered by subscribing
shareholders to acquire Series C Preferred shares. The surrendered
Series B Preferred shares were retired.
All of the Series C Preferred shares subscribed for in the
primary subscription and allocated according to the terms of the
over-subscription privilege were issued on March 26, 2018.
As previously announced, the proceeds raised in the Offering
will be used to redeem the remaining outstanding Series B Preferred
shares.
The Series C Preferred will pay distributions quarterly at an
annualized dividend rate of 4.00% of the $50.00 per share
liquidation preference of the Series C Preferred for the quarterly
dividend periods ending on or prior to March 26, 2019 (“Year 1”).
At least 30 days prior to the end of Year 1, the Fund’s Board of
Trustees will determine and publicly announce a reset fixed
dividend rate that will apply for the next eight quarterly dividend
periods (“Year 2” and “Year 3”). At least 30 days prior to the end
of Year 3, the Fund’s Board of Trustees will determine and publicly
announce a reset fixed dividend rate that will apply for all
remaining quarterly dividend periods prior to the mandatory
redemption date for the Series C Preferred of March 26, 2025. Each
reset dividend rate will be determined by the Fund’s Board of
Trustees or a committee thereof in its sole discretion, and such
rate will be not less than an annualized rate of 4.00% and not
greater than an annualized rate of 6.00%.
The Series C Preferred may be put back to the Fund during the
30-day period prior to March 26, 2020 and March 26, 2022 at the
liquidation preference of $50.00 per share, plus any accumulated
and unpaid dividends, and redeemed by the Fund, at its option, at
the liquidation preference of $50.00 per share, plus any
accumulated and unpaid dividends, on March 26, 2021 or March 26,
2023.
The Fund has submitted an application to list the Series C
Preferred on the New York Stock Exchange (the “NYSE"). The Series C
Preferred are expected to commence trading on the NYSE shortly
after the date of issuance.
We thank all our subscribing shareholders as well as the full
service brokers and financial advisers who assisted our
shareholders throughout the Offering.
The GDL Fund is a diversified, closed-end management investment
company with $328 million in total net assets whose investment
objective is to achieve absolute returns in various market
conditions without excessive risk of capital. The Fund is managed
by Gabelli Funds, LLC, a subsidiary of GAMCO Investors, Inc.
(NYSE:GBL).
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version on businesswire.com: https://www.businesswire.com/news/home/20180326005609/en/
For The GDL FundPeter Baldino, 914-921-5070
GDL (NYSE:GDL)
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