While it is strange to have a announced new issue late in the day we had one today as Eagle Point Income Company (EIC) announced they would be selling a new issue of term preferred stock.
The preliminary prospectus can be found here.
The issue will have a mandatory redemption date in 2028.
The issue will trade under ticker EICB when it begins to trade on the NYSE.
EIC already has a 5% term preferred outstanding and it can be seen here.
Yield talk is in the 7.75% area.
EIC should not be confused with Eagle Point Credit Company (ECC). Same manager, but different company.
Thanks to Larry Rodbard for picking up on this late day announcement.
Users who liked this:
Does anyone know if this has a temporary OTC symbol (and a good resource for finding these)?
Thx
@August ,
When you talk about the equity tranche of CLOs, aren’t you talking about the wildest of the wildest?
Anyone care to talk about what this might mean in the current environment?
Hi David,
To Tim’s point above, Eagle Point Income and Eagle Point Credit are two different funds and should not be confused at all.
Eagle Point Income invests mostly in debt (below investment grade typically) that has been issued by CLOs.
This preferred stock issue is for this fund.
Eagle Point Credit invests mostly in the equity tranche of CLOs. This preferred stock issue is not associated with this fund.
To your point, equity gets paid last and takes the first loss in CLOs.
The same management team operates both funds: Eagle Point Income & Eagle Point Credit.
Can any EICA holder say what the tax character of the distributions has been for the last couple of years? I can’t seem to find this on the EIC website.
It is in the prospectus, but generally I would plan on these being nonqualified dividends and taxable as ordinary income. Probably a good question for IR.
No, it’s not in the prospectus because it’s variable. I’m looking for an answer from an actual EICA holder.
As most will know – Eagle Point Income invests in below investment grade bond tranches issued by CLOs. Eagle Point Credit invests primarily in the equity tranche. I find this youtube video with a managing partner of Eagle Point Credit Management to be a good primmer on CLOs generally and particular the type of CLOs that Eagle Point invests in which exclusively use floating rate Sr bank loans as assets.
https://www.youtube.com/watch?v=OxivWs5vPTM