Closed end fund Gabelli Multimedia Trust (GGT) has priced their previously announced cumulative perpetual preferred stock.
The coupon is fixed at 5.125%, which is about as expected for a likely strongly investment grade preferred. The company anticipates a A2 rating from Moodys, but thus far we do not see a Moodys rating on their website.
Being a closed end fund the company must maintain a asset coverage ratio of 200% or more and most recently GGT has a coverage of 382% (as of 6/2019).
The issue will trade immediately on the OTC Grey Market under temporary ticker GABGP–in fact I see a few shares have crossed around $25.03 today.
The pricing term sheet is here.
Trading range today 25.10 – $25.40. currently 25.35
GAB-K at a 5% coupon is currently trading at $25.15. The 52 week high for this issue is $25.35.
GABGP at a 5.125% coupon is currently trading at $25.40. In two weeks will this be the 52 high for 2019?
No way, am I interested in this issue unless it’s around GAB-K and then only for a flip
GAB-G is also a 5% coupon trading between 25.05-25.13 today.
GABGP came back to earth today, closing at $25.15.
Doesn’t look like a big flip opportunity given how other new GAB issues are trading.
I will hold on buying. I still think 10 year moves back to 2% – 2.25% and that raises the coupon of the future new preferreds