Small specialty mREIT Sachem Capital (SACH) has re-opened their 7.75% notes due 2025.
The notes trade under ticker SCCC and can be seen here.
Originally the company had sold just 520,000 notes for gross proceeds of $13 million. The re-opening amount is yet to be determined.
The preliminary offering prospectus supplement can be seen here.
Hello
I bought SCCC October 10-October 15. I’ve been out since early December with illness. According to my info, SCCC was supposed to go X-div on 12/12 and pay on 12/15. However, no div has arrived in my account. Wrong info? What is the correct XD and PD for SCC. Many thanks for all that you do.
Jeff
Hey Jeff. I like the note myself and own it, but I dont like your source, as he/she/or it is wrong. We dont get paid until the end of the month.
The Notes will mature on September 30, 2025. The principal payable at maturity will be 100% of the aggregate outstanding principal amount. The interest rate of the Notes is 7.75% per year and will be paid every March 30, June 30, September 30, and December 30, beginning December 30, 2020, and the regular record dates for interest payments will be every March 15, June 15, September 15, and December 15, beginning December 15, 2020. If an interest payment date falls on a non-business day, the applicable interest payment will be made on the next business day and no additional interest will accrue as a result of such delayed payment. The initial interest period will be the period from and including September 4, 2020, to, but excluding December 30, 2020
Any explanation why SCCC is down ans SCCB is up?
Still dumping the newly issued shares?
Looks like the re-opening amount will be another small offering as BusinessWire is reporting this second offering will be about $14 million, with an additional $2 million for over-allotments, if any.
Curiously, Barrons had a recent piece on mreits and they selected Agency (AGNC), Dynex (DX) and New Res (NRZ) as their favorites. Sachem, being so small, didn’t show.
Bought at 24.82. SCCB isn’t falling this looks like an outlying price because of the new offering. 1/3rd sold already.
Martin, I got in here also. I dont like these types of companies, but the “nasty” trading stuff has been where the action has been lately for me trading wise. Even bought a couple days ago dog with fleas PBI-B and its up about a buck already.
I am in on SCCC as well Grid. Have to grab opportunity when it knocks
Also bought some LANDO on the dump a few days ago and then paired both with some OPPRP and UEPEP (the latter two in my taxable account where I had some cash building up earning minimal so 4 1/2% or so is better than nothing, the first two in my IRA where I had to sell a few things to jump on these and can afford to take on more risk)
Maverick, These types of trades usually pay off when the sisters are snoozing from reissue sell off. Also remember this issue will have an additional one time increased payment stub from first payment being longer time period than the normal going forward 3 month cycle. Im assuming these may bang that out also with the existing shares, but I cant determine that, as the material I read was too general to state either way.
Grid – Is it possible to pay a split div? Could anybody (SACH, SEC, brokers et al) even determine who has the short-period shares?
Dart, I doubt it, I just stated it that way because I have no experience there. I do remember cheap arse Steel Partners issuing a secondary of their SPLP-A to a separate group of investors of a buy out a couple years ago. They had to temporarily issue it SPLP-T for a month or so, so they wouldnt have to pay full divi. After they both went exD, they folded SPLP-T into SPLP-A. Those two issues confused investors and I made a lot of great money trading back and forth between the two.
Grid, nice work on PBI-B. I wish I had a bigger position there. I think Q4 will be very good to their package shipping business which will enable the company’s turnaround. Fedex and UPS just said package volume will be so high they expect delays and backlogs for shipping in Q4.
Landlord, Im like you and keeping it small. I have developed a habit of enjoying eating 3 meals a day and dont want to put PBI in a position to interfere with putting food on the table, ha.
But seriously like you the thesis of their small but growing internet service will keep the bond ghouls away from the issue.
Grid, their ecommerce business is small (actually negative) in profits but pretty significant in revenue. The question is whether they can drive margins higher. Their recent price increase should help with that.
Can anyone comment on where this fits in the relative safety chart? SACH has a market cap under 100 million, so even in the highly uncertain mREIT universe, this would seem to be on the lower end of that.
With the price decline this morning I took the opportunity to establish a position below par which will yield 7.8% for 5 years. I’ll take it.
It’s not even 6:30 AM Eastern… when do you sleep?
Dartboard–I wrote this last night around 10:30 and set it up to publish at 5:30 am–so I do sleep on occasion.
HA! You clever devil!
Tim, thanks for your astute and always the first to notice this opportunity. SCCC issuer is kind of like an opportunistic small time brokerage house. Fidelity analysts are bullish on the common. I tried to sell COWNZ from my retirement account in Vanguard brokerage, my bid to sell did not appear in Fidelity.com or Schwab.com. I sold my remaining 150 shares of AUBAP and quickly replaced it SCCC @ $24.88. There seems to have some signs of inflation. So, pair trades makes sense to me, e.g. OPPRP coupled with JPMNL. Bought some JPMNZ following the SA writer who co authored with Rida Morwa (if I recall correctly). This Preferred XXXX got some praise by Gridbird as I recall. JMP is another small time brokerage with no existential threat at this time. Thanks to Gridbird, I have FPI-B and WCC-A. BTW, I have zero concern with WFC preferreds. The new one still got 2 notch above IG by Moody. Split rating. I have lots of WFC-Y. So far, no price erosion. Apparently there was shorting in March when EVERYTHING except the illiquid issues by Gridbird, presumably that the COVID 19 was leaked out to some big firms with lots of positions. BTW, I should mention that I made the mistake of selling BPYU and BPY, Brookfield eREIT common. It enjoyed 2 day nice climb. Apparently, the market believes in more Brookfield than the ancient KIM (KIMCO Realty) when both have significant Mall exposure.