CLO owner Eagle Point Credit (NYSE:ECC) has called for early redemption of the 7.75% ECCA term preferred effective 6/28/2019. These shares have a mandatory redemption in 2022.
The company will redeem 909,000 shares of the $25 issue (we show the issue was a 1.6 million shares issue).
Share price is off 1% today as there was that much call risk in the issue, which we mentioned the other day here. Note that I own a modest position in the issue.
Shares to be redeemed will be determined by lottery among owner accounts per the company filing which can be seen here.
When one of these partial calls occur it tends to keep the share price on the remaining outstanding shares closer to $25 so one should be able to purchase shares a bit cheaper in the future–after the redemption. 7.75% is a tough one to replace and I may pick up shares if mine are redeemed.