CEF (Closed End Fund) RiverNorth Opportunities Fund (RIV) has completed their previously announced common share rights offering.
RIV has a 6% perpetual preferred issue outstanding (RIV-A) which constitutes the funds ‘leverage’ on which they must have 200% asset coverage. The fund had adequate coverage as of 7/31/2022 (281% +/-), but we don’t know where they stand today. The preferred shares remain at A1 from Moody’s.
The company will be sellling 2.752 million shares to holders who exercised their right to purchase shares for gross proceeds of $32.9 million.
The company announcement is here.
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Take this off path: I was just researching ECC and EIC, and their preferreds. Did I read their fins right and they do have debt due until 2028? From their conf call: “no financing maturities prior to 2028. This protects us from any further rising rates and locks us into what we believe will be a very attractive cost of capital for many years to come.” Either the smoke feels good up the back side, or this mgt team has its act together. If their debt is locked in low, then they can really clean up with higher rates.
So what is the probability of the econ going off a 2009 cliff? This seems like the only thing that would uproot this company. And would the fed allow it any ways? If the econ does OK or good (mild recession to recovery, which is my bet), then this company prints $$, and some of their preferreds look really tasty. IMHO IG companies have good balance sheets and I don’t see the same fin recession as 2009.
What say you out there?