Gabelli Dividend sees 96% participation in exchange for preferreds

By Wendy Van Sickle

Columbus, Ohio, April 16 – Gabelli Dividend & Income Trust competed its exchange offer for its series B auction market preferred shares, series C auction market preferred shares and series E auction rate preferred shares, according to a news release.

The offer began on March 17 and expired in April 14.

The fund said it received tenders for 96% of the outstanding auction rate preferred shares. It anticipates issuing 5,817 series J preferreds in exchange for the 6,106 auction rate preferred shares tendered and paying a total cash amount of $1,119,000 in lieu of issuing any fractional shares.

Through the offer, owners of the auction rate preferreds could exchange their shares at the exchange ratio of 0.96 of each newly issued series J preferred term share, liquidation preference of $25,000 per share, for each auction rate preferred share validly tendered.

In lieu of any fractional shares of series J preferreds, holders of auction rate preferreds will receive a cash amount, without interest, equal to 96% of the liquidation preference of any fractional shares remaining.

The series J preferreds will have a mandatory redemption date of March 26, 2028 and will pay dividends quarterly at an annualized rate of 1.7% for the first three years and 4.5% after that.

The series J preferreds are callable by the fund on March 26, 2024 at the liquidation preference plus dividends.

Gabelli is a Rye, N.Y.-based investment firm.

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