Extendicare starts normal course issuer bid for some convertibles

By Susanna Moon

Chicago, Jan. 5 - Extendicare Real Estate Investment Trust said it received approval from the Toronto Stock Exchange to begin a normal course issuer bid for up to 6.85 million of its trust units, C$11.39 million principal amount of its 5.7% convertible unsecured subordinated debentures due June 30, 2014 and C$9.18 million principal amount of its 7.25% convertible unsecured subordinated debentures due June 30, 2013.

The securities represent, in each case, about 10% of the public float of the outstanding amount on Dec. 31.

Purchases under the bid will begin on Jan. 7 and end on Jan. 6, 2011 or earlier.

Under the exchange's block purchase exception, purchases on any trading day will not exceed 47,243 REIT units, C$36,700 principal amount of 5.7% debentures and C$24,100 principal amount of 7.25% debentures, according to a press release.

The purchase price will be the market price at the time of purchase, and any purchased securities will be canceled.

Extendicare said it has made purchases of 880,500 units at a weighted average price of C$6.01 each, C$1.07 million of 5.7% debentures at C$69.27 per C$100 and C$198,000 of 7.25% debentures at C$80.04 per C$100 under a previous normal course issuer bid, which expired on Dec. 28.

The REIT said its board of trustees "authorized the bid because it believes that it is an attractive and appropriate use of the REIT's available funds to purchase REIT securities when the market prices of such securities do not fully reflect their underlying value."

Extendicare is a Markham, Ont.-based provider of long-term care and related services.

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