Virtus Investment calls some 8% convertible preferreds held by Harris

By Susanna Moon

Chicago, Aug. 2 - Virtus Investment Partners, Inc. said it called 9,783 shares of its outstanding series B convertible preferred stock as part of an effort to enhance its long-term capital position.

The convertible preferreds have an 8% cumulative dividend and are held by Harris Bankcorp Inc., a subsidiary of Bank of Montreal, under the terms of its $45 million investment in Virtus.

Under the investment agreement, Virtus may call 9,783 of the 45,000 outstanding preferreds at par plus any accrued dividends.

Harris, at its option, may convert the preferreds into about 375,000 shares of common stock, representing a conversion price of $26.10 per share.

The company's stock (Nasdaq: VRTS) closed at $25.80 on July 30.

Virtus said it also amended the terms of its $30 million credit facility to extend the maturity and provide more favorable interest rates and more flexible debt covenants.

"Our improved financial results over the past year gave us the opportunity to restructure and extend the credit facility and provided the financial flexibility to exercise our option to call a portion of the preferred shares," George R. Aylward, Virtus' president and chief executive officer, said in a press release.

The exercise of the call provision will reduce preferred dividend payments by $800,000 a year.

"These decisions will result in a lower-cost and more efficient capital structure, and give us the elements of a flexible, long-range capital management profile that is appropriate for a company of our size and in our industry," Aylward added.

Virtus provides investment management products and services and is based in Hartford, Conn.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.