12:13 PM EDT, 06/20/2024 (MT Newswires) -- Chemtrade Logistics Income Fund (CHE-UN.TO) said Thursday that it will launch a substantial issuer bid for all of its issued and outstanding 8.50% convertible unsecured subordinated debentures due Sept. 30, 2025.

As of June 19, Chemtrade said nearly $86 million principal amount of debentures were issued and outstanding.

The purchase price under the offer is $1,300 in cash per $1,000 principal amount of debentures, representing a premium of $3.92 per $100 principal amount of debentures and an approximate 3.1% premium to the debentures' 30-day volume-weighted average price on the TSX

"The board's decision to offer to purchase the debentures at a premium is consistent with our strategy of optimizing our capital structure," chief financial officer Rohit Bhardwaj said. "Since the debentures are well in-the-money, we are aiming to avoid conversions that may dilute our unitholders, as Chemtrade believes its units remain undervalued."

The offer will expire July 31.

Chemtrade units were last seen up $0.43 to $9.31 on the Toronto Stock Exchange.

Price: 9.31, Change: +0.43, Percent Change: +4.84