Costamare Inc. Announces Full Redemption of its Outstanding Shares of Series E Preferred Stock
On June 14, 2024, Costamare announced the redemption of all outstanding shares of its Series E Cumulative Redeemable Perpetual Preferred Stock, which carries an 8.875% dividend rate. The redemption will occur on July 15, 2024, at a price of $25.00 per share plus any accrued and unpaid dividends up to the redemption date. Currently, there are 4,574,100 outstanding shares of Series E Preferred Stock. After the redemption, these shares will no longer be outstanding, terminating all associated rights except the right to receive the redemption payment. The redemption will be managed through The Depository Trust Company and facilitated by Equiniti Trust Company,
- Redemption of 4,574,100 Series E Preferred Stock shares at $25.00 per share improves liquidity.
- Redemption includes accrued and unpaid dividends, ensuring fair treatment of shareholders.
- Removal of 8.875% dividend-paying shares may reduce future dividend obligations, potentially improving cash flow.
- The redemption of high-dividend shares may indicate cash outflow, impacting immediate liquidity.
- Investors holding Series E Preferred Stock lose a high-yield investment option.
Insights
Costamare Inc. (NYSE: CMRE) has announced the full redemption of its 8.875% Series E Cumulative Redeemable Perpetual Preferred Stock, affecting approximately 4,574,100 outstanding shares. The redemption price per share is set at $25.00, plus accrued and unpaid dividends up to the redemption date of July 15, 2024. This move results in a cash outlay of approximately
The decision to redeem these shares can be viewed from several angles. First, it reduces the company's obligations to make fixed dividend payments on these preferred stocks, potentially improving its cash flow profile. However, it also involves a significant immediate cash expenditure, which could impact liquidity if not well-managed.
For retail investors, it is imperative to understand that preferred stockholders will receive their invested capital back along with any dividends accrued. This is generally a positive signal, indicating that the company is in a strong enough cash position to redeem all preferred shares at once. However, the cash outflow might be perceived negatively by common shareholders if it strains the company's finances. Additionally, the elimination of the Series E dividends could provide more flexibility for potential common dividends or reinvestment opportunities in the future.
From a market perspective, the redemption of Costamare Inc.'s Series E Preferred Stock can signify multiple strategic intentions. The company may be positioning itself for more flexible financial structuring, possibly preparing for future investments or acquisitions without the constraint of fixed dividend payments.
The redemption may also showcase Costamare's confidence in its future cash flow, as handling a
In the shipping industry, fleet expansion, upgrades and maintenance are capital-intensive. The decision to prioritize redeeming preferred shares over such investments may warrant scrutiny from long-term investors. Still, for the short term, eliminating the preferred dividends could lead to a more flexible balance sheet, potentially leading to strategic advantages.
MONACO , June 14, 2024 (GLOBE NEWSWIRE) -- Costamare Inc. (the “Company”, “we” or “our”) (NYSE: CMRE) announced today that the Company will redeem all of its outstanding shares of
Upon the Redemption, no shares of Series E Preferred Stock will remain outstanding, and all rights with respect to such stock will cease and terminate other than the right to receive payment of the Redemption Price. The information contained in this Press Release does not constitute a notice of redemption with respect to the shares of Series E Preferred Stock.
The shares of Series E Preferred Stock are held through The Depository Trust Company (“DTC”) and will be redeemed in accordance with the procedures of DTC. Payment to DTC for the shares of Series E Preferred Stock will be made by Equiniti Trust Company, LLC, the Company’s redemption agent (the “Redemption Agent”), in accordance with the terms set forth in the Redemption Agent Agreement that governs the redemption of the shares of Series E Preferred Stock. All questions about the notice of redemption and related materials should be directed to the Redemption Agent at the following address and phone number:
Equiniti Trust Company, LLC
Attention: Reorganization Department
55 Challenger Road, Suite 200
Ridgefield Park, New Jersey 07660
Tel: (718) 921-8317
About Costamare Inc.
Costamare Inc. is one of the world’s leading owners and providers of containerships and dry bulk vessels for charter. The Company has 50 years of history in the international shipping industry and a fleet of 68 containerships, with a total capacity of approximately 513,000 TEU and 39 dry bulk vessels with a total capacity of approximately 2,900,000 DWT (including one vessel that we have agreed to sell and two vessels we have agreed to acquire). The Company also has a dry bulk operating platform which charters in/out dry bulk vessels, enters into contracts of affreightment, forward freight agreements and may also utilize hedging solutions. The Company participates in a leasing business that provides financing to third-party owners. The Company’s common stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock and Series E Preferred Stock trade on the New York Stock Exchange under the symbols “CMRE”, “CMRE PR B”, “CMRE PR C”, “CMRE PR D” and “CMRE PR E”, respectively.
Forward-Looking Statements
This press release contains “forward-looking statements”. In some cases, you can identify these statements by forward-looking words such as “believe”, “intend”, “anticipate”, “estimate”, “project”, “forecast”, “plan”, “potential”, “may”, “should”, “could” and “expect” and similar expressions. These statements are not historical facts but instead represent only the Company’s belief regarding future results, many of which, by their nature, are inherently uncertain and outside of the Company’s control. It is possible that actual results may differ, possibly materially, from those anticipated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect future results, see the discussion in the Company’s Annual Report on Form 20-F (File No. 001-34934) under the caption “Risk Factors”.
Company Contacts:
Gregory Zikos - Chief Financial Officer
Konstantinos Tsakalidis - Business Development, Investor Relations
Costamare Inc., Monaco
Tel: (+377) 93 25 09 40
Email: ir@costamare.com
FAQ
What is the redemption date for Costamare's Series E Preferred Stock?
What is the redemption price for Costamare's Series E Preferred Stock?
How many shares of Series E Preferred Stock are being redeemed by Costamare?
What will happen to the rights associated with Series E Preferred Stock after redemption?
Which company is handling the redemption of Costamare's Series E Preferred Stock?
