Special Opportunities Fund, Inc. Provides Details on Redemption of Convertible Preferred Stock

Rhea-AI Summary

The Board of Directors of Special Opportunities Fund (NYSE: SPE) has announced the redemption of all outstanding shares of its Convertible Preferred Stock at $25 per share, effective at 5 pm EDT on July 9, 2021. Holders can convert their shares into Common Stock at a ratio of 1.9558 until the redemption date. As of June 30, 2021, the market price of the Convertible Preferred was approximately $29.50, significantly above the redemption price. The Fund has 11,806,970 shares of Common Stock outstanding, with a net asset value of $17.25 per share, and 524,171 shares of Convertible Preferred remaining.

Positive

• Convertible Preferred shares trading at $29.50, significantly above the $25 redemption price.
• Holders have the option to convert shares at a favorable ratio before redemption.

Negative

• Redemption could lead to reduced liquidity for Convertible Preferred shareholders.
• NAV of Common Stock ($17.25) is below the market price of Convertible Preferred, indicating potential undervaluation.

As previously announced, the Board of Directors (the “Board”) of Special Opportunities Fund, Inc. (NYSE: SPE) (the “Fund”), in accordance with the “Optional Redemption” provision of the prospectus for the Fund’s Convertible Preferred Stock (the “Convertible Preferred), has determined to redeem all shares of the Convertible Preferred that are still outstanding at 5 pm EDT on July 9, 2021 at $25 per share. Holders of the Convertible Preferred may, until 5 pm EDT on July 9, 2021, convert their shares into shares of Common Stock at a ratio of 1.9558 (with cash paid in lieu of any fractional shares of common stock). As of the time of this release, the market price of the Convertible Preferred is approximately $29.50 per share which is significantly higher than $25 per share. Therefore, holders of the Convertible Preferred are advised to check the market price of both the Common Stock and the Convertible Preferred before determining whether and when to convert their shares into Common Stock.

As of June 30, 2021, there are 11,806,970 shares of Common Stock outstanding and the net asset value (“NAV”) of the Common Stock is $17.25 per share. As of June 30, 2021, there are 524,171 shares of Convertible Preferred outstanding, all of which will be redeemed on July 9, 2021 if not previously converted.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210701005184/en/

FAQ

What is the redemption price for Special Opportunities Fund's Convertible Preferred Stock?

The redemption price is $25 per share.

When is the redemption date for the Convertible Preferred shares of SPE?

The redemption date is July 9, 2021 at 5 pm EDT.

What is the market price of the Convertible Preferred shares as of June 30, 2021?

The market price was approximately $29.50 per share.

What is the net asset value of Special Opportunities Fund's Common Stock?

The net asset value of the Common Stock is $17.25 per share.

How many shares of Convertible Preferred are outstanding before the redemption?

There are 524,171 shares of Convertible Preferred outstanding.