Preference shareholders are facing a painful loss as technology group Sdiptech redeems its preference shares at 105 kronor per share. This was noted by Affärsvärlden in a commentary on Thursday.
The industrial conglomerate Sdiptech announced over the weekend that its board had decided on the mandatory redemption of all preference shares. The redemption price will be 105 kronor, in accordance with the company's articles of association. A final dividend of 2 kronor per share will be paid in March before the redemption.
The most recent trading price for the preference share last Friday was 128.50 kronor, and the share is dropping sharply today. The preference share has been listed on the stock exchange since 2015 and has traded around 120-130 kronor in recent years, even though the redemption level has long been set at 105 kronor.
"The risk of redemption was something Affärsvärlden's Daniel Zetterberg warned about in a 2022 review of which preference shares investors should avoid," the newspaper writes.
It is common for preference and D-shares to trade well below their redemption prices, but there are a few exceptions. Volati's preference share can be redeemed for 625 kronor and is trading at 634 kronor. Navigo Invest's preference share stands at 128.5 kronor but can be redeemed for 115 kronor.
"What the odds of redemption are in these cases, we do not know," writes Affärsvärlden.
Sdiptech AB (publ) is a Sweden-based engineering company and provider of technical services and products for urban infrastructures, such as hospitals, traffic systems, water supply systems, and data centers. The Company divides its activities into two segments: Tailored Installations and Niched Products & Services. In the Tailored Installations segment the Company offers cooling installation services, wastewater treatment, solutions for electric automation, uninterruptible power supply solutions, roof maintenance and services within elevator industry, among others. The Company's Niched Products & Services include electrical power monitoring solutions, vibration monitoring services and measurement systems, water and district heating monitoring, decontamination services, radio infrastructure and traffic enforcement cameras, among others. The Company is active primarily in Northern Europe, with focus on Nordic countries and the United Kingdom.
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