Q: Good afternoon,
Very curious on your thoughts regarding Alaris' latest investment. Mostly preferreds at high rates, and some common. Sounds like a Berkshire-type of deal, with the preferreds playing such a large role. Seems out of the ordinary for them -- from my limited knowledge -- and does it de-risk the units somewhat, or add to the risk.
Thank you as always
Very curious on your thoughts regarding Alaris' latest investment. Mostly preferreds at high rates, and some common. Sounds like a Berkshire-type of deal, with the preferreds playing such a large role. Seems out of the ordinary for them -- from my limited knowledge -- and does it de-risk the units somewhat, or add to the risk.
Thank you as always
5i Research Answer:
We have comments posted on the quarter; AD's investment in Optimus looks fine. It has used preferreds before, but AD had made it first Canadian investment in six years. The preferreds add 'a bit' of protection, but typically are done so owners are not diluted by straight equity, and the company can buy back the preferreds, if desired. We think it is a decent deal for the company, and three brokers have upgraded the stock this week after earnings.