What letter is that? I would think it would be a press release if anything, and I haven't seen that. Also, I'm a shareholder, and haven't seen any such letter. Can you provide any more information on this? Thanks.
There is news that IGR is redeeming some money borrowed, because the borrower needs liquidity, or something like that. They also talked about being able to borrow new money at much lower rate. Isn't that good news, and hence the pop?
Wasn't it a concern that IGR was overleveraging and bad in this environment? So what does this news mean concerning the leveraging which was the main reason why IGR has dropped so much?
Here's the news. Not a big deal as it is only 40 million, probably less depending if the auction is a fire sale.
NEW YORK & PHILADELPHIA--(BUSINESS WIRE)--The Board of Directors of ING Clarion Global Real Estate Income Fund (NYSE:IGR - News) and ING Clarion Real Estate Income Fund (NYSE:IIA - News) have approved the partial redemption of Adjustable Rate Preferred Securities (ARPS) in the amount of $200 million and $40 million respectively, which represents 22% and 33% respectively of the total ARPS outstanding for each fund. The redemption will be done as a pro rata repurchase of a portion of each ARPS Series at its next regular auction beginning April 1, 2008. The redemption will be funded with cash on hand and debt borrowings available under existing credit lines. The interest rate on the debt is equal to or less than the current rates on the ARPS. ADVERTISEMENT
The redemption of the ARPS was approved after deliberation of the Board and the investment manager, ING Clarion Real Estate Securities. The transactions will diversify the sources of leverage and lower costs for the funds. The transactions will also enhance the credit quality of the ARPS that remain outstanding consistent with the Funds’ commitment to maintain top credit ratings from Moody’s and Fitch. The redemptions will provide partial liquidity for the benefit of preferred shareholders who have experienced unwanted illiquidity as a result of recent unsuccessful auctions due to widespread problems in the debt markets.
We continue to work with banks, advisors and other industry participants to seek additional avenues for enhancing liquidity and reducing costs of leverage consistent with the investment objectives of the funds and considering the concerns and interest of all shareholders.
ING Clarion Real Estate Securities acts as the Funds’ investment advisor and is responsible for managing the Funds’ portfolio assets.