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QR Energy, LP Common Units repr Message Board

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  • mobettafred mobettafred Apr 25, 2012 5:06 PM Flag

    Beware of convertible preferreds

    I think I understand your posts but maybe not since the stock is not doing too well in spite of it being the last day to get the distribution. Would you mind consolidating and dumbing them down a little in another message? Thanks.

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    • I think that because QRE is amoritizing the preferreds during the 3 low yeilding years there is going to be NO slowdown in the distributions afterwards because money is being set aside in advance for that. It took a lot of digging to find that and I could be misreading it. I pasted it all so you can refute it in case I'm wrong.

      After the 3 years are finished the preferreds will have the same distribution payouts as common shares. In order for the preferreds to be able to convert to common shares (and thus be saleable) the price of QRE needs to be trading at at least $21and change for over 30 days. In essence, Quantum needs QRE to do well and trade over $20 if it is ever going to be able to sell its preferred shares. Both partys interests are alligned. I see no problems just a very cheap MLP and that is not going to last.

      There are a lot of new MLPs and I had to do plenty of digging to find this. Others will follow esp after earnings on the 10th.