Henderson High Income investment trust's capital structure is to be restructured, resulting in the d...
Henderson High Income investment trust's capital structure is to be restructured, resulting in the dividend paid by the ordinary shares doubling to over 9%.
The trust, managed by Alex Crooke, is to exchange its existing ordinary shares for units consisting of one 50p zero dividend preference share and one ordinary share.
In September 2005 the zero is expected to repay investors 74.8p. It is estimated the ordinary shares will offer a yield of 9.3%, which should make them more attractive to investors. The trust's discount has been as wide as 21% over the past year. A large number of the existing ordinary shares on the trust are owned by retail investors
At the same time as exchanging the shares the bank borrowings on the trust are to be increased to 25%. This will allow the net assets of the trust to be fully invested in equities. Until now the portfolio has had an 86% weighting in equities with the balance consisting of fixed interest securities. The entire funds from the bank borrowings will be invested in fixed interest paper.
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