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National & World Ag News Headlines |
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CHS Issues Preferred Stock to Redeem $77 Million in Patron Equity
USAgNet - 04/04/2016
CHS Inc. announced the issuance, on March 31, of 2,693,195 shares of its Class B Cumulative Redeemable Preferred Stock, Series 1 (the "Class B Series 1 Preferred Stock") to redeem about $77 million of qualified CHS equity.
The amount of CHS qualified equity redeemed with each share of Class B Series 1 Preferred Stock was $28.50, equal to the closing price for one share of the Class B Series 1 Preferred Stock on March 23, 2016. The shares of Class B Series 1 Preferred
Stock were issued to 1,170 eligible member cooperatives and associations.
The Class B Series 1 Preferred Stock trades on the NASDAQ Global Select Market under the symbol CHSCO and has an annual dividend rate of 7.875 percent if, when and as declared by the CHS Board of Directors.
"This distribution allows CHS to deliver direct economic value to our owners by redeeming eligible qualified equity with shares of CHS preferred stock," said David Bielenberg, chairman, CHS Board of Directors.
Bielenberg said the special equity redemption with preferred stock is in keeping with the board's goals of providing an appropriate economic return to the cooperative's owners while maintaining a strong balance sheet and taking a long-term view in operating its
businesses on behalf of CHS owners.
To be eligible for the redemption, member cooperatives and associations must have been "active patrons" who held qualified capital equity certificates in an amount equal to or greater than $500. "Active patrons" are non-individual patrons who have done
business with CHS in the past five fiscal years.
A registration statement relating to the issued shares of Class B Series 1 Preferred Stock has been filed with the Securities and Exchange Commission and became effective on March 31. The specific terms of the issuance of the shares of Class B Series 1
Preferred Stock are described in a prospectus filed with the Securities and Exchange Commission in connection with the issuance. The offering of shares of Class B Series 1 Preferred Stock was made only by means of a written prospectus that forms a part of
the registration statement, copies of which may be obtained at the Securities and Exchange Commission's website at www.sec.gov or from CHS, Attention: Theresa Egan, Vice President, Accounting and Corporate Controller, 5500 Cenex Drive, Inver Grove
Heights, Minnesota 55077 or via telephone at (651) 355-6000.
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