Citadel Premium Income Fund

Citadel Premium Income Fund

October 12, 2007 17:05 ET

Citadel Premium Income Fund Notice of Rights Offering

CALGARY, ALBERTA--(Marketwire - Oct. 12, 2007) - Citadel Premium Income Fund (TSX:CPF.UN) (the "Trust") announces that it is issuing Rights to subscribe for trust units to holders of its trust units of record at the close of business on October 23, 2007. Each holder of trust units is entitled to one Right for each trust unit held on the record date. Four Rights will entitle the holder to purchase one trust unit of the Trust at a price of $9.50 per trust unit until 4:00 p.m. local time at the place of exercise on November 20, 2007. The subscription price of $9.50 per trust unit represents a discount to the Trust's net asset value of $11.01 per trust unit on October 10, 2007 of 13.7%.

The reason for the offering is to provide the Trust with additional capital that can be used to capitalize on certain attractive investment opportunities that the Trust's Investment Manager has identified and foresees arising over the next few months. The Investment Manager has identified a number of attractive investment opportunities which it is restrained from pursuing with the Trust currently being 21.5% leveraged. By raising additional cash through this offering, the Investment Manager will be able to continue pursuing investment opportunities that it considers attractive, while allowing the Trust to become less leveraged in the short term.

If all of the Rights are exercised, the Trust will issue 9,468,337 trust units and receive net proceeds of approximately $89.7 million. The Toronto Stock Exchange has approved the listing of the Rights which are expected to commence trading on October 19, 2007 under the symbol of CPF.RT.

TD Securities Inc. will act as dealer manager to form a facilitating dealer group to solicit subscriptions for the clients.

Contact Information

  • Citadel Premium Income Fund
    Joe MacDonald
    Executive Vice President, Sales and Marketing