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Aim.to (Aeroplan)

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  • Nov 13th, 2017 3:38 pm
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May 30, 2005
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jerryhung wrote:
May 11th, 2017 4:51 pm
Another RFD thread for stocks that tanked 60% - HCG and now AIM

Whole thing is just crazy, spin off FFP and then kill it
AC may as well buy back AIM for cheap now
AIM has a market cap of $507M based on today's closing price.

Based on limited information I can find, Air Canada initially spun off 12.5% in an IPO for $250M in 2005, sold some stocks for $357M in April 2008, and sold the remaining shares for $434M in 2008.

I'm not sure if that's all the sales, but my point is, they sold their interest in the company over the years for far more than they would need to pay to buy it out at today's price.

Good point indeed.
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What are your thoughts on Aimia preffered shares, A, B, and C (They dropped hard then got bought up quickly)
Thinking of the C series.
AIM.PR.C. Currently, they pay a 12.7% dividend.

These are rate-reset preferred shares, which means the payout to investors will reset every five years to a yield which equals the Government of Canada five-year bond yield plus 4.2%. This means investors will only enjoy the current payout until 2019. Then it drops down to 8.7%, which is still a very attractive dividend.

Holders of the Series 3 Preferred Shares will be entitled to receive a cumulative quarterly fixed dividend yielding 6.25% annually for the initial five-year period ending March 31, 2019. The dividend rate will be reset on March 31, 2019 and every five years thereafter at a rate equal to the 5-year Government of Canada bond yield plus 4.20%. The Series 3 Preferred Shares will be redeemable by Aimia on March 31, 2019, and every five years thereafter in accordance with their terms. Holders of Series 3 Preferred Shares will have the right, at their option, to convert their shares into Cumulative Floating Rate Preferred Shares, Series 4 (the “Series 4 Preferred Shares”), subject to certain conditions, on March 31, 2019 and on March 31 every five years thereafter. Holders of the Series 4 Preferred Shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada Treasury Bill yield plus 4.20%.

Meaning that Aimia can eventually redeem the shares and owe everyone $25 per share, correct? for shares currently trading at $12.31

MONTREAL, May 10, 2017 /CNW Telbec/ - Aimia (TSX: AIM) announced today that the Board of Directors has declared a quarterly dividend of $0.20 per common share, payable on June 30, 2017 to shareholders of record at the close of business on June 16, 2017.

The Board has also declared a quarterly dividend in the amount of $0.28125 per Cumulative Rate Reset Preferred Share, Series 1, a quarterly dividend in the amount of $0.263651 per Cumulative Rate Reset Preferred Share, Series 2, and a quarterly dividend of $0.390625 per Cumulative Rate Reset Preferred Share, Series 3, in each case payable on June 30, 2017 to the holders of record at the close of business on June 16, 2017.

Dividends paid by Aimia to Canadian residents on both its common and preferred shares are "eligible dividends" for Canadian income tax purposes.
Last edited by zobi123 on May 11th, 2017 7:59 pm, edited 3 times in total.
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May 25, 2008
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zobi123 wrote:
May 11th, 2017 7:59 pm
What are your thoughts on Aimia preffered shares, A, B, and C (They dropped hard then got bought up quickly)
Thinking of the C series.
AIM.PR.C. Currently, they pay a 12.7% dividend.

These are rate-reset preferred shares, which means the payout to investors will reset every five years to a yield which equals the Government of Canada five-year bond yield plus 4.2%. This means investors will only enjoy the current payout until 2019. Then it drops down to 8.7%, which is still a very attractive dividend.

Holders of the Series 3 Preferred Shares will be entitled to receive a cumulative quarterly fixed dividend yielding 6.25% annually for the initial five-year period ending March 31, 2019. The dividend rate will be reset on March 31, 2019 and every five years thereafter at a rate equal to the 5-year Government of Canada bond yield plus 4.20%. The Series 3 Preferred Shares will be redeemable by Aimia on March 31, 2019, and every five years thereafter in accordance with their terms. Holders of Series 3 Preferred Shares will have the right, at their option, to convert their shares into Cumulative Floating Rate Preferred Shares, Series 4 (the “Series 4 Preferred Shares”), subject to certain conditions, on March 31, 2019 and on March 31 every five years thereafter. Holders of the Series 4 Preferred Shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada Treasury Bill yield plus 4.20%.

Meaning that Aimia can eventually redeem the shares and owe everyone $25 per share, correct? for shares currently trading at $12.31

MONTREAL, May 10, 2017 /CNW Telbec/ - Aimia (TSX: AIM) announced today that the Board of Directors has declared a quarterly dividend of $0.20 per common share, payable on June 30, 2017 to shareholders of record at the close of business on June 16, 2017.

The Board has also declared a quarterly dividend in the amount of $0.28125 per Cumulative Rate Reset Preferred Share, Series 1, a quarterly dividend in the amount of $0.263651 per Cumulative Rate Reset Preferred Share, Series 2, and a quarterly dividend of $0.390625 per Cumulative Rate Reset Preferred Share, Series 3, in each case payable on June 30, 2017 to the holders of record at the close of business on June 16, 2017.

Dividends paid by Aimia to Canadian residents on both its common and preferred shares are "eligible dividends" for Canadian income tax purposes.
The preferreds was, and still is, after the AC announcement, the safer way to play AIM. I have a large position in the B shares that is interconvertible with the A's every 5yrs, although in yesterday's debacle, the C shares dropped to $7.5 giving a 20% yield, and the best total return potential at that point. The preferreds represent a very small fraction of AIM's overall capital structure. It would not take much for them to buy them out by redemption @$25/share and they certainly have the cash flow (for now) to do so. They have been aggressively buying back the commons and will continue to so even after the AC announcement. They also announced an early redemption of the 2019 bonds. Although their has been no announcement on what they will do with the prefs, I see the possibility of shifting their deleveraging strategy to them.

There is of course alot of risk with this company - the AC contract was always an overhang to the stock price and I never had any intention of owning the commons because of it. At this point, I don't understand why they are still keeping the dividend on the common - they must be confident they can survive without AC and are moving ahead business as usual. BTW, AC represents only 10% of their revenue, but 75% of customer reward redemptions - so the announcement is significant. You can draw similarities between AIM and HCG in that customer confidence and loyalty means everything to their survival. Ultimately, AIM will have to find another partner, and in the meantime you have the opportunity to play a very high risk/reward situation.
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Thinking if I should buy now. It's up 10%. Might buy only $2000.
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Jon Lai wrote:
May 11th, 2017 7:11 pm
AIM has a market cap of $507M based on today's closing price.

Based on limited information I can find, Air Canada initially spun off 12.5% in an IPO for $250M in 2005, sold some stocks for $357M in April 2008, and sold the remaining shares for $434M in 2008.

I'm not sure if that's all the sales, but my point is, they sold their interest in the company over the years for far more than they would need to pay to buy it out at today's price.

Good point indeed.
AC also said they projected the value of the repatriation at 2 billion over 15 years. Oversimplifying but that's 133M per year of value AC is attributing to their own program. If we ballparked and said Aeroplan is getting that value for the next 3 years that is close to 400M ...plus all the other business Aimia has and that does make it seem cheap at these levels. Nevermind a possible resolution with AC or a new partnership to revitalize the Aeroplan program.

I initially set a limit buy order for 3.33 yesterday afternoon and FOMO caused me to adjust and buy slightly higher...but I'm quite happy with the bounce. Didn't want to dive right in first thing yesterday morning but did after digesting some numbers and scenarios.
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jerryhung wrote:
May 12th, 2017 9:50 am
bot 1000 @ $3.3 end of day
sold $3.7

quick $400 in 30 minutes work :) obviously tanking in HCG

Bought AC @ $16
Now HOD $3.99 +19.5% ($3.99 was my original SELL order, but lowered to $3.7 later)

I missed out $300 :( oh well, profit is profit
Now onto booking my Aeroplan flights
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Dec 2, 2014
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Over/Under on it breaking a dollar today? I have a bad habit of exiting positions too early.
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StarScream1337 wrote:
May 12th, 2017 10:26 am
Over/Under on it breaking a dollar today? I have a bad habit of exiting positions too early.
Up to 4.33?

Not looking like it.

I put in a stop as it rose to 4+ to protect myself and got stopped out @ 3.93. will check back later
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RolandCouch wrote:
May 12th, 2017 11:10 am
Up to 4.33?

Not looking like it.

I put in a stop as it rose to 4+ to protect myself and got stopped out @ 3.93. will check back later
I checked out at 20% and folded it into Enercare.
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StarScream1337 wrote:
May 12th, 2017 11:45 am
I checked out at 20% and folded it into Enercare.
Whats up with Enercare dropping 10%. It is usually a super stable low volatility stock.
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zobi123 wrote:
May 12th, 2017 9:26 pm
Whats up with Enercare dropping 10%. It is usually a super stable low volatility stock.
Earnings. Not surprised given the run it has had.

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