Canaccord Capital Inc. (TSX:CCI) has agreed to repurchase, at par value, up to $138 million worth of restructured third-party asset backed commercial paper (ABCP) from clients who hold $1 million or less.
According to the company, the relief program affects up to 1,430, or 97% of Canaccord clients who have investments in ABCPs.
"Clients will remain entitled to receive any unpaid interest to the extent it is payable pursuant to the restructuring plan, and Canaccord will reimburse the share of the overall restructuring costs borne by our eligible clients," said Canaccord Capital COO Mark Maybank. "We worked hard to secure this deal and have contributed our capital to it. With a tangible restructuring in place and a rally in global credit markets, we have been able to source and evaluate numerous bids from parties interested in purchasing the notes and choose the best outcome for clients."
The program is dependent on a successful restructuring of the third-party ABCP market and combines a market bid from third-party sources with a Canaccord-funded top-up to achieve par value.
Clients will also receive unpaid interest under the plan, and Canaccord will reimburse the eligible clients' share of the restructuring costs.
The restructuring plan is scheduled to close at the end of May.