GDL Fund issues new Series G Preferred Shares

The GDL Fund (NYSE:GDL), currently trading at $8.26 with a market capitalization of $5.69 million, has recently expanded its equity through the issuance of new Series G Cumulative Preferred Shares, according to a filing with the Securities and Exchange Commission (SEC). InvestingPro data shows the fund has delivered an impressive 11.98% return over the past year. The unregistered sale of these equity securities was executed in two separate transactions to qualified purchasers, under an exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933.

On March 26, 2025, the Fund issued 255,000 Series G Preferred Shares at a liquidation preference of $10.00 per share, resulting in net proceeds of approximately $2.5 million. A subsequent offering on March 31, 2025, saw an additional 40,000 shares sold at the same liquidation preference plus accrued dividends, garnering around $380,000 in net proceeds.

Following these transactions, the Fund reported a total of 295,000 Series G Preferred Shares outstanding, with the capacity to issue up to 3,205,000 more shares under the established Series G Statement of Preferences.

The Series G Preferred Shares carry a dividend rate of 5.20% per annum, with dividends accumulating from the date of issue. This adds to the fund’s existing attractive dividend profile, with InvestingPro data showing the current dividend yield at 5.82% and regular dividend payments of $0.48 per share. These shares are non-assessable, fully paid, and do not offer preemptive, exchange, or conversion rights. The Fund’s Board of Trustees retains the ability to reclassify any unissued Series G Preferred Shares by altering their rights and preferences.

In terms of voting rights, the holders of Series G Preferred Shares are entitled to vote on amendments that materially and adversely affect their rights and preferences. Any such changes would require the affirmative vote of the majority of the Fund’s preferred shares outstanding, voting as a single class.

The adoption of the Series G Statement of Preferences took place on March 18, 2025, authorizing the issuance of up to 3,500,000 Series G Preferred Shares with a liquidation preference of $10.00 per share.

This financial activity is part of the Fund’s broader strategy to manage its capital structure and provide liquidity options. According to InvestingPro analysis, the Fund maintains a "GOOD" financial health score of 2.82, suggesting strong financial management. The detailed terms and conditions of the Series G Preferred Shares are outlined in the Series G Statement of Preferences, which was included as an exhibit in the SEC filing. For investors seeking comprehensive analysis of GDL’s financial metrics and growth potential, InvestingPro offers additional valuable insights and detailed financial health indicators.

The information disclosed in this article is based on the SEC filing by the GDL Fund.

In other recent news, the GDL Fund has announced an extension of the mandatory redemption date for its Series E Cumulative Term Preferred Shares. Originally scheduled for March 26, 2025, the redemption date has now been moved to June 26, 2026. This amendment also introduces an optional put for shareholders on December 26, 2025, and a mandatory put on March 26, 2025. Shareholders opting to have their shares purchased on the mandatory put date do not need to take any action, while those choosing to keep their shares can opt out of the mandatory put. The changes, filed as Amendment No. 2 to the Statement of Preferences, aim to provide shareholders with more flexibility in their investment decisions. The GDL Fund has not provided specific reasons for these changes in the redemption and put dates. This information was disclosed in a press release statement accompanying the SEC filing, with full details available in Exhibit 3.1 of the SEC Form 8-K filed by the GDL Fund.

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