Scottish Re Group Ltd Perp Pfd (SKRUF)

[bwana12]

Liquidation: Occurs when a firm's business is terminated. Assets are sold, proceeds are used to pay creditors, and any leftovers are distributed to shareholders.


So, under a Change of Control scenario, the company would owe them $800 million. To pay them, the company would have to liquidate their assets (i.e. the shares of the subsidiary companies), as they would otherwise NOT have $800 million to pay. The liquidation then triggers the preferential treatment of the preferreds.

That is the way I see it.