Shareholders of DHT Holdings, Inc. (DHT) have received generous dividends during the past two quarters. The expectation is that a fat dividend will also be declared for the second quarter of 2020. This should be reason to rejoice. Except that each dividend declaration raises the likelihood and extent of equity dilution should holders of $125m in convertible notes exercise their option.
The convertible senior notes were originally issued in August 2018. Holders earn an annual interest of 4.5% and they have the option to exchange the notes for common shares at any time before maturity