New Issue: INE Straight Perpetual 5.75%

Innergex Renewable Energy has announced:

that it has entered into an agreement to issue, on a bought deal basis, to a syndicate of underwriters co-led by TD Securities Inc., National Bank Financial Inc. and BMO Capital Markets for distribution to the public, 2,000,000 Cumulative Redeemable Fixed-Rate Preferred Shares Series C (the “Series C Shares”). The Series C Shares will be issued at a price of $25.00 per Series C Share, for aggregate gross proceeds of $50,000,000. The underwriters will have an option to purchase up to an additional 300,000 Series C Shares from Innergex at a price of $25.00 per Series C Share, exercisable in whole or in part at any time for a period of up to 30 days following closing of the offering, which, if exercised in full, would increase the gross offering size to $57,500,000.

These funds will be used to repay a portion of the Corporation’s revolving term credit facility and for general corporate purposes.

Holders of the Series C Shares will be entitled to receive, as and when declared by the Board of Directors of Innergex, a cumulative quarterly fixed dividend yielding 5.75% annually. The Series C Shares will not be redeemable prior to January 15, 2018. On and after January 15, 2018 on not more than 60 nor less than 30 days’ notice, Innergex may, at its option, redeem all or from time to time any of the then outstanding Series C Shares upon payment in cash for each share so redeemed of an amount equal to $26.00 per share if redeemed on or prior to January 15, 2019; at $25.75 if redeemed thereafter and on or prior to January 15, 2020; at $25.50 if redeemed thereafter and on or prior to January 15, 2021; at $25.25 if redeemed thereafter and on or prior to January 15, 2022; and at $25.00 per share if redeemed thereafter; together, in each case, with all accrued and unpaid dividends to the date fixed for redemption. The Series C Shares will rank pari passu with all other series of preferred shares and in priority to common shares as to the payment of dividends and the distribution of assets on dissolution, liquidation, or wind-up.

The Series C Shares will be offered for sale to the public in each of the provinces of Canada pursuant to a short form prospectus to be filed with Canadian securities regulatory authorities. The offering of Series C Shares is expected to close on December 11, 2012, subject to regulatory approvals and other customary closing conditions.

Interestingly, the headline on the Innergex media page refers to an issue size of $75-million. Random mistake or last minute downsizing?

Update: DBRS calls it Pfd-3(low), Negative Trend.

One Response to “New Issue: INE Straight Perpetual 5.75%”

  1. […] is a Straight Perpetual, 5.75%, announced November 21. It is rated Pfd-3(low) [Trend Negative] by […]

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