New Issue : Co-operators 5% Perpetual

In order to pay for the redemption of CCS.PR.A, Co-operators General Insurance is issuing a 5% Perp.

They announced via CCN Matthews:

today announced that it has entered into an agreement with Scotia Capital Inc. on behalf of a syndicate of underwriters pursuant to which the underwriters have agreed to buy and offer for sale by way of a public offering of $100 million of Non-Cumulative Redeemable Class E Preference Shares, Series C (“Series C Preference Shares”) on a bought deal basis.

Co-operators General will issue 4 million Series C Preference Shares priced at $25.00 per share and holders will be entitled to receive fixed non-cumulative preferential quarterly cash dividends in the amount of $0.3125 per Series C Preference Share, to yield 5.00 per cent per annum. The offering is underwritten by a syndicate of investment dealers led by Scotia Capital Inc. The expected closing date for the offering is June 12, 2007.

The issue is rated P-2(low) by S&P and Pfd-3 by DBRS.

I will provide more information as it becomes available.

Update, 2007-05-29: The Preliminary Short Form Prospectus is now available on SEDAR, dated May 28, 2007. The redemption terms are:

Subject to the prior consent of the Superintendent of Financial Institutions (Canada) (the “Superintendent”) , and subject to the provisions of the Insurance Companies Act (Canada), on and after June 30, 2012, Co-operators General may redeem at any time all or from time to time any part of the outstanding Series C Preference Shares, at Co-operators General’s option, by the payment of an amount in cash (the “Redemption Price”) for each Series C Preference Share of $26.00 if redeemed during the 12 months commencing June 30, 2012, $25.75 if redeemed during the 12 months commencing June 20, 2013, $25.50 if redeemed during the 12 months commencing June 30, 2014, $25.25 if redeemed during the 12 months commencing June 30, 2015, and $25.00 if redeemed on or after June 30, 2016, together in each case with an amount equal to all declared and unpaid preferential dividends up to but excluding the date fixed for redemption. See “Details of the Offering”.

Update, 2007-05-29, #2 : Forgot the dividend information!

The initial dividend, if declared, will be payable on September 30, 2007 and will amount to $0.3767 per Series C Preference Share, based on an anticipated closing date of June 12, 2007. See “Details of the Offering”.

Update, 2007-05-29, #3: Look out below! When priced on the taxable-in-Ontario curve, the curvePrice is $23.86:

Price due to base-rate :  23.52
Price due to short-term :  -0.49
Price due to long-term :   1.80
Price due to Interest Income :   0.00
Price to to Cumulative Dividends :   0.00
Price due to SplitShareCorp :   0.00
Price due to Retractibility :   0.00
Price due to Credit Spread (2) :   0.00
Price due to Liquidity :   0.63
Price due to Floating Rate :   0.00
Price due to Credit Spread (3) :  -1.78
Price due to error :   0.18
Price due to Credit Spread (High) :   0.00
Price due to Credit Spread (Low) :   0.00

Update, 2007-5-31: It’s getting worse! The curve price is now $23.54!

Update, 2007-06-01: Curve Price now $23.45

Update, 2007-06-04: Curve Price now $23.36

Update, 2007-06-05: Curve Price now $23.18

Update, 2007-06-06: Curve Price now $23.11

Update, 2007-06-07: Whoosh! Curve Price now $22.67

Update, 2007-06-08: Will the bleeding never stop? $22.57

Update, 2007-06-11: Scheduled to close tomorrow. $22.47

One Response to “New Issue : Co-operators 5% Perpetual”

  1. […] In a dismal opening session even by recent standards, CCS.PR.C, announced May 23, commenced trading today. […]

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