Category: Issue Comments

Quadravest has announced:

Financial 15 Split Corp. (the “Company”) is pleased to announce that it has filed a short form prospectus in each of the provinces of Canada with respect to an additional offering of preferred shares (“Preferred Shares”) and class A shares (“Class A Shares”) of the Company. The offering will be co-led by National Bank Financial Inc., CIBC World Markets Inc. and RBC Capital Markets.

The Preferred Shares will be offered at a price of $10.00 per Preferred Share to yield 5.25% and the Class A Shares will be offered at a price of $8.50 per Class A Share to yield 17.7%. The closing price of each of the Preferred Shares and the Class A Shares on October 29, 2013 on the TSX was $9.38 and $10.13, respectively.

The proceeds of the secondary offering, net of expenses and the Agents’ fee, will be used by the Company to invest in a high quality portfolio consisting of 15 financial services companies made up of Canadian and U.S. issuers as follows:

Bank of Montreal	National Bank of Canada	Bank of America Corp.
The Bank of Nova Scotia	Manulife Financial Corporation	Citigroup Inc.
Canadian Imperial Bank of Commerce	Sun Life Financial Services of Canada Inc.	Goldman Sachs Group Inc.
Royal Bank of Canada	Great-West Lifeco Inc.	JP Morgan Chase & Co.
The Toronto-Dominion Bank	CI Financial Corp.	Wells Fargo & Co.

The Company’s investment objectives are:

Preferred Shares:
i. to provide holders of the Preferred Shares with fixed, cumulative preferential monthly cash dividends in the amount of $0.04375 per Preferred Share to yield 5.25% per annum on the original issue price; and
ii. on or about the termination date, currently December 1, 2015 (the “Termination Date”), to pay the holders of the Preferred Shares $10.00 per Preferred Share, which was the original issue price of the Preferred Shares.

Class A Shares:
i. to provide holders of the Class A Shares with regular monthly cash dividends initially targeted to be $0.10 per Class A Share to yield 8.0% per annum on the original issue price of the Class A Shares, and currently targeted to be $0.1257 per Class A Share;
ii. on or about Termination Date, to pay the holders of Class A Shares $15.00 per Class A Share, which was the original issue price of the Class A Shares.

The Company is currently scheduled to terminate on December 1, 2015. The Company intends to seek shareholder approval to extend the Termination Date initially to December 1, 2020, and thereafter for additional terms of five years each at the discretion of Quadravest Capital Management Inc., as the manager of the Company. In conjunction with such extension, if approved, shareholders would be offered a special retraction right which would allow them to exit their investment in the Company on the same basis as if the Company were to terminate on its otherwise scheduled Termination Date. Further information regarding the term extension will be provided at the time meetings of shareholders are called to consider and, if deemed acceptable, approve the extension.

The sales period of this overnight offering will end at 8:30 a.m. EST on October 31, 2013.

A copy of the preliminary short form prospectus is available from National Bank Financial Inc., CIBC World Markets Inc. and RBC Capital Markets.

FTN.PR.A was last mentioned on PrefBlog in connection with its Semi-Annual Report 13H1.

FTN.PR.A is tracked by HIMIPref™ but is relegated to the Scraps index on credit concerns.

DBRS has announced that it:

has today downgraded Thomson Reuters Corporation’s (Thomson Reuters or the Company) Issuer Rating, Unsecured Debentures and Unsecured Medium-Term Notes ratings to BBB (high) from A (low), Commercial Paper rating to R-2 (high) from R-1 (low) and Preferred Shares rating to Pfd-3 (high) from Pfd-2 (low). The trends are all Stable. This action follows the Company’s change in financial management guidelines. As part of a broader plan to improve its business mix and cost structure while returning value to shareholders, the Company now intends to target a net debt-to-EBITDA ratio of up to 2.5 times (x) from 2.0x prior.
…
The downgrade reflects DBRS’s view that the Company’s target net debt-to-EBITDA ratio of up to 2.5x results in a credit risk profile that is no longer consistent with the A (low) rating category. Going forward, DBRS will continue to monitor the progress of Thomson Reuters’ strategic initiatives related to product simplification, cost cutting, non-core asset dispositions and the effective rollout of the Company’s financial data provision platforms. Thomson Reuters’ revised ratings with Stable trends reflect the Company’s entrenched market position, the diverse nature of its customer base and its predominantly subscription-based revenue model. The ratings also reflect the need for constant innovation, exposure to changing technology, intensifying competition in key segments and the risks associated with the Company’s acquisition and divestiture program.

TRI.PR.B was last mentioned on PrefBlog when S&P put it on Trend-Negative in May 2012.

Standard & Poor’s also downgraded the company but preferreds were not affected:

• We are lowering our corporate credit rating on New York-based Thomson Reuters Corp. to ‘BBB+’ from ‘A-‘ given the company’s shift in financial policy, which will result in higher debt leverage.
• In addition, we are assigning our ‘A-2′ global scale short-term rating to Thomson Reuters’ commercial paper program.
• We expect Thomson Reuters’ adjusted debt leverage will remain above our 2.5x maximum threshold for the ‘A-‘ corporate credit rating in the medium term.
• We also expect the company to use all of its discretionary cash flow and additional debt to repurchase up to US$1 billion in shares next year, as well as pay dividends, make acquisitions, and fund a US$350 million one-time charge.
• The stable outlook reflects our belief that Thomson Reuters’ operating
  performance will improve in the next year; that the company will successfully complete its Financial & Risk division transformation in
  2014, resulting in healthy and sustainable revenue and EBITDA growth; and that credit ratios will remain in line with our expectations in the medium term, including adjusted debt to EBITDA below 3x on a sustainable basis.

…
“The downgrade reflects the company’s shift in its financial policy to allow for a higher level of debt leverage, namely a maximum of 2.5x net debt to EBITDA from the prior target of 2.0x,” said Standard & Poor’s credit analyst Lori Harris. Adding our adjustments, we believe Thomson Reuters’ debt leverage will remain above our maximum 2.5x threshold for the company at the ‘A-‘ rating level. We expect Thomson Reuters to use all of its discretionary cash flow and additional debt this year and next for share repurchases, one-time charges, material pension plan contributions, dividends, and acquisitions. Specifically, management has announced plans for a US$350 million one-time charge mostly for its F&R division and a US$500 million contribution to its defined benefit pension plans this year, as well as up to US$1 billion in share repurchases next year.

TRI.PR.B is tracked by HIMIPref™ and is currently included in the Floaters subindex. It will be moved to Scraps at the regular monthly rebalancing on October 31, on credit concerns.

BNS.PR.B, a FloatingReset +170 just converted from BNS.PR.Q, reached only a very small premium over BNS.PR.Q on its debut today.

The issue traded 17,400 shares in a range of 24.70-15 before settling at 24.85-05, 1×11.

BNS.PR.B will be tracked by HIMIPref™ and is temporarily assigned to the FixedReset subindex. When TD.PR.Z settles on October 31 all FloatingResets will be transferred from the FixedReset subindex to a new FloatingReset subindex.

We can examine the comparables with the help of the Pairs Equivalency Calculator:

So BNS.PR.B has the smallest premium of the lot. It will be most interesting to see whether the bloom is off the rose as far as FloatingResets are concerned!

Vital Statistics are:

The Toronto-Dominion Bank has announced:

that 4,518,147 of its 10 million Non-Cumulative 5-Year Rate Reset Preferred Shares, Series Y (the “Series Y Shares”) will be converted on October 31, 2013, on a one-for-one basis, into Non-Cumulative Floating Rate Preferred Shares, Series Z (the “Series Z Shares”) of TD. As a result, on October 31, 2013, TD will have 5,481,853 Series Y Shares and 4,518,147 Series Z Shares issued and outstanding. The Series Y Shares and the Series Z Shares will be listed on the Toronto Stock Exchange under the symbols TD.PR.Y and TD.PR.Z, respectively.

TD.PR.Y will reset at 3.5595%. I recommended conversion to TD.PR.Z.

Brompton Group has announced:

) Dividend Growth Split Corp. is pleased to announce that it has completed a treasury offering of 3,130,000 class A shares and 3,130,000 preferred shares for aggregate gross proceeds of approximately $60 million. Shares will continue to trade on the Toronto Stock Exchange under the existing symbols DGS (class A shares) and DGS.PR.A (preferred shares).

Dividend Growth Split Corp. invests in a portfolio of common shares of high quality, large capitalization companies, which have among the highest dividend growth rates of those companies included in the S&P/TSX Composite Index. Currently, the portfolio consists of common shares of the following 20 companies:

Great-West Lifeco Inc.	The Bank of Nova Scotia	AGF Management Limited	Shaw Communications Inc.
Industrial Alliance Insurance and Financial Services Inc.	Canadian Imperial Bank of Commerce	IGM Financial Inc.	TELUS Corporation
Manulife Financial Corporation	National Bank of Canada	Power Corporation of Canada	Canadian Utilities Limited
Sun Life Financial Inc.	Royal Bank of Canada	Manitoba Telecom Services	Enbridge Inc.
Bank of Montreal	The Toronto-Dominion Bank	Rogers Communications Inc.	TransCanada Corporation

The class A shares were offered at a price of $9.10 and the preferred shares were offered at a price of $10.07. The final class A and preferred share offering prices were determined so as to be non-dilutive to the most recent calculated net asset value per unit of the Company prior to the filing of the prospectus.

The investment objectives for the class A shares are to provide holders with regular monthly cash distributions targeted to be $0.10 per class A share, and to provide the opportunity for growth in net asset value.

The investment objectives for the preferred shares are to provide holders with fixed cumulative preferential quarterly cash distributions currently in the amount of $0.13125 per preferred share, representing a yield on the offer price of 5.2% per annum, and to return the original issue price to holders of preferred shares on the maturity date.

On October 1, 2013, the Company announced an extension of the maturity date of the class A and preferred shares of the Company for an additional 5 year term to November 28, 2019, subject to extension for successive terms of up to 5 years. The preferred share dividend rate for the extended term will be announced at least 60 days prior to the original November 30, 2014 maturity date. The new dividend rate will be determined based on then-current market yields for preferred shares with similar terms.

The syndicate of agents for the offering was led by RBC Capital Markets and CIBC and includes Scotiabank, TD Securities Inc., BMO Capital Markets, National Bank Financial Inc., GMP Securities L.P., Raymond James Ltd., Canaccord Genuity Corp., Desjardins Securities Inc., Dundee Securities Ltd., Mackie Research Capital Corporation, and Macquarie Private Wealth Inc.

The company’s intent to proceed with the Treasury Offering was previously reported on PrefBlog.

DGS.PR.A is tracked by HIMIPref™ but is relegated to the Scraps index on credit concerns.

Veresen Inc. has announced:

that it has closed its previously announced bought deal offering of 6,000,000 Cumulative Redeemable Preferred Shares, Series C (the “Series Preferred Shares”) at a price of $25.00 per share representing aggregate gross proceeds of $150,000,000 (the “Offering”).

The Offering was first announced by Veresen on October 9, 2013 when Veresen entered into an agreement with a syndicate of underwriters co-lead by Scotiabank, TD Securities Inc. and CIBC.

Proceeds from the Offering will be used to reduce indebtedness and for general corporate purposes.

The Series C Preferred Shares have been rated Pfd-3 (High) by DBRS Limited and P-3 (High) by Standard & Poor’s, a division of The McGraw Hill Companies, Inc.

The Series C Preferred Shares will begin trading on the Toronto Stock Exchange today under the symbol “VSN.PR.C”.

VSN.PR.C is a FixedReset, 5.00%+301 announced October 9. It has been rated Pfd-3(high) [Stable] by DBRS; it will be tracked by HIMIPref™ but relegated to the Scraps index on credit concerns.

The issue traded 259,016 shares today in a range of 24.60-88 before closing at 24.70-82, 4×48.

Vital statistics are:

Great-West Lifeco has announced:

that it will seek the consent of the holders of its 6.67% Debentures due March 21, 2033 (the “2033 Debentures”) to amend the trust indenture dated as of March 21, 2003, between Great-West Lifeco and Computershare Trust Company of Canada, as trustee, as amended and supplemented. The consent will eliminate the replacement capital covenants and related provisions applicable to certain of Great-West Lifeco’s preferred shares, the 5.691% Subordinated Debentures due June 21, 2067 issued by Great-West Lifeco Finance (Delaware) LP and the 7.127% Subordinated Debentures due June 26, 2068 issued by Great-West Lifeco Finance (Delaware) LP II.

Great-West Lifeco is seeking to remove the replacement capital covenants in order to have greater flexibility to manage its capital structure. Removal of the replacement capital covenants would provide Great-West Lifeco with the ability to be responsive to credit rating agency considerations and emerging regulatory capital developments. The proposed changes do not imply that Great-West Lifeco intends to take any future action with respect to the redemption of any of the securities currently subject to the replacement capital covenants.

Great-West Lifeco will solicit consents from holders of record of the 2033 Debentures as of 5:00 p.m., Toronto time, on October 11, 2013. The proposed amendments require the consent of holders of not less than 66 2/3% of the outstanding principal amount of the 2033 Debentures. The terms and conditions of the consent solicitation will be included in the consent solicitation statement and the accompanying form of consent.

Certain information regarding the 2033 Debentures and the terms of the offer and the consent solicitation is summarized in the table below:

Debentures CUSIP No. Principal Amount Outstanding Consent Fee (per $1,000
principal amount)
6.67% Debentures due March 21, 2033 39138CAD8 $400,000,000 $12.50

Great-West Lifeco will pay a consent fee of $12.50 in cash for each $1,000 in principal amount of 2033 Debentures for which Great-West Lifeco has received a valid (and unrevoked) consent prior to the expiration of the solicitation, subject to the conditions of the solicitation. Assuming receipt of the requisite 66 2/3% consent, payments of the consent fee are anticipated to be made to holders of the 2033 Debentures that provide valid (and unrevoked) consents on the third business day following the expiration of the solicitation. If the proposed amendments are approved, the amendments will bind all holders of the 2033 Debentures, including those that did not provide a consent.

The solicitation will expire at 5:00 p.m. (Toronto time) on October 30, 2013, unless extended by Great-West Lifeco at its discretion (such time on such date, as the same may be extended, the “Expiration Date”).

Great-West Lifeco will make an announcement by press release of any extension of the Expiration Date prior to 9:00 a.m. (Toronto time), on the next business day after the previously scheduled Expiration Date. Holders may deliver their consents with respect to the solicitation at any time prior to the Expiration Date. Holders may revoke their consents until the earlier of the Expiration Date and the date that the proposed amendment to the trust indenture is executed and becomes effective. Any holder who validly revokes a consent will not be eligible to receive the consent fee, unless such consent is redelivered and accepted by Great-West Lifeco prior to the Expiration Date.

Great-West Lifeco has retained RBC Dominion Securities Inc. to serve as the solicitation agent for the solicitation, Georgeson Shareholder Communications Canada Inc. to serve as the information agent and Computershare Trust Company of Canada to serve as the tabulation agent. Questions regarding the solicitation may be directed to RBC Dominion Securities Inc. at (416) 842-6311.

This is rather interesting – a vote to change a bond indenture doesn’t come up very often and the consent fee – of over a dollar a bond – is quite attractive.

According to the Consent Solicitation Statement:

The principal effect of the replacement capital covenant is to require that a specified portion of any funds used to repurchase, redeem or repay the Preferred Stock, GWL-LP Subordinated Debentures and GWL-LP II Subordinated Debentures must be obtained by the Corporation through the issuance of common shares or other equity or equity-like securities, in each case within a specified time period prior to the applicable repurchase, redemption or repayment.

The replacement capital covenants were provided by the Corporation voluntarily. For that reason, consent of the Holders of the 2033 Debentures was not required under the Indenture. The replacement capital covenants afforded Great-West Lifeco enhanced credit rating agency capital treatment. Subsequent changes to credit rating methodology means this benefit is no longer available to Great-West Lifeco. Accordingly, Great-West Lifeco is seeking to remove the replacement capital covenants in order to have greater flexibility to manage its capital structure without being subject to the restrictions and constraints of the replacement capital covenants.

So why don’t they just redeem these sub-debs, with their enormous (by current standards) coupon? A look at the prospectus (available on SEDAR, dated March 14, 2003; I am not allowed to link to this prospectus due to the bank-owned CDS’ abuse of the monopoly granted to it by the regulators) reveals:

The Corporation may, at its option, redeem Debentures on not less than 30 nor more than 60 days’ prior notice to the registered holder, in whole at any time or in part from time to time, at a redemption price equal to the greater of the Canada Yield Price and par, together in each case with accrued and unpaid interest to the date fixed for redemption. In cases of partial redemption of Debentures issued under a Trust Indenture, the Debentures to be redeemed will be selected by the Trustee pro rata or in such manner as it shall deem equitable. Any Debentures that are redeemed by the Corporation will be cancelled and will not be reissued.
…
‘‘Canada Yield Price’’, shall mean a price which, if the Debentures were to be issued at such price on the redemption date, would provide a yield thereon from the redemption date to March 21, 2018 in the case of 2018 Debentures and March 21, 2033 in the case of 2033 Debentures, equal to the Government of Canada Yield, plus 24 basis points for the 2018 Debentures and 30 basis points for the 2033 Debentures, compounded semi-annually and calculated on the day that is three business days prior to the date of redemption.

So say that 20-year Canadas are now at 3.00% (approximately) then the Canada Yield is 3.30% and the Canada Price is around $148 per $100 bond – a pretty fat premium and illustrative of just how wonderful Canada Calls are, as opposed to regular calls. Paying a premium of $1.25 (plus expenses) to change the indenture is a lot cheaper.

But just why they are doing this is a little mysterious. Given that 400-million par value of these things is outstanding, GWO is prepared to spend $5-million (plus expenses of … what? half a million?) to get this flexibility. While this is hardly crippling to a company the size of GWO, it’s not pocket change either. While they say The proposed changes do not imply that Great-West Lifeco intends to take any future action with respect to the redemption of any of the securities currently subject to the replacement capital covenants that’s a little bit of a fuzzy statement, if you look at it carefully … and besides, a contingency plan with a 99.999% chance of being executed is still only a contingency.

They have a few Straight Perpetuals with fat coupons outstanding, led by GWO.PR.F at 5.9% which is currently callable at par. Of more immediate interest is GWO.PR.J, a FixedReset, 6.00%+307, which has its first Exchange Date on 2013-12-31. This certainly looks like it should be called on economic grounds, but they may not wish to issue new securities to replace the capital; and it may be worth $5.5-million to them to avoid the necessity. In addition:

The Canada Life Assurance Company has one subordinated debenture outstanding with a face amount of $100 million. Great-West Lifeco Finance (Delaware) LP has one subordinated debenture outstanding with a face amount of $1 billion. Great-West Lifeco Finance (Delaware) LP II has one subordinated debenture outstanding with a face amount of $500 million. Great-West Life & Annuity Insurance Capital, LP has one subordinated debenture outstanding with a face amount of US$175 million, and Great-West Life & Annuity Insurance Capital, LP II has one subordinated debenture outstanding with a face amount of US$300 million.

From the 2012 Annual Report:

The Company regards the Series F, G, H, I, L, M, P, Q and R preferred shares as part of its core or permanent capital. The Series F, G, H, I, L and M preferred shares have a replacement capital covenant, the Company only intends to redeem these shares with proceeds raised from new capital instruments representing equal or greater benefit than the shares currently outstanding. The Series P, Q and R preferred shares do not have a replacement capital covenant. The Company regards the two series of subordinated debentures totaling $1,500 million issued by two subsidiary companies, Great-West Lifeco Finance (Delaware) LP and LPII, as comprising part of its core or permanent capital. As such the Company only intends to redeem the subordinated debentures prior to maturity with new capital instruments with a similar or more junior ranking security. The terms and conditions of the $1,000 million subordinated debentures due June 21, 2067 bear interest at a rate of 5.691% until 2017 and, thereafter at a rate equal to the Canadian 90-day Bankers’ Acceptance rate plus 1.49%, unsecured. The terms of the $500 million subordinated debentures due June 26, 2068 bear interest at a rate of 7.127% until 2018 and, thereafter, at a rate equal to the Canadian 90-day Bankers’ Acceptance rate plus 3.78%, unsecured.

I consider it rather odd that the Series J preferreds are not regarded as core capital, but this – contrary to my initial expectations – is not a new thing: they are omitted from the list in each of the past four Annual Reports. None of the words “permanent”, “replacement” or “indenture” occurs anywhere in the Series J prospectus, dated Nov 13 2008, but there’s nothing of interest in the Series M prospectus dated February 24, 2010, either, so that doesn’t mean much.

So anyway, I will admit that I am perplexed by this solicitation. The most facile answer is that they want to redeem GWO.PR.F (with its 5.9% coupon) and don’t want to issue replacement capital (or want to have the option to do this), but I wouldn’t place any large bets on that possibility.

Another possibility is that the covenant somehow violates OSFI rules and they have to get rid of it in order to qualify the preferreds, or perhaps even the sub-debs themselves, as quality – or consider that there is a high enough probability of this being a requirement that they want to get it out of the way.

Any opinions on possible motivations for this action will be most welcome!

GWO has the following preferred shares outstanding: GWO.PR.F, GWO.PR.G, GWO.PR.H, GWO.PR.I, GWO.PR.J, GWO.PR.L, GWO.PR.M, GWO.PR.N, GWO.PR.P, GWO.PR.Q and GWO.PR.R.

Update, 2013-11-7: GWO increased the consent fee…

Great-West Lifeco Inc. is amending the terms of its consent solicitation of the holders of its 6.67% Debentures due March 21, 2033 (the “2033 Debentures”) to eliminate the replacement capital covenants and related provisions applicable to certain of Great-West Lifeco’s preferred shares, the 5.691% Subordinated Debentures due June 21, 2067 issued by Great-West Lifeco Finance (Delaware) LP and the 7.127% Subordinated Debentures due June 26, 2068 issued by Great-West Lifeco Finance (Delaware) LP II.

The consent solicitation is amended to provide that Great-West Lifeco will pay a consent fee of $17.50 in cash for each $1,000 in principal amount of 2033 Debentures to all holders of 2033 Debentures provided that it has received the requisite consent from 66 2/3% of the holders of the 2033 Debentures. If the proposed amendments are approved, the amendments will bind all holders of the 2033 Debentures, including those that did not provide a consent.

All other terms of the solicitation remain in effect unamended including the expiration of the solicitation at 5:00 p.m. (Toronto time) on Wednesday, October 30, 2013.

… and obtained consent:

Great-West Lifeco Inc. successfully completed its consent solicitation of the holders of its 6.67% Debentures due March 21, 2033 (the “2033 Debentures”). The holders of the 2033 Debentures approved the elimination of the replacement capital covenants and related provisions applicable to certain of Great-West Lifeco’s preferred shares, the 5.691% Subordinated Debentures due June 21, 2067 issued by Great-West Lifeco Finance (Delaware) LP and the 7.127% Subordinated Debentures due June 26, 2068 issued by Great-West Lifeco Finance (Delaware) LP II.

The Bank of Nova Scotia has announced:

that 5,960,732 of its 14,000,000 Non-cumulative 5-Year Rate Reset Preferred Shares Series 20 of Scotiabank (the “Preferred Shares Series 20”) have been elected for conversion on October 26, 2013, on a one-for-one basis, into Non-cumulative Floating Rate Preferred Shares Series 21 of Scotiabank (the “Preferred Shares Series 21”). Consequently, on October 26, 2013, Scotiabank will have 8,039,268 Preferred Shares Series 20 and 5,960,732 Preferred Shares Series 21 issued and outstanding. The Preferred Shares Series 20 and Preferred Shares Series 21 will be listed on the Toronto Stock Exchange under the symbols BNS.PR.Q and BNS.PR.B, respectively.

I had previously recommended conversion of BNS.PR.Q to BNS.PR.B.

Canadian General Investments Limited has released its Semi-Annual Report to June 30, 2013.

Figures of interest are:

MER: The MER per unit of the Fund, excluding the cost of leverage, was 1.76% as at June 30, 2013.

Average Net Assets: We need this figure to calculate portfolio yield. [(456.1-million (NAV, beginning of period) + 443.9-million (NAV, end of period)] / 2 = about $450.0-million.

Underlying Portfolio Yield: Total income of 7.340-million times two (semi-annual) divided by average net assets of 450.0-million is 3.26%

Income Coverage: Total Investment Income of 7.340-million divided by Expenses and Preferred Share Distributions of 7.224-million is 102%.

Unit Value: To use the Split Share Credit Quality Model, we need a unit value, but the company does not keep the number of capital units equal to the number of preferred shares. However, shareholders’ equity is 442.1-million, compared to preferred shares outstanding of 150-million, so we can say that the Unit Value is 3.95x the preferred share value, so call it (equivalent to) 98.68.

Capital Unit Dividends: Dividends of 2.503-million were paid to capital unitholders in 13H1; this was 34% of total investment income, which we determined above was 3.26% of total assets. Therefore 1.11% of total assets were paid as capital unit dividends. Total assets can be modelled as 25.00 (preferred) + 98.68 (capital units) = 123.68 and 1.11% of that is $1.37.

CGI has two series of preferred shares outstanding: CGI.PR.C and CGI.PR.D.