Category: New Issues

Emera Incorporated has announced (although not yet on their website):

that it will issue four million Cumulative Redeemable First Preferred Shares, Series E (the “Series E Shares”) at a price of $25.00 per share, for aggregate gross proceeds of $100 million on a bought deal basis to a syndicate of underwriters in Canada led by RBC Capital Markets, CIBC, Scotiabank and TD Securities Inc. RBC Capital Markets and CIBC are acting as joint bookrunners for the offering.

Emera has granted to the underwriters an option, exercisable at any time up to 48 hours prior to the date of closing, to purchase up to an additional one million Series E Shares at the same offering price, for additional gross proceeds of up to $25 million.

The holders of Series E Shares will be entitled to receive fixed cumulative preferential cash dividends at an annual rate of $1.125 per share, payable quarterly, as and when declared by the board of directors of the Company yielding 4.5% per annum. The initial dividend, if declared, will be payable on August 15, 2013 and will be $0.2034 per share, based on an anticipated closing date of June 10, 2013.

The Series E Shares will not be redeemable by the Company prior to August 15, 2018. On or after August 15, 2018 the Company may redeem all or any part of the then outstanding Series E Shares, at the Company’s option without the consent of the holder, by the payment of: $26.00 per share if redeemed before August 15, 2019; $25.75 per share if redeemed on or after August 15, 2019 but before August 15, 2020; $25.50 per share if redeemed on or after August 15, 2020 but before August 15, 2021; $25.25 per share if redeemed on or after August 15, 2021 but before August 15, 2022; and $25.00 per share if redeemed on or after August 15, 2022, together, in each case, with all accrued and unpaid dividends up to but excluding the date fixed for redemption. The Series E Shares do not have a fixed maturity date and are not redeemable at the option of the holders of Series E Shares.

The offering is subject to the receipt of all necessary regulatory and stock exchange approvals. The net proceeds of the offering will be used for general corporate purposes.

The Series E Shares will be offered to the public in Canada by way of prospectus supplement to the Company’s short form base shelf prospectus dated May 2, 2013.

Update, 2013-6-10: Emera announced on June 4:

that in connection with its recently announced public offering of 4,000,000 Cumulative Redeemable First Preferred Shares, Series E (the “Series E Shares”), the underwriters have exercised their option (the “Underwriters’ Option”) to purchase an additional 1,000,000 Series E Shares at a price of $25.00 per share. Emera will receive additional gross proceeds of $25 million from the exercise of the Underwriters’ Option, increasing the total size of the offering to $125 million. Closing of the Underwriters’ Option is expected to occur concurrently with the scheduled closing of the public offering on June 10, 2013.

Brookfield Asset Management has announced:

that it has agreed to issue 6,000,000 4.9% perpetual Class A Preference Shares, Series 37 (“Preferred Shares, Series 37”) on a bought deal basis to a syndicate of underwriters led by CIBC, RBC Capital Markets, Scotiabank and TD Securities for distribution to the public. The Preferred Shares, Series 37 will be issued at a price of C$25.00 per share, for aggregate gross proceeds of C$150,000,000.

Brookfield has granted the underwriters an option, exercisable until 48 hours prior to closing, to purchase up to an additional 2,000,000 Preferred Shares, Series 37 which, if exercised, would increase the gross offering size to C$200,000,000. The Preferred Shares, Series 37 will be offered in all provinces of Canada by way of a supplement to Brookfield Asset Management’s existing short form base shelf prospectus dated June 7, 2011 as amended on June 13, 2012 and December 10, 2012.
…
Brookfield intends to use the net proceeds of the issue of Preferred Shares, Series 37 to redeem its Preferred Shares, Series 21 and, to the extent the underwriters’ option is exercised, for general corporate purposes. The offering of Preferred Shares, Series 37 is expected to close on or about June 13, 2013.

Enbridge Inc. has announced:

that it has entered into an agreement with a group of underwriters to sell 12 million cumulative redeemable preference shares, series 3 (the “Series 3 Preferred Shares”) at a price of C$25.00 per share for distribution to the public. The aggregate gross proceeds will be C$300 million. Closing of the offering is expected on June 6, 2013.

The holders of Series 3 Preferred Shares will be entitled to receive fixed cumulative dividends at an annual rate of $1.00 per share, payable quarterly on the 1st day of March, June, September and December, as and when declared by the Board of Directors of Enbridge, yielding 4.00 per cent per annum, for the initial fixed rate period to but excluding September 1, 2019. The first quarterly dividend payment date is scheduled for September 1, 2013. The dividend rate will reset on September 1, 2019 and every five years thereafter at a rate equal to the sum of the then five-year Canadian Government bond yield plus 2.38 per cent. The Series 3 Preferred Shares are redeemable by Enbridge, at its option, on September 1, 2019 and on September 1 of every fifth year thereafter.

The holders of Series 3 Preferred Shares will have the right to convert their shares into cumulative redeemable preference shares, series 4 (the “Series 4 Preferred Shares”), subject to certain conditions, on September 1, 2019 and on September 1 of every fifth year thereafter. The holders of Series 4 Preferred Shares will be entitled to receive quarterly floating rate cumulative dividends, as and when declared by the Board of Directors of Enbridge, at a rate equal to the sum of the then 90-day Government of Canada treasury bill rate plus 2.38 per cent.

Enbridge has granted to the underwriters an option, exercisable at any time up to 48 hours prior to the closing of the offering, to purchase up to an additional 2 million Series 3 Preferred Shares at a price of $25.00 per share.

The offering is being made only in Canada by means of a prospectus. Proceeds will be used to partially fund capital projects, to reduce existing indebtedness and for other general corporate purposes of the Corporation and its affiliates.

The syndicate of underwriters is co-led by TD Securities Inc., CIBC, RBC Capital Markets and Scotiabank.

Update, 2013-6-1:Rated Pfd-2(low) by DBRS.

Canadian Utilities Limited has announced:

it has entered into an agreement with a syndicate of underwriters co-led by RBC Capital Markets and BMO Capital Markets, and including TD Securities Inc., Scotiabank, CIBC, Canaccord Genuity Corp., and GMP Securities L.P. The underwriters have agreed to buy 6,000,000 4.50% Cumulative Redeemable Second Preferred Shares Series DD at a price of $25.00 per share for aggregate gross proceeds of $150,000,000. The proceeds will be used for capital expenditures, to repay indebtedness and for other general corporate purposes.

Canadian Utilities Limited has granted the underwriters an option to purchase at the offering price an additional
2,000,000 Series DD Preferred Shares exercisable in whole or in part at any time up to 7:00 AM (Calgary time) on the date that is two business days prior to closing. Should the option be fully exercised, the total gross proceeds of the Series DD Preferred Share offering will be $200,000,000.

The Series DD Preferred Shares will be issued to the public at a price of $25.00 per share and holders will be entitled to receive fixed cumulative preferential cash dividends, payable quarterly as and when declared by the Board of Directors of the Corporation at an annual rate of $1.125 per share, to yield 4.50% annually. On or after September 1, 2018, the Corporation may redeem the Series DD Preferred Shares in whole or in part from time to time, at $26.00 per share if redeemed during the 12 months commencing September 1, 2018, at $25.75 per share if redeemed during the 12 months commencing September 1, 2019, at $25.50 per share if redeemed during the 12 months commencing September 1, 2020, at $25.25 per share if redeemed during the 12 months commencing September 1, 2021, and at $25.00 per share if redeemed on or after September 1, 2022.

The offering is being made only in the provinces of Canada by means of a prospectus supplement and the closing date of the issue is expected to be on or about May 15, 2013.

Update: Super-size me!:

Canadian Utilities Limited announced today that as a result of strong investor demand for its previously announced offering of Cumulative Redeemable Second Preferred Shares Series DD, the size of the offering has been increased to 9,000,000 shares. The aggregate gross proceeds will now be $225,000,000. The proceeds will be used for capital expenditures, to repay indebtedness and for other general corporate purposes.

In addition to the redemption of CGI.PR.B, Morgan Meighen & Associates has announced:

The Company further announced today that it has entered into an agreement with a syndicate of investment dealers led by Scotia Capital Inc. pursuant to which the syndicate has agreed to purchase 3,000,000 3.75% Cumulative Redeemable Class A Preference Shares, Series 4 of the Company (the “Series 4 Shares”) for gross proceeds of $75,000,000. The net proceeds of the offering, which is expected to close on May 30, 2013, will be used, together with available cash, to repay the short-term loan entered into to fund the redemption of the Series 2 Shares.

I am advised that this issue is retractible on or after June 15, 2023, for $25.00 cash. The issue may be called at $26.00 commencing June 15, 2018; the redemption price declines by 0.25 every June 15 until June 15, 2022; redeemable at 25.00 thereafter.

Angry pedants are advised that I consider this issue to be a Split Share because all of it’s credit quality is derived from an underlying investment portfolio; CGI is not an operating company.

Update, 2016-4-14: Trades as CGI.PR.D

Brookfield Renewable Energy Partners has announced:

that it has agreed to issue 5,000,000 5% perpetual Class A Preferred Shares, Series 6 (“Preferred Shares”) on a bought deal basis to a syndicate of underwriters led by Scotiabank, CIBC, RBC Capital Markets and TD Securities Inc. for distribution to the public. The Preferred Shares will be issued at a price of CDN$25.00 per share, for aggregate gross proceeds of CDN$125,000,000. The Preferred Shares are being issued through a wholly-owned subsidiary of, and are guaranteed by, Brookfield Renewable.

Brookfield Renewable has granted the underwriters an option, exercisable until 48 hours prior to closing, to purchase up to an additional 2,000,000 Preferred Shares which, if exercised, would increase the gross offering size to CDN$175,000,000.

The Preferred Shares will be offered to the public in Canada pursuant to a supplement to Brookfield Renewable’s existing short form base shelf prospectus dated January 23, 2012, that will be filed with securities regulatory authorities in each of the provinces and territories of Canada. The Preferred Shares may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements under the U.S. Securities Act.

The net proceeds of the issue will be used to repay outstanding indebtedness and for general corporate purposes. The offering of Preferred Shares is expected to close on or about May 1, 2013.

Artis Real Estate Investment Trust has announced:

that it has entered into an agreement to sell to a syndicate of underwriters led by RBC Capital Markets and CIBC (the “Underwriters”), on a bought deal basis, 2,000,000 Cumulative Rate Reset Preferred Trust Units, Series E (“Series E Units”) at a price of $25.00 per Series E Unit for gross proceeds to Artis of $50,000,000 (the “Financing”). Artis has also granted the Underwriters an option, exercisable at any time up to 48 hours prior to the closing of the Financing, to purchase a further 300,000 Series E Units at the issue price which, if fully exercised, would result in additional gross proceeds of $7,500,000.

The Series E Units will pay fixed cumulative preferential distributions of $1.1875 per Series E Unit per annum, yielding 4.75% per annum, payable on the last day of March, June, September and December of each year, as and when declared by the board of trustees of Artis, for the initial period ending September 30, 2018. The first quarterly distribution, if declared, shall be payable on June 30, 2013 and shall be $0.3286 per Series E Unit, based on the anticipated closing of the offering of Series E Units of March 21, 2013. The distribution rate will be reset on September 30, 2018 and every five years thereafter at a rate equal to the sum of the then five-year Government of Canada bond yield and 3.30%. The Series E Units are redeemable by Artis, at its option, on September 30, 2018 and on September 30 of every fifth year thereafter.

Holders of Series E Units will have the right to reclassify all or any part of their Series E Units as Cumulative Floating Rate Preferred Trust Units, Series F (the “Series F Units”), subject to certain conditions, on September 30, 2018 and on September 30 of every fifth year thereafter. Such reclassification privilege may be subject to certain tax considerations (to be disclosed in the prospectus supplement). Holders of Series F Units will be entitled to receive a floating cumulative preferential distribution, payable on the last day of March, June, September and December of each year, as and when declared by the board of trustees of Artis, at a rate equal to the sum of the then 90-day Government of Canada Treasury Bill yield plus a spread of 3.30%.

DBRS Limited (“DBRS”) has assigned a provisional rating of Pfd-3 (low) to the Series E Units.

The Financing is being made pursuant to the REIT’s base shelf prospectus dated June 15, 2012. The terms of the offering will be described in a prospectus supplement to be filed with Canadian securities regulators. The Financing is expected to close on or about March 21, 2013 and is subject to regulatory approval.

Artis intends to use the net proceeds from the Financing to repay indebtedness, fund future acquisitions, and for general trust purposes.

This issue joins AX.PR.A, a 5.25%+406 FixedReset which was recently added to HIMIPref™ and which closed yesterday at 26.05-15, for a YTW of 4.50%-4.40% to its next Exchange Date.

There will probably be funny taxation of the distributions – see the last paragraph of the first post about AX.PR.A.

Update: As noted by Assiduous Reader adrian2 in the comments the deal has been super-sized to $100-million.

Update, 2013-3-13: Rated Pfd-3(low) by DBRS.

Canadian Utilities Limited has announced:

it has entered into an agreement with a syndicate of underwriters co-led by BMO Capital Markets and RBC Capital Markets, and including TD Securities Inc. and Scotiabank. The underwriters have agreed to buy 6,000,000 4.50% Cumulative Redeemable Second Preferred Shares Series CC at a price of $25.00 per share for aggregate gross proceeds of $150,000,000. The proceeds will be used for capital expenditures, to repay indebtedness and for other general corporate purposes.

Canadian Utilities Limited has granted the underwriters an option to purchase at the offering price an additional
2,000,000 Series CC Preferred Shares exercisable in whole or in part at any time up to 7:00 AM (Calgary time) on the date that is two business days prior to closing. Should the option be fully exercised, the total gross proceeds of the Series CC Preferred Share offering will be $200,000,000.

The Series CC Preferred Shares will be issued to the public at a price of $25.00 per share and holders will be entitled to receive fixed cumulative preferential cash dividends, payable quarterly as and when declared by the Board of Directors of the Corporation at an annual rate of $1.125 per share, to yield 4.50% annually. On or after June 1, 2018, the Corporation may redeem the Series CC Preferred Shares in whole or in part from time to time, at $26.00 per share if redeemed during the 12 months commencing June 1, 2018, at $25.75 per share if redeemed during the 12 months commencing June 1, 2019, at $25.50 per share if redeemed during the 12 months commencing June 1, 2020, at $25.25 per share if redeemed during the 12 months commencing June 1, 2021, and at $25.00 per share if redeemed on or after June 1, 2022.

The offering is being made only in the provinces of Canada by means of a prospectus supplement and the closing date of the issue is expected to be on or about March 19, 2013.

This joins their two existing Straights:

• CU.PR.D, 4.9%, quoted at 26.41-42 to yield 4.14-13%
• CU.PR.E, 4.9%, quoted at 26.35-44 to yield 4.17-12%

Update 2013-3-10: Upsized to $175-million.

Capital Power Corporation has announced:

that it will issue 6,000,000 Cumulative Rate Reset Preference Shares, Series 5 (the “Series 5 Shares”) at a price of $25 per Series 5 Share (the “Offering”) for aggregate gross proceeds of $150 million on a bought deal basis with a syndicate of underwriters, led by RBC Capital Markets and Scotiabank. In addition, Capital Power has granted the underwriters an option, exercisable in whole or in part anytime up to two business days prior to closing, to purchase up to an additional 2,000,000 Series 5 Shares on the same terms, for additional gross proceeds of up to $50 million. Any additional Series 5 Shares will also be issued on the closing date.

The Series 5 Shares will pay fixed cumulative dividends of $1.125 per share per annum, yielding 4.50% per annum, payable on the last business day of March, June, September and December of each year, as and when declared by the board of directors of Capital Power, for the initial period ending June 30, 2018. Based on a March 14, 2013 closing, the first quarterly dividend of $0.3329 per share is expected to be paid on June 28, 2013. The dividend rate will be reset on June 30, 2018 and every five years thereafter at a rate equal to the sum of the then five-year Government of Canada bond yield and 3.15%. The Series 5 Shares are redeemable by Capital Power, at its option, on June 30, 2018 and every five years thereafter.

Holders of Series 5 Shares will have the right to convert all or any part of their shares into Cumulative Floating Rate Preference Shares, Series 6 (the “Series 6 Shares”), subject to certain conditions, on June 30, 2018 and every five years thereafter. Holders of Series 6 Shares will be entitled to receive a cumulative quarterly floating dividend at a rate equal to the sum of the then 90-day Government of Canada Treasury Bill yield plus 3.15%, as and when declared by the board of directors of Capital Power.

Net proceeds of the offering will be lent to Capital Power L.P. pursuant to a subordinated debt agreement. Capital Power L.P. will use the funds to repay the outstanding balance under its credit facilities, to finance development projects including the Shepard Energy Centre project, and for general corporate purposes.

Standard & Poor’s, a division of the McGraw Hill Companies, Inc. has assigned a rating of P-3 for the Series 5 Shares and DBRS Limited has assigned a preliminary rating of Pfd-3 (low) for the Series 5 Shares.

The Series 5 Shares will be issued pursuant to a prospectus supplement to Capital Power’s short form base shelf prospectus dated February 16, 2012. This prospectus supplement will be filed with securities regulatory authorities in Canada. An application will be made when the prospectus supplement is filed to list the Series 5 Shares and the Series 6 Shares on the Toronto Stock Exchange as of the closing date. The Offering is subject to receipt of all necessary regulatory and stock exchange approvals.

This issue may be compared with their two extant FixedResets:

• CPX.PR.A, 4.60%+217, quoted at 25.05-95 to yield 3.46%-3.26%
• CPX.PR.C, 4.60%+323, quoted at 25.15-25 to yield 4.33%-4.31%

Yields are quoted to perpetuity (which is the YTW scenario), assuming five-year Canadas trade at 1.20%. It will be noted that in the glorious brain-dead tradition of the Canadian preferred share market, the prices reflect only the current coupon and not expectations on reset.

Update, 2013-3-10: Upsized to $200-million.