Category: New Issues

TransAlta Corporation has announced:

that it has agreed to issue to a syndicate of underwriters led by CIBC, RBC Capital Markets and Scotiabank for distribution to the public 6,000,000 Cumulative Redeemable Rate Reset First Preferred Shares, Series E (the “Series E Shares”). The Series E Shares will be issued at a price of $25.00 per Series E Share, for aggregate gross proceeds of $150 million. Holders of the Series E Shares will be entitled to receive a cumulative quarterly fixed dividend yielding 5% annually for the initial period ending September 30, 2017. Thereafter, the dividend rate will be reset every five years at a rate equal to the 5-year Government of Canada bond yield plus 3.65%.

Holders of Series E Shares will have the right, at their option, to convert their shares into Cumulative Redeemable Floating Rate Reset First Preferred Shares, Series F (the “Series F Shares”), subject to certain conditions, on September 30, 2017 and on September 30 every five years thereafter. Holders of the Series F Shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada Treasury Bill yield plus 3.65%.

TransAlta Corporation has granted the underwriters an option, exercisable in whole or in part prior to closing, to purchase up to an additional 3,000,000 Series E Shares at the same offering price. The Series E Shares will be offered by way of prospectus supplement under the short form base shelf prospectus of TransAlta Corporation dated November 15, 2011. The prospectus supplement will be filed with securities regulatory authorities in all provinces of Canada.

The net proceeds of the Offering will be used to partially fund capital projects, for other general corporate purposes and to reduce short term indebtedness of the Corporation and its affiliates. The offering is expected to close on or about August 10, 2012.

TransAlta was recently downgraded to P-3 by S&P and the shelf registered preferreds were downgraded to (P)Ba2 by Moody’s. DBRS has them at Pfd-3, Review-Developing.

Update, 2012-8-3: Provisionally rated Pfd-3 by DBRS.

Birchcliff Energy has announced:

that it has entered into an agreement with a syndicate of underwriters, which have agreed to purchase, on a bought deal basis, 1.6 million preferred units (“Preferred Units”) at a price of $25.00 per Preferred Unit, for total gross proceeds of $40 million (the “Offering”).

Each Preferred Unit will consist of one Cumulative 5-Year Rate-Reset Preferred Share, Series A (the “Series A Preferred Shares”) and 3 common share purchase warrants issued by Birchcliff (the “Warrants”), with each Warrant providing the right to purchase one (1) common share in the capital of Birchcliff (“Common Shares”) at an exercise price of $8.30 per Common Share for a period of two years. The syndicate of underwriters is co-led by GMP Securities L.P., Cormark Securities Inc. and National Bank Financial Inc., and includes HSBC Securities (Canada) Inc., Raymond James Ltd., Macquarie Group Ltd. and Peters & Co. Limited.

The Series A Preferred Shares will pay cumulative dividends of $2.00 per share per annum, payable quarterly if, as and when declared by Birchcliff’s board of directors (with the first quarterly dividend to be paid on September 30, 2012 (or the next business day)), for the initial five year period ending September 30, 2017. The dividend rate will be reset on September 30, 2017 and every five years thereafter at a rate equal to the five-year Government of Canada bond yield plus 6.83 per cent. The Series A Preferred Shares will be redeemable by the issuer on or after September 30, 2017, in accordance with their terms.

Holders of the Series A Preferred Shares will have the right, at their option, to convert their shares into Cumulative Floating Rate Preferred Shares, Series B (the “Series B Preferred Shares”) subject to certain conditions, on September 30, 2017 and on September 30 every five years thereafter. Holders of the Series B Preferred Shares will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada Treasury Bill yield plus 6.83 per cent, if, as and when declared by Birchcliff’s board of directors.

The Preferred Units will be offered for sale to the public in each of the provinces of Canada other than Quebec pursuant to a short form prospectus to be filed with Canadian securities regulatory authorities in such provinces. The Offering is scheduled to close on or about August 8, 2012, subject to certain conditions, including obtaining all necessary regulatory approvals.

The market said Supersize me!

Birchcliff has increased the size of its previously announced bought deal preferred unit offering to $50 million, from $40 million. Birchcliff will issue a total of two (2) million preferred units (“Preferred Units”) at a price of $25.00 per Preferred Unit, for total gross proceeds of $50 million (the “Offering”).

This issue will not be tracked by HIMIPref™

• It is too small
• It has no credit rating. As I have noted before, I am very much in favour of issues having credit ratings – not because I can’t take my own view and not because I worship the credit rating agencies, but because a credit rating and downgrade thereof serves as a public flashpoint that serves to increase pressure on the company to take drastic measures, if necessary, when things go wrong.

Thanks to Assiduous Reader mpisni for bringing this issue to my attention.

Enbridge Inc. has announced:

that it has entered into an agreement with a group of underwriters to sell 10 million cumulative redeemable preference shares, series N (the “Series N Preferred Shares”) at a price of $25.00 per share for distribution to the public. Closing of the offering is expected on July 17, 2012.

The holders of Series N 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 December 1, 2018. The first quarterly dividend payment date is scheduled for December 1, 2012. The dividend rate will reset on December 1, 2018 and every five years thereafter at a rate equal to the sum of the then five-year Government of Canada bond yield plus 2.65 per cent. The Series N Preferred Shares are redeemable by Enbridge, at its option, on December 1, 2018 and on December 1 of every fifth year thereafter.

The holders of Series N Preferred Shares will have the right to convert their shares into cumulative redeemable preference shares, series O (the “Series O Preferred Shares”), subject to certain conditions, on December 1, 2018 and on December 1 of every fifth year thereafter. The holders of Series O 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 2.65 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 two million Series N 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 RBC Capital Markets, CIBC, Scotiabank, and TD Securities Inc.

This will join the other Enbridge FixedResets:

• ENB.PR.B, 4.00%+240
• ENB.PR.D, 4.00%+237
• ENB.PR.F, 4.00%+251
• ENB.PR.H, 4.00%+212

All of these were bid in the neighborhood of 25.50 on July 6.

Great-West Lifeco has announced that it:

has today entered into an agreement with a syndicate of underwriters co-led by BMO Capital Markets, RBC Capital Markets and Scotiabank, under which the underwriters have agreed to buy, on a bought deal basis, 6,000,000 Non-Cumulative First Preferred Shares, Series Q (the “Series Q Shares”) from Lifeco for sale to the public at a price of $25.00 per Series Q Share, representing aggregate gross proceeds of $150 million.

Lifeco has granted the underwriters an underwriters’ option to purchase an additional 2,000,000 Series Q Shares at the same offering price. Should the underwriters’ option be fully exercised, the total gross proceeds of the Series Q Shares offering will be $200 million.

The Series Q Shares will yield 5.15% per annum, payable quarterly, as and when declared by the Board of Directors of the Company. The Series Q Shares will not be redeemable prior to September 30, 2017. On or after September 30, 2017, the Company may, on not less than 30 nor more than 60 days’ notice, redeem the Series Q Shares in whole or in part, at the Company’s option, by the payment in cash of $26.00 per Series Q Share if redeemed prior to September 30, 2018, of $25.75 per Series Q Share if redeemed on or after September 30, 2018 but prior to September 30, 2019, of $25.50 per Series Q Share if redeemed on or after September 30, 2019 but prior to September 30, 2020, of $25.25 per Series Q Share if redeemed on or after September 30, 2020 but prior to September 30, 2021 and of $25.00 per Series Q Share if redeemed on or after September 30, 2021, in each case together with all declared and unpaid dividends up to but excluding the date fixed for redemption.

The Series Q Shares offering is expected to close on July 6, 2012. The net proceeds will be used for general corporate purposes and to augment Lifeco’s current liquidity position.

This will be characterized in the HIMIPref™ database as a DeemedRetractible; which is to say, analysis will assume a maturity 2022-1-31 at 25.00, although this is not in the formal terms of the issue.

Canadian Utilities 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. and Scotiabank. The underwriters have agreed to buy 6,000,000 4.90% Cumulative Redeemable Second Preferred Shares Series BB at a price of $25.00 per share for aggregate gross proceeds of $150 million.

The Series BB 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 $1.225 per share, to yield 4.90% annually. On or after September 1, 2017, the Corporation may redeem the Series BB 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, 2017, at $25.75 per share if redeemed during the 12 months commencing September 1, 2018, at $25.50 per share if redeemed during the 12 months commencing September 1, 2019, at $25.25 per share if redeemed during the 12 months commencing September 1, 2020, and at $25.00 per share if redeemed on or after September 1, 2021.

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 July 5, 2012.

Canadian Utilities Limited also announced today that it will redeem on July 19, 2012 all of its outstanding Cumulative Redeemable Second Preferred Shares Series W at a price of $25.00 per share plus accrued and unpaid dividends per share. The $150 million aggregate cost of redemption will be funded from the net proceeds of the Series BB Preferred Share offering and cash.

This news release does not constitute an offer to sell securities, nor is it a solicitation of an offer to buy securities, in any jurisdiction. All sales will be made through registered securities dealers in jurisdictions where the offering has been qualified for distribution.

The redemption announcement for CU.PR.A (Series W) got its own post.

This is rather an unusual situation, in that they announced a different series of 4.90% Straights last month. That new issue, CU.PR.D, settled today, and also got its own post. The call schedules are identical.

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 4.90% Cumulative Redeemable Second Preferred Shares Series AA at a price of $25.00 per share for aggregate gross proceeds of $150 million.

The Series AA 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 $1.225 per share, to yield 4.90% annually. On or after September 1, 2017, the Corporation may redeem the Series AA 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, 2017, at $25.75 per share if redeemed during the 12 months commencing September 1, 2018, at $25.50 per share if redeemed during the 12 months commencing September 1, 2019, at $25.25 per share if redeemed during the 12 months commencing September 1, 2020, and at $25.00 per share if redeemed on or after September 1, 2021.

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 June 18, 2012.

Emera Inc. has announced:

that it will issue ten million Cumulative Rate Reset First Preferred Shares, Series C (the “Series C Preferred Shares”) at a price of $25.00 per share, for aggregate gross proceeds of $250 million on a bought deal basis to a syndicate of underwriters in Canada led by Scotiabank, RBC Capital Markets and TD Securities Inc.

The holders of the Series C Preferred Shares will be entitled to receive fixed cumulative dividends at an annual rate of $1.0250 per share, payable quarterly, as and when declared by the board of directors of Emera, yielding 4.10 per cent per annum, for the initial six-year period ending on August 15, 2018. The first of such dividends, if declared, shall be payable on August 15, 2012, and shall be $0.1938 per Series C Preferred Share, based on the anticipated closing of the offering on June 7, 2012. The dividend rate will be reset on August 15, 2018 and every five years thereafter at a rate equal to the sum of the then five-year Government of Canada bond yield plus 2.65 per cent. The Series C Preferred Shares are redeemable by Emera, at its option, on August 15, 2018 and on August 15th of every fifth year thereafter.

The holders of Series C Preferred Shares will have the right to convert their shares into Cumulative Floating Rate First Preferred Shares, Series D (the “Series D Preferred Shares”), subject to certain conditions, on August 15, 2018 and on August 15 of every fifth year thereafter. The holders of the Series D Preferred Shares will be entitled to receive quarterly floating rate cumulative dividends, as and when declared by the board of directors of Emera, at a rate equal to the sum of the then 90-day Government of Canada treasury bill rate plus 2.65 per cent.

The net proceeds of the offering will be used for general corporate purposes.

The Series C Preferred Shares will be offered to the public in Canada by way of prospectus supplement to an amended and restated short form base shelf prospectus dated February 18, 2011 (amending and restating the short form base shelf prospectus of Emera dated May 19, 2010).