Category: New Issues

Canaccord Financial Inc. has announced:

that it has agreed to issue 4,000,000 Cumulative 5-Year Rate Reset First Preferred Shares, Series C (the “Series C Preferred Shares”) to a syndicate of underwriters led by CIBC, Canaccord Genuity Corp. and RBC Capital Markets for distribution to the public. The Series C Preferred Shares will be issued at a price of $25.00 per share for aggregate gross proceeds of $100 million. Holders of the Series C Preferred Shares will be entitled to receive fixed, cumulative, preferential dividends payable quarterly, if, as and when declared by the board of directors of Canaccord, and yielding 5.75% annually for the initial period ending on June 30, 2017. Thereafter, the dividend rate will be reset every five years at a rate equal to the five year Government of Canada bond yield plus 4.03%.

Holders of Series C Preferred Shares will have the right, at their option, to convert any or all of their shares into an equal number of Cumulative Floating Rate First Preferred Shares, Series D (the “Series D Preferred Shares”), subject to certain conditions, on June 30, 2017 and on June 30th every five years thereafter. Holders of the Series D Preferred Shares will be entitled to receive floating rate, cumulative, preferential dividends payable quarterly, if, as and when declared by the board of directors of Canaccord, at a rate equal to the three-month Government of Canada Treasury Bill yield plus 4.03%.

Canaccord has also granted the underwriters an option to purchase up to an additional 600,000 Series C Preferred Shares, on the same terms and conditions as the offering, exercisable in whole or in part, for a period of 30 days from the closing date of the offering. If this option is exercised in full, the total gross proceeds to Canaccord will be $115 million.

The net proceeds of the offering will be used to reduce outstanding borrowings under the $150 million senior secured credit facility (the “Acquisition Credit Facility”) entered into by the Company, as borrower, and provided by Canadian Imperial Bank of Commerce, as lender. The Acquisition Credit Facility was entered in order to fund a portion of the cash consideration for the Company’s previously announced acquisition of Collins Stewart Hawkpoint plc, which closed on March 21, 2012. The offering is expected to close on or about April 10, 2012, subject to certain conditions, including Toronto Stock Exchange approval, as well as other conditions set forth in an underwriting agreement to be entered into between Canaccord and the underwriters.

The Series C Preferred Shares will be offered for sale to the public in each of the provinces and territories of Canada by way of a short form prospectus to be filed with Canadian securities regulatory authorities in all provinces of Canada.

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 H (the “Series H Preferred Shares”) at a price of $25.00 per share for distribution to the public. Closing of the offering is expected on March 29, 2012.

The holders of Series H 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, 2018. The first quarterly dividend payment date is scheduled for September 1, 2012. The dividend rate will reset on September 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 2.12 per cent. The Series H Preferred Shares are redeemable by Enbridge, at its option, on September 1, 2018 and on September 1 of every fifth year thereafter.

The holders of Series H Preferred Shares will have the right to convert their shares into cumulative redeemable preference shares, series I (the “Series I Preferred Shares”), subject to certain conditions, on September 1, 2018 and on September 1 of every fifth year thereafter. The holders of Series I 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 2.12 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 H 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, Scotia Capital Inc., and TD Securities Inc.

Update, 2012-3-22: Pfd-2(low), Stable Trend, from DBRS.

Fairfax Financial Holdings has announced:

that it will issue in Canada 8 million Preferred Shares, Series K at a price of $25.00 per share, for aggregate gross proceeds of $200 million, on a bought deal basis to a syndicate of Canadian underwriters.

Holders of the Preferred Shares, Series K will be entitled to receive a cumulative quarterly fixed dividend yielding 5.00% annually for the initial five year period ending March 31, 2017. Thereafter, the dividend rate will be reset every five years at a rate equal to the then current 5-year Government of Canada bond yield plus 3.51%.

Holders of Preferred Shares, Series K will have the right, at their option, to convert their shares into Preferred Shares, Series L, subject to certain conditions, on March 31, 2017, and on March 31 every five years thereafter. Holders of the Preferred Shares, Series K will be entitled to receive cumulative quarterly floating dividends at a rate equal to the then current three-month Government of Canada Treasury Bill yield plus 3.51%.

Fairfax has granted the underwriters an option, exercisable in whole or in part at any time up to 9:00 am on the date that is two business days prior to the closing date, to purchase up to an additional 2 million Preferred Shares, Series K at the same offering price for additional gross proceeds of $50 million.

Fairfax intends to use the net proceeds of the offering to augment its cash position, to increase short term investments and marketable securities held at the holding company level, to retire outstanding debt and other corporate obligations from time to time, and for general corporate purposes. The offering is expected to close on or about March 21, 2012.

Fairfax intends to file a prospectus supplement to its short form base shelf prospectus dated December 10, 2010, in respect of this offering with the applicable Canadian securities regulatory authorities. Details of this offering will be set out in the prospectus supplement, which will be available on the SEDAR website for the Company at www.sedar.com.

Update, 2012-3-15: Rated P-3 / BB by S&P.

E-L Financial Corporation Limited has announced:

that it has entered into an agreement with Scotia Capital Inc. and TD Securities Inc., on behalf of a syndicate of underwriters, under which the underwriters have agreed to buy, on a bought deal basis, 4,000,000 First Preference Shares, Series 3 (the “Series 3 Preference Shares”). The total gross proceeds of the financing will be $100.0 million.

The Series 3 Preference Shares will be priced at $25.00 per share and will pay non-cumulative quarterly dividends that will yield 5.50% per annum. The net proceeds of the offering will be added to the Corporation’s capital base to supplement the Corporation’s financial resources and used for general corporate purposes. The transaction is subject to the receipt of all necessary regulatory and stock exchange approvals. The offering is expected to close on or about April 2, 2012.

Other provisions of interest are the redemption schedule (redeemable at 26.00 commencing April 17, 2017; redemption price decreases by 0.25 every April 17 until 2021-4-17 redeemable at 25.00 thereafter) and the fact that the redemption price may be satisfied by issue of common shares priced at the greater of $1.00 and 95% of market.

The forced conversion right means that the issue will be assigned to the PerpetualPremium or PerpetualDiscount index, not the DeemedRetractible index, as it is assumed that the conversion feature will satisfy the NVCC rules in the event that these are applied to insurance holding companies.

Brookfield Asset Management has announced:

that it has agreed to issue 10,000,000 Class A Preferred Shares, Series 32 on a bought deal basis to a syndicate of underwriters led by RBC Capital Markets, CIBC, Scotia Capital Inc. and TD Securities Inc. for distribution to the public. The Preferred Shares, Series 32 will be issued at a price of CDN$25.00 per share, for aggregate gross proceeds of CDN$250,000,000. Holders of the Preferred Shares, Series 32 will be entitled to receive a cumulative quarterly fixed dividend yielding 4.50% annually for the initial period ending September 30, 2018. Thereafter, the dividend rate will be reset every five years at a rate equal to the 5-year Government of Canada bond yield plus 2.90%.

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 32 which, if exercised, would increase the gross offering size to CDN$300,000,000. The Preferred Shares, Series 32 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.

Proceeds will mostly be used to fund the redemption of BAM.PR.H.

Nexen Inc. has announced:

that we will issue 6 million cumulative redeemable class A rate reset preferred shares, series 2 (the “Series 2 Shares”) at a price of $25 per share, for aggregate gross proceeds of $150 million on a bought deal basis to a syndicate of underwriters co-led by TD Securities Inc. and Scotiabank.

Nexen has granted the underwriters an option, exercisable prior to closing, to purchase up to an additional 2 million Series 2 Shares at $25.00 per share. If the option is exercised in full, the aggregate gross proceeds would be $200 million.

The holders of the Series 2 Shares will be entitled to receive a fixed cumulative dividend at an annual rate of $1.25 per Series 2 Share, payable quarterly, yielding 5.0 per cent per annum, for the initial fixed rate period ending March 31, 2017. Thereafter, the dividend rate will be reset every five years at a rate equal to the then current five-year Government of Canada bond yield plus 3.59 per cent. The Series 2 Shares are redeemable by Nexen, at our option, on March 31, 2017, and on March 31 of every fifth year thereafter.

The holders of Series 2 Shares will have the right, at their option, to convert their shares into cumulative redeemable class A floating rate preferred shares, series 3 (the “Series 3 Shares”), subject to certain conditions, on March 31, 2017 and on March 31 every fifth year thereafter. The holders of the Series 3 Shares will be entitled to receive quarterly floating rate cumulative dividends at a rate equal to the sum of the then 90-day Government of Canada treasury bill rate plus 3.59 per cent.

The net proceeds of the offering may be used to reduce Nexen’s indebtedness, for capital expenditures and for general corporate purposes. The offering is anticipated to close on or about March 7, 2012, and is subject to the receipt of all necessary regulatory approvals.

The Series 2 Shares will be offered in Canada by way of prospectus supplement to the short form base shelf prospectus of Nexen dated June 15, 2011. The prospectus supplement will be filed with securities regulatory authorities in all provinces of Canada.

Update: Rated Pfd-3, Stable Trend, by DBRS

And thick and fast they came at last, and more and more and more!

Power Corporation has announced:

that it has agreed to issue 6,000,000 Non-Cumulative First Preferred Shares, Series G (the “Series G Shares”) on a bought deal basis, for gross proceeds of $150 million. The Series G Shares will be priced at $25.00 per share and will carry an annual dividend yield of 5.60%. Closing is expected on or about February 28, 2012. The issue will be underwritten by a syndicate of underwriters led by BMO Capital Markets, RBC Capital Markets and Scotiabank.

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

Proceeds from the issue will be used to supplement the Corporation’s financial resources and for general corporate purposes.

Manulife Financial has announced:

a Canadian public offering of Non-cumulative Rate Reset Class 1 Shares Series 7 (“Series 7 Preferred Shares”). Manulife will issue 10 million Series 7 Preferred Shares priced at $25 per share to raise gross proceeds of $250 million. The offering will be underwritten by a syndicate of investment dealers co-led by Scotia Capital Inc., RBC Capital Markets and TD Securities and is anticipated to qualify as Tier 1 capital for Manulife. The expected closing date for the offering is February 22, 2012. Manulife intends to file a prospectus supplement to its September 3, 2010 base shelf prospectus in respect of this issue.

“Our capital raising activity takes into account our expected refinancing requirements and recognizes that, while our capital position remains strong, there could be pressure on our common share price and bond spreads if our capital ratios decline. We see this action as prudent when faced with uncertain market and economic conditions.” said Donald Guloien, President and CEO of Manulife.

Holders of the Series 7 Preferred Shares will be entitled to receive a non-cumulative quarterly fixed dividend yielding 4.60% annually, as and when declared by the Board of Directors of Manulife, for the initial period ending March 19, 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 3.13%.

Holders of Series 7 Preferred Shares will have the right, at their option, to convert their shares into Non-cumulative Rate Reset Class 1 Shares Series 8 (“Series 8 Preferred Shares”), subject to certain conditions, on March 19, 2017 and on March 19 every five years thereafter. Holders of the Series 8 Preferred Shares will be entitled to receive non-cumulative quarterly floating dividends, as and when declared by the Board of Directors of Manulife, at a rate equal to the three-month Government of Canada Treasury Bill yield plus 3.13%.

The net proceeds from the offering will be utilized for general corporate purposes, which may include investments in subsidiaries.

Manulife’s Canadian life insurance company subsidiary, The Manufacturers Life Insurance Company, also intends to issue $500 million principal amount of fixed/floating subordinated debentures. The debentures will be fully and unconditionally guaranteed on a subordinated basis by Manulife.

I am fascinated by the rationale for the issue: “Our capital raising activity takes into account our expected refinancing requirements and recognizes that, while our capital position remains strong, there could be pressure on our common share price and bond spreads if our capital ratios decline. We see this action as prudent when faced with uncertain market and economic conditions.” said Donald Guloien, President and CEO of Manulife.

That seems like an incredibly defensive thing to say and to put into the official press release.

Update: Rating affirmed in the DBRS comment on year-end.

Update: Fitch rates the Series 5 prefs BBB.

Power Financial Corporation has announced:

that it has agreed to issue 6,000,000 Non-Cumulative First Preferred Shares, Series R (the “Series R Shares”) on a bought deal basis, for gross proceeds of $150 million. The Series R Shares will be priced at $25.00 per share and will carry an annual dividend yield of 5.50%. Closing is expected on or about February 23, 2012. The issue will be underwritten by a syndicate of underwriters led by BMO Capital Markets, RBC Capital Markets and Scotiabank.

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

Proceeds from the issue will be used to supplement the Corporation’s financial resources and for general corporate purposes.

Update: Have heard that this has been upsized to $250-million.

Update: Confirmed.