Month: March 2025

Brookfield Corporation has announced:

that it has determined the fixed dividend rate on its Cumulative Class A Preference Shares, Series 38 (the “Series 38 Shares”) (TSX: BN.PF.E) for the five years commencing April 1, 2025 and ending March 31, 2030.

If declared, the fixed quarterly dividends on the Series 38 Shares during the five years commencing April 1, 2025 will be paid at an annual rate of 5.185% ($0.3240625 per share per quarter).

Holders of Series 38 Shares have the right, at their option, exercisable not later than 5:00 p.m. (Toronto time) on March 17, 2025, to convert all or part of their Series 38 Shares, on a one-for-one basis, into Cumulative Class A Preference Shares, Series 39 (the “Series 39 Shares”), effective March 31, 2025. The quarterly floating rate dividends on the Series 39 Shares will be paid at an annual rate, calculated for each quarter, of 2.55% over the annual yield on three-month Government of Canada treasury bills. The actual quarterly dividend rate in respect of the April 1, 2025 to June 30, 2025 dividend period for the Series 39 Shares will be 1.34331% (5.388% on an annualized basis) and the dividend, if declared, for such dividend period will be $0.3358275 per share, payable on June 30, 2025.

Holders of Series 38 Shares are not required to elect to convert all or any part of their Series 38 Shares into Series 39 Shares.

As provided in the share conditions of the Series 38 Shares, (i) if Brookfield determines that there would be fewer than 1,000,000 Series 38 Shares outstanding after March 31, 2025, all remaining Series 38 Shares will be automatically converted into Series 39 Shares on a one-for-one basis effective March 31, 2025; and (ii) if Brookfield determines that there would be fewer than 1,000,000 Series 39 Shares outstanding after March 31, 2025, no Series 38 Shares will be permitted to be converted into Series 39 Shares. There are currently 7,906,132 Series 38 Shares outstanding.

The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series 39 Shares effective upon conversion. Listing of the Series 39 Shares is subject to Brookfield fulfilling all the listing requirements of the TSX.

They later announced:

that after having taken into account all election notices received by the deadline for the conversion of its Cumulative Class A Preference Shares, Series 38 (the “Series 38 Shares”) (TSX: BN.PF.E) into Cumulative Class A Preference Shares, Series 39 (the “Series 39 Shares”), there were 42,035 Series 38 Shares tendered for conversion, which is less than the one million shares required to give effect to conversion into Series 39 Shares. Accordingly, there will be no conversion of Series 38 Shares into Series 39 Shares and holders of Series 38 Shares will retain their Series 38 Shares.

BN.PF.E was issued as BAM.PF.E, a FixedReset, 4.40%+255, that commenced trading 2014-3-13 after being announced 2014-3-6. It reset to 3.568% effective 2020-4-1. I made a preliminatry recommendation not to convert and there was no conversion. The ticker changed to BN.PF.E in late 2022. The issue is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.

Aimia Inc. announced (on 2025-2-26):

y that it does not intend to exercise its right to redeem its currently outstanding Cumulative Rate Reset Preferred Shares (“Series 1 Shares”) (TSX: AIM.PR.A) on March 31, 2025.

The Company also announced that due to the results of its Substantial Issuer Bid completed on January 30, 2025, where an aggregate of 4,528,157 Series 1 Shares were tendered in consideration for 9.75% senior unsecured notes, there are currently 606,658 Series 1 Shares outstanding. In accordance with the terms of the Series 1 Shares, as there are less than 1,000,000 Series 1 Shares outstanding, none of the Series 1 Shares will be eligible for conversion into Cumulative Floating Rate Preferred Shares, Series 2 (“Series 2 Shares”) on March 31, 2025 (since any such conversion would result in less than 1,000,000 Series 2 Shares being outstanding).

As a result of the foregoing, the quarterly dividend rate for Series 1 shares will be reset for the 5-year period from March 31, 2025 to March 30, 2030 based on the sum of the 5-year Government of Canada bond yield on the 30th day prior to start of the fixed rate period plus 3.75%.

The reset dividend rate applicable to the Series 1 Shares will be announced by a news release on or about
March 3, 2025.

Holders of Series 1 Shares are entitled to receive quarterly fixed cumulative preferential cash dividends as
and when declared by Aimia’s Board of Directors.

On 2025-3-3, they announced:

the applicable dividend rates for its Cumulative Rate Reset Preferred Shares, Series 1 (the “Series 1 Shares”) further to its February 26, 2025 notice and announcement that it will not exercise its right to redeem all or any part of the outstanding Series 1 Shares.

As announced in the Company’s press release dated February 26, 2025, none of the Series 1 Shares will be eligible for conversion into Cumulative Floating Rate Preferred Shares, Series 2 (“Series 2 Shares”) on March 31, 2025, as there are less than 1,000,000 Series 1 Shares outstanding (since any such conversion would result in less than 1,000,000 Series 2 Shares being outstanding).

Holders of the Series 1 Shares will be entitled to receive fixed, cumulative, preferential cash dividends, payable quarterly, as and when declared by the Company’s Board of Directors. The annual dividend rate for the five-year period from and including March 31, 2025 to, but excluding, March 31, 2030 will be 6.281% being equal to the five-year Government of Canada bond yield of 2.531% plus 3.75%, as determined in accordance with the rights, privileges, restrictions and conditions attaching to the Series 1 Shares.

Holders of Series 1 Shares as of the applicable record date remain eligible to receive dividends on their Series 1 Shares, as and when declared by the Board of Directors of Aimia, for the period from and including December 31, 2024 to, but excluding, March 31, 2025 at the current annual dividend rate of 4.802%.

Aimia recently completed a substantial issuer bid to purchase for cancellation 7,889,931 preferred shares, of which 4,528,157 were Series 1 preferred shares, in consideration for 9.75% senior unsecured notes (“2030 Notes”). Based on the number of Preferred Shares validly tendered and 2030 Notes issued in consideration, Aimia will generate approximately $6.4 million in annual cash savings when comparing the annual preferred dividends and Part VI.1 tax to the annual cash coupon interest payments. Under IFRS, Aimia expects to record a $53.7 million gain on the transaction, based on the exchange value of the 2030 Notes and the carrying value of the Preferred Shares exchanged.

AIM.PR.A is a FixedReset, 4.50%+375, assigned to the Scraps-FixedReset (Discount) subindex. It commenced trading as AER.PR.A with an initial dividend rate of 6.50% on 2010-1-20 after being announced 2010-1-12. AIM.PR.A changed its ticker from AER.PR.A in October, 2011. The first extension was reported on PrefBlog and the reset to 4.50% was announced 2015-3-2. I recommended against conversion. There was a 43% conversion to the FloatingReset, AIM.PR.B in 2015. The 2020 extension was announced 2020-2-25. AIM.PR.A will reset to 4.802% effective 2020-3-31; at that time I opined that a decision on whether to convert or hold should be made according to each investor’s circumstances. There was a complete conversion to the FixedReset.