PrefBlog

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.

This entry was posted on Friday, March 9th, 2012 at 12:20 pm and is filed under New Issues. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.