New Issue: BRF FixedReset 4.40%+294

Brookfield Renewable Energy Partners has announced:

that it has agreed to issue a total of 8,000,000 Class A Preference Shares, Series 3 (the “Series 3 Preferred Shares”) on a bought deal basis to a syndicate of underwriters in Canada led by TD Securities Inc., CIBC, RBC Capital Markets and Scotiabank. The Series 3 Preferred Shares will be issued at a price of CDN$25.00 per share, for aggregate gross proceeds of CDN$200,000,000. The Series 3 Preferred Shares are being issued through a wholly-owned subsidiary of, and are guaranteed by, Brookfield Renewable.

Holders of the Series 3 Preferred Shares will be entitled to receive fixed cumulative dividends at an annual rate of CDN$1.10 per share, payable quarterly. The Series 3 Preferred Shares will yield 4.4% annually at the issue price, for an initial period ending July 31, 2019 with the first dividend payment date scheduled for January 31, 2013, based on an anticipated closing date of October 11, 2012. Thereafter, the dividend rate will reset every five years at a rate equal to the then five-year Government of Canada Bond yield plus 2.94%. The Series 3 Preferred Shares are redeemable on or after July 31, 2019.

The holders of Series 3 Preferred Shares will have the right to convert their shares into Class A Preference Shares, Series 4 (the “Series 4 Preferred Shares”), subject to certain conditions, on July 31, 2019 and on July 31 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, at a rate equal to the then 90-day Government of Canada Treasury Bill yield plus 2.94%.

Brookfield Renewable 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 3 Preferred Shares at the issue price on the same terms, for additional gross proceeds of up to CDN$50,000,000.

Brookfield Renewable intends to use the net proceeds of the issue of Preferred Shares to repay outstanding indebtedness and for general corporate purposes. The offering of Series 3 Preferred Shares is expected to close on October 11, 2012.

The Series 3 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.

This will join BRF.PR.A, a FixedReset, 5.25%+262, currently trading slightly below $26.00.

2 Responses to “New Issue: BRF FixedReset 4.40%+294”

  1. […] is a FixedReset, 4.40%+294, announced October 1. This issue will be tracked by HIMIPref™, but assigned to the Scraps index on credit […]

  2. […] was issued as a FixedReset, 4.40%+294, that commenced trading 2010-10-11 after being announced 2010-10-1. The issue reset at 4.351% effective 2019-8-1. I recommended against conversion and there was no […]

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