PrefBlog

Manulife Financial Corp has announced (although not yet on their website):

a Canadian public offering of Non-cumulative Rate Reset Class 1 Shares Series 13 (“Series 13 Preferred Shares”). Manulife will issue 8 million Series 13 Preferred Shares priced at $25 per share to raise gross proceeds of $200 million. The offering will be underwritten by a syndicate of investment dealers co-led by Scotia Capital Inc. and RBC Capital Markets and is anticipated to qualify as Tier 1 capital for Manulife. The expected closing date for the offering is June 21, 2013. Manulife intends to file a prospectus supplement to its July 18, 2012 base shelf prospectus in respect of this issue.

Holders of the Series 13 Preferred Shares will be entitled to receive a non-cumulative quarterly fixed dividend yielding 3.80 per cent annually, as and when declared by the Board of Directors of Manulife, for the initial period ending September 19, 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 2.22 per cent.

Holders of Series 13 Preferred Shares will have the right, at their option, to convert their shares into Non-cumulative Rate Reset Class 1 Shares Series 14 (“Series 14 Preferred Shares”), subject to certain conditions, on September 19, 2018 and on September 19 every five years thereafter. Holders of the Series 14 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 2.22 per cent.

The net proceeds from the offering will be utilized for general corporate purposes, including future refinancing requirements.

“Our financing activities take into account future refinancing needs. We have taken the opportunity to issue preferred shares with favourable terms,” said Senior Executive Vice President and Chief Financial Officer, Steve Roder.

This entry was posted on Monday, June 17th, 2013 at 5:11 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.