PrefBlog

Quadravest has announced:

Dividend 15 Split Corp. II (the “Company”) is pleased to announce it has filed a preliminary short form prospectus in each of the provinces of Canada with respect to an offering of Preferred Shares and Class A Shares of the Company. The offering will be co-led by National Bank Financial Inc., CIBC, RBC Capital Markets and will also include TD Securities Inc., BMO Capital Markets, GMP Securities L.P., Canaccord Genuity Corp. and Raymond James.

The Preferred Shares will be offered at a price of $10.00 per Preferred Share to yield 5.25% on the issue price and the Class A Shares will be offered at a price of $8.75 per Class A Share to yield 13.71% on the issue price. The closing price on the TSX of each of the Preferred Shares and the Class A Shares on September 8, 2014 was $9.18 and $10.19, respectively.

Since inception of the Company, the aggregate dividends paid on the Preferred Shares have been $4.05 per share and the aggregate dividends paid on the Class A Shares have been $8.40 per share, for a combined total of $12.45. All distributions to date have been made in tax advantage eligible Canadian dividends or capital gains dividends.

The net proceeds of the secondary offering will be used by the Company to invest in an actively managed portfolio of dividend-yielding common shares which includes each of the 15 Canadian companies listed below:

Bank of Montreal	Enbridge Inc.	TELUS Corporation
The Bank of Nova Scotia	Manulife Financial Corp.	Thomson-Reuters Corporation
BCE Inc.	National Bank of Canada	The Toronto-Dominion Bank
Canadian Imperial Bank of Commerce	Royal Bank of Canada	TransAlta Corporation
CI Financial Corp.	Sun Life Financial Inc.	TransCanada Corporation

The Company’s investment objectives are:
Preferred Shares:
i. to provide holders of the Preferred Shares with fixed, cumulative preferential monthly cash dividends in the amount of $0.04375 per Preferred Share to yield 5.25% per annum on the original issue price; and
ii. on or about December 1, 2019, to pay the holders of the Preferred Shares the original issue price of those shares.

Class A Shares:
i. to provide holders of the Class A Shares with regular monthly cash dividends initially targeted to be $0.10 per Class A; and
ii. on or about termination, to pay the holders of Class A Shares at least the original issue price of those shares.

The sales period of this overnight offering will end at 9:00 a.m. (EST) on September 10, 2014.

Lynx-eyed readers will find some amusement in the fact that they got their closing prices for the two classes reversed, even when using the word “respectively”.

The NAVPU was 17.43 as of September 8, so the Capital Units are trading at a nice premium to intrinsic value, which provides a great deal of incentive for the fund to issue more units.

DF.PR.A was last mentioned on PrefBlog when they released their 2014 Semi-Annual Report. They also got bigger last March. DF.PR.A is tracked by HIMIPref™ but is relegated to the Scraps index on credit concerns.

Update, 2014-10-13: The offering was successful, according to a Quadravest announcement:

Dividend 15 Split Corp. II (the “Company”) is pleased to announce it has completed an overnight offering of 2,350,000 Preferred Shares and 2,350,000 Class A Shares. Total proceeds of the offering were $44.0 million, bringing the Company’s net assets to approximately $198.6 million. The shares will trade on the Toronto Stock Exchange under the existing symbols of DF.PR.A (Preferred shares) and DF (Class A shares).

The Preferred Shares were offered at a price of $10.00 per Preferred Share to yield 5.25% on the issue price and the Class A Shares were offered at a price of $8.75 per Class A Share to yield 13.71% on the issue price.

The offering was co-led by National Bank Financial Inc., CIBC, RBC Capital Markets and also included Scotia Capital Inc., TD Securities Inc., BMO Capital Markets, GMP Securities L.P., Canaccord Genuity Corp. and Raymond James.

The net proceeds of the secondary offering will be used by the Company to invest in an actively managed portfolio of dividend-yielding common shares which includes each of the 15 Canadian companies listed below:

Bank of Montreal	Enbridge Inc.	TELUS Corporation
The Bank of Nova Scotia	Manulife Financial Corp.	Thomson-Reuters Corporation
BCE Inc.	National Bank of Canada	The Toronto-Dominion Bank
Canadian Imperial Bank of Commerce	Royal Bank of Canada	TransAlta Corporation
CI Financial Corp.	Sun Life Financial Inc.	TransCanada Corporation

This entry was posted on Tuesday, September 9th, 2014 at 4:53 pm and is filed under Issue Comments. 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.