PrefBlog

On October 31, Timbercreek Asset Management announced:

5Banc Split Inc. (the “Company”) (TSX: FBS.B) (TSX: FBS.PR.C) announced today that, in accordance with the expiration of the term and as set out in the short form prospectus of the Company dated December 8, 2011 (the “Prospectus”), the Company will redeem all outstanding Class C Preferred Shares and Class B Capital Shares (collectively, the “Shares”) on December 15, 2016 (the “Redemption Date”) as scheduled and in accordance with their share provisions.

Prior to the Redemption Date, Timbercreek Asset Management Ltd. will sell the Company’s portfolio of common shares of Bank of Montreal, The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada and The Toronto-Dominion Bank to fund the redemptions. On the Redemption Date, in accordance with the share provisions for the Shares, holders of Class C Preferred Shares shall be entitled to receive a redemption price per share equal to the lesser of $10.00 and the Company’s unit value. Holders of Class B Capital Shares shall be entitled to receive a redemption price per share equal to the amount by which the unit value exceeds $10.00, or provided the holder tenders to the Company at least 20 business days prior to the Redemption Date a cash amount of $10.00 for each Class B Capital Share redeemed, such holder’s pro rata share of the Company’s portfolio of Bank of Montreal, The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada and The Toronto-Dominion Bank common shares plus (or minus) the pro rata share of the amount by which the value of the other assets of the Company exceed (or are less than) the liabilities of the Company as at the Redemption Date and the redemption value at the Class E Shares.

The Company was established to provide holders of Class C Preferred Shares with fixed cumulative preferential dividends, while providing holders of the Class B Capital Shares with a leveraged opportunity to participate in capital appreciation from a portfolio of common shares of Bank of Montreal, The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada and The Toronto-Dominion Bank. In that respect, as of August 15, 2016, the Class C Preferred Shares, since the reorganization on December 15, 2011, have generated a consistent 4.75% annual yield, with no change to the par value, while the Class B Capital Shares have delivered a net capital appreciation of 15.14% annualized, which compares to the underlying stock appreciation of 9.29%.

Information concerning 5Banc Split Inc. is available on our website at
http://www.timbercreek.com/investments/managed-companies/5banc-split-inc/overview

They have now announced (although not yet on their website):

5Banc Split Inc. (the “Company”) (TSX:FBS.B)(TSX:FBS.PR.C) announced today that in connection with the previously announced upcoming maturity of the fund on December 15, 2016, 1,077,529 Class C Preferred Shares and 1,077,529 Class B Capital Shares have been tendered for redemption on December 15, 2016. The redemption price paid for the Class C Preferred Shares will be $10.00 per Class C Preferred Share, and the redemption price for the Class B Capital Shares will be $27.51 per Class B Capital Share.

Holders of Class B Capital Shares tendered 136,043 Class B Capital Shares (representing approximately 12.63% of the outstanding Class B Capital Shares), together with a cash amount of $10.00 per Class B Capital Share tendered (together, a “5Banc Split Unit”), in exchange for the holder’s pro rata share of the Company’s shares of Toronto Dominion Bank, Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada and Bank of Montreal.

Payments of cash and delivery of the underlying portfolio shares owing to shareholders as a result of the final redemptions will be made by the Company on December 15, 2016.

FBS.PR.C has been tracked by HIMIPref™ but relegated to the Scraps subindex on volume concerns.

The issue was recently upgraded to Pfd-2(high) by DBRS. FBS.PR.C was issued to refund FBS.PR.B; the company sponsorship was sold by TD to Timbercreek in 2014.

This entry was posted on Tuesday, December 6th, 2016 at 12:30 am 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.