PrefBlog

Sun Life Financial Inc. has announced

that after having taken into account all election notices received by the December 16, 2016 deadline for the conversion of its Class A Non-Cumulative Rate Reset Preferred Shares Series 12R (the “Series 12R Shares”) into Class A Non-Cumulative Floating Rate Preferred Shares Series 13QR (the “Series 13QR Shares”), there were 832,321 Series 12R Shares tendered for conversion, which is less than the one million shares required to give effect to conversions into Series 13QR Shares, meaning there will be no conversion of Series 12R Shares into Series 13QR Shares.

For the five-year period commencing on December 31, 2016 to but excluding December 31, 2021, holders of the Series 12R Shares will be entitled to receive non-cumulative preferential cash dividends on a quarterly basis, as and when declared by the Board of Directors of Sun Life Financial and subject to the Insurance Companies Act (Canada), based on an annual dividend rate of 3.806% per annum or $0.237875 per share per quarter, being equal to the sum of the 5-year Government of Canada Yield, as defined in the terms of the Series 12R Shares, on Thursday, December 1, 2016 plus 2.73%, as determined in accordance with the terms of those shares.

Subject to regulatory approval, Sun Life Financial may redeem the Series 12R Shares in whole or in part on December 31, 2021 and on the 31st of December every five years thereafter by the payment of an amount for each share so redeemed of $25.00, together with all declared and unpaid dividends to the date fixed for such redemption.

It will be recalled that the extension of SLF.PR.I was announced in November; the rate reset to 3.806% was announced on December 1 and I recommended holders not convert on December 9.

This entry was posted on Tuesday, December 20th, 2016 at 11:39 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.