ALA.PR.K Firm On Excellent Volume

AltaGas Ltd. has announced:

that it has closed its previously announced public offering of 12,000,000 Cumulative 5-Year Minimum Rate Reset Redeemable Preferred Shares, Series K (the “Series K Preferred Shares”), at a price of $25.00 per Series K Preferred Share (the “Offering”) for aggregate gross proceeds of $300 million.

The Offering was first announced on February 13, 2017 when AltaGas entered into an agreement with a syndicate of underwriters co-led by CIBC Capital Markets, BMO Capital Markets, National Bank Financial Inc. and Scotiabank.

Net proceeds will be used to reduce existing indebtedness and for general corporate purposes.

The Series K Preferred Shares will commence trading today on the Toronto Stock Exchange (“TSX”) under the symbol ALA.PR.K.

ALA.PR.K is a FixedReset, 5.00%+380M500, announced 2017-2-13. It will be tracked by HIMIPref™ but relegated to the Scraps subindex on credit concerns.

The issue traded 1,402,187 shares today in a range of 25.01-10 before closing at 25.09-11, 6×10. Vital statistics are:

Maturity Type : Limit Maturity
Maturity Date : 2047-02-22
Maturity Price : 23.18
Evaluated at bid price : 25.09
Bid-YTW : 4.90 %

Implied Volatility analysis indicates that while the new issue is reasonably a little cheap, a cheaper alternative for this name is available with ALA.PR.A:

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