Quadravest has announced:
Dividend 15 Split Corp. II (the “Company”) invests
in a high-quality portfolio consisting of 15 leading Canadian dividend-yielding stocks. The top five holdings currently held in the portfolio are as follows: Manulife Financial Corp., Canadian Imperial Bank of Commerce, Royal Bank of Canada, National Bank of Canada and Sun Life Financial Inc.The recent extension of the Company’s termination date included a retraction right for Class A shareholders and Preferred shareholders. The Company will not require a rebalance of shares and all retraction rights have been satisfied.
The Company may use the normal course issuer to repurchase Class A shares at or below intrinsic value. The current intrinsic value exceeds $7.00 per share.
As previously announced, the annual dividend rate for the Preferred Shares has been set at 7.00% for the fiveyear renewal period effective December 1, 2024. The dividend policy for the Class A Shares will remain at the current targeted rate of $0.10 per share monthly, or $1.20 per annum.
Some details would be appreciated! Like, how many shares of each class were retracted? I wouldn’t expect many preferreds got retracted, given that the issue has been trading over par for the past three months, but what about the Capital Units? Inquiring minds want to know!
The terms of the extension were reported on PrefBlog.
Thanks to Assiduous Reader IrateAR for bringing this to my attention!
DF UNITS OUTSTANDING
I track the number of units outstanding of several Split Share Funds. I have done this for several years since Quadravest stopped reporting the number of units in their monthly Fund Updates. In particular I own DF.PR.A shares.
For DF, from the Fund Updates published monthly, I calculate:
Dec31 2019 13.97 million units (as reported by the Fund Update and rounding to 2 decimal places)
Dec31 2020 13.85 million units (as reported by the Fund Update and rounding to 2 decimal places)
Dec31 2021 25.86 million units (as calculated, the Fund Update stopped reporting the units Nov 2021)
Dec31 2022 31.11 million units
Dec31 2023 24.83 million units
Dec31 2024 21.37 million units
So Quadravest has managed to grow DF by 7.40 million units over 5 years.
The data also shows that on Nov29 2024 there were 24.83 million units outstanding. So there was a net retraction of 3.46 million units during the month. This is at the time of the 5 year retraction privilege.
How was this accomplished?
Did investors in DF put up 3.46 million shares for retraction and did Quadravest then buy shares of DF.PR.A in the open market to pair with these for cancelling whole units? Or did investors supply whole units for retraction?
The DF fund often suffers monthly reductions in the units outstanding not related to the 5 year retraction privilege. For example, at the end of August 2023 there were 31.07 Million units outstanding, while at the end of September 2023 there were 25.02 million units outstanding, for a reduction in the units outstanding go 6.05 million units. Is this related to the monthly retraction privilege? Is someone attacking the DF fund? Is there some advantage to be gained at certain times by buying units at the market price and forcing Quadravest to redeem them? I do not know what is going on and my guesses could be wrong.
See Some SplitShare “Units Outstanding” Data for details.