First National Financial Corporation has announced (although not yet on their website):
that it intends to redeem for cash all of its outstanding Class A Preference Shares, Series 1 (the “Series 1 Preference Shares”) and outstanding Class A Preferences Shares, Series 2 (the “Series 2 Preference Shares” and together with the Series 1 Preference Shares, the “Preferred Shares”) on March 31, 2026 at a redemption price equal to $25.00 per share, together with all accrued and unpaid dividends up to but excluding the date of redemption (collectively, the “Aggregate Redemption Price”), less any tax required to be deducted and withheld by the Company. The Company also announced today that shareholders of record at the close of business on March 16, 2026 will be entitled to receive the final quarterly dividend payable on March 31, 2026 of $0.180938 per Series 1 Preference Share and $0.264329 per Series 2 Preference Share.
Formal notice will be delivered to the registered holders of the Preferred Shares in accordance with the terms of the Preferred Shares contained in the Company’s articles. Non-registered holders of Preferred Shares should contact their broker or other intermediary for information regarding the redemption process for the Preferred Shares in which they hold a beneficial interest.
After the Preferred Shares are redeemed, holders of Preferred Shares will cease to be entitled to dividends and will not be entitled to exercise any rights as holders other than to receive the Aggregate Redemption Price.
Following the redemption on March 31, 2026, the Preferred Shares will be delisted from and no longer trade on the Toronto Stock Exchange (“TSX”).
The market was surprised by the news, with FN.PR.A up 7.3% today and FN.PR.B up 6.0%.
FN.PR.A is a FixedReset, 4.65%+207, that commenced trading 2011-1-25 after being announced 2011-1-17. Notice of extension was given in February, 2016 and the issue reset to 2.79%. I recommended against conversion, but there was 28% conversion to the FloatingReset, FN.PR.B. Notice of the second extension was given in February, 2021. The issue reset at 2.895% in 2021 and there was a 2% net conversion to the FixedReset.
FN.PR.B is a FloatingReset, Bills+207, that arose via a partial conversion from the FixedReset, FN.PR.A, in 2016.
Thanks to Assiduous Reader Hrseymour for bringing this to my attention!