Brompton Funds has announced:
Global Dividend Growth Split Corp. (the “Fund”) is
pleased to announce its intention to complete a stock split of its class A shares (the “Share Split”) due to the Fund’s strong performance. Class A shareholders of record at the close of business on May 11, 2026 will receive 15 additional class A shares for every 100 class A shares held, pursuant to the Share Split. The Share Split is subject to the approval of the Toronto Stock Exchange (the “TSX”).Class A shareholders will continue to receive the same regular monthly non-cumulative cash distributions (currently $0.10 per class A share) following the Share Split. As a result, the total dollar amount of distributions to be paid to class A shareholders is expected to increase by approximately 15%. The Fund provides a distribution reinvestment plan (“DRIP”), on a commission-free basis for class A shareholders that wish to reinvest distributions and realize the benefits of compound growth. Class A shareholders can enroll in the DRIP program by contacting their investment advisor.
Since inception on June 15, 2018 to March 31, 2026, the class A shares have delivered a 13.5% per annum total return based on net asset value, outperforming the MSCI World High Dividend Yield Total Return Index by 5.2% per annum and the MSCI World Total Return Index by 2% per annum.(1) Since inception, class A shareholders have received cash distributions of $9.35 per share.
Following the completion of the Share Split, the preferred shares of the Fund are expected to have downside protection from a decline in the value of the Fund’s portfolio of approximately 54%.(2)
The class A shares are expected to commence trading on an ex-split basis at the opening of trading on May 11, 2026. No fractional class A shares will be issued and the number of class A shares each holder shall receive will be rounded down to the nearest whole number. The Share Split is a non-taxable event.
The Fund is also pleased to announce that the preferred share distribution rate for the extended term from July 1, 2026 to June 27, 2031 will be $0.62 per preferred share per annum (6.2% on the par value of $10.00) payable quarterly. This represents a pre-tax interest equivalent yield of 8.1% per annum.
(3) The preferred share distribution rate for the extended term is based on current market rates for preferred shares with similar terms.The term extension offers preferred shareholders the opportunity to continue enjoying preferential cash dividends until June 27, 2031. Since inception on June 15, 2018 to March 31, 2026, the preferred shares of the Fund have delivered a 5.1% per annum return(1)
.
The Fund invests in a diversified portfolio (the “Portfolio”) of equity securities of large capitalization global dividend growth companies selected by Brompton Funds Limited (the “Manager”), the manager of the Fund. In order to qualify for inclusion in the Portfolio, at the time of investment and at the time of each periodic reconstitution and/or rebalancing of the Portfolio, each global dividend growth company included in the Portfolio must (i) have a market capitalization of at least $10 billion, and (ii) have a history of dividend growth or, in the Manager’s view, have high potential for future dividend growth.In connection with the extension, shareholders who do not wish to continue their investment in the Fund may retract their preferred shares or class A shares on June 30, 2026 pursuant to a special retraction right and receive a retraction price that is calculated in the same way that such price would be calculated if the Fund were to terminate on June 30, 2026. Pursuant to this option, the retraction price may be less than the market price if the security is trading at a premium to net asset value. To exercise this retraction right, shareholders must provide notice to their investment dealer by May 29, 2026 at 5:00 p.m. (Toronto time). Alternatively, shareholders may sell their preferred shares and/or class A shares through their securities dealer for the market price at any time, potentially at a higher price than would be achieved through retraction, or shareholders may take no action and continue to hold their shares.
The extension was previously reported on PrefBlog. The previous distribution rate was 5.0%.
Thanks to Assiduous Reader Yomgui for bringing this to my attention!