Brompton Group announced (on 2026-8-11):
Dividend Growth Split Corp. (the “Fund”) is pleased to announce it is undertaking a treasury offering of class A and preferred shares (the “Class A Shares” and “Preferred Shares”, respectively) (the “Offering”).
The sales period for the Offering will end on Wednesday, August 12, 2026. The Offering is expected to close on or about August 19, 2026 and is subject to certain closing conditions including approval by the Toronto Stock Exchange (“TSX”).
The Class A Shares will be offered at a price of $8.75 per Class A Share for a distribution rate of 13.7% on the issue price.(1)(2) The Preferred Shares will be offered at a price of $10.75 per Preferred Share to yield 6.3%.(2) The closing price on the TSX for each of the Class A Shares and Preferred Shares on August 10, 2026 were $8.77 and $10.88, respectively. The Class A Share and Preferred Share Offering prices were determined so as to be non-dilutive to the most recently calculated net asset value (“NAV”) per unit of the Fund (calculated as at August 6, 2026), as adjusted for dividends and certain expenses to be accrued prior to or upon settlement of the Offering. The Offering is being led by RBC Capital Markets.
The investment objectives for the Class A Shares are to provide holders with regular monthly non-cumulative cash distributions targeted to be at least $0.10 per Class A Share and to provide holders of Class A Shares with the opportunity for growth in the net asset value per Class A Share. Over the past 10 years, the Class A Share has generated a 19.2% per annum return, significantly outperforming the S&P/TSX Composite Total Return Index by 6.7% per annum.(2)
The investment objectives for the Preferred Shares are to provide holders with fixed cumulative preferential quarterly cash distributions, currently in the amount of $0.16875 per Preferred Share (6.75% per annum on the original $10.00 issue price), and to return the original issue price to holders of Preferred Shares on August 30, 2029.
Over the last 10 years, the Preferred Share has generated a 5.8% per annum return.(2) Purchasers of Preferred Shares in this Offering will be eligible to receive the full August 2026 quarterly dividend of $0.16875 per Preferred Share when the dividend is declared.
The Fund invests in a portfolio (the “Portfolio”) consisting primarily of equity securities of Canadian dividend growth companies. In addition, the Company may hold up to 20% of the total assets of the Portfolio in global dividend growth companies for diversification and improved return potential, at the discretion of Brompton Funds Limited (“Brompton”). In order to qualify for inclusion in the Portfolio, at the time of investment, each dividend growth company included in the Portfolio must have (i) a market capitalization of at least CDN$2.0 billion; and (ii) a history of dividend growth or, in Brompton’s view, have high potential for future dividend growth.
Today they further announced:
Dividend Growth Split Corp. (the “Fund”) is pleased to announce a successful overnight treasury offering of class A shares and preferred shares (the “Class A Shares” and “Preferred Shares”, respectively). Gross proceeds of the offering are expected to be approximately $101.5 million. The offering is expected to close on or about August 19, 2026 and is subject to certain closing conditions. The Fund has granted the Agents (as defined below) an over-allotment option, exercisable for 30 days following the closing date of the offering, to purchase additional Class A Shares and Preferred Shares up to such number as is equal to 15% of the number of Class A Shares issued at the closing of the offering.
The Class A Shares were offered at a price of $8.75 per Class A Share for a distribution rate of 13.7%(1)(2) on the issue price, and the Preferred Shares were offered at a price of $10.75 per Preferred Share to yield 6.3%.(2)
The syndicate of agents for the offering was led by RBC Capital Markets, CIBC Capital Markets, National Bank Financial Inc., and Scotiabank and included Hampton Securities Limited, Canaccord Genuity Corp., BMO Capital Markets, Raymond James Ltd., TD Securities Inc., iA Private Wealth Inc., CI Investment Services Inc., Manulife Wealth Inc., Research Capital Corporation, Ventum Financial Corp., and Wellington-Altus Private Wealth Inc.
The Fund invests in a portfolio (the “Portfolio”) consisting primarily of equity securities of Canadian dividend growth companies. In addition, the Company may hold up to 20% of the total assets of the Portfolio in global dividend growth companies for diversification and improved return potential, at the discretion of Brompton Funds Limited (“Brompton”). In order to qualify for inclusion in the Portfolio, at the time of investment, each dividend growth company included in the Portfolio must have (i) a market capitalization of at least CDN$2.0 billion; and (ii) a history of dividend growth or, in Brompton’s view, have high potential for future dividend growth.
DGS.PR.A pays 6.75% on its $10 par value. It is scheduled to mature at par on 2029-8-30.
Thanks to Assiduous Reader Yomgui for bringing this to my attention!