Dividend 15 Split Corp. is a fairly unusual split-share corporation, in that they have been able to increase the number of shares outstanding since they were first traded 2004-3-16:
| DFN.PR.A Shares Outstanding | ||
| Date | Action | Shares |
| 2004-3-16 | Issue @ $10.00 | 8,400,000 |
| FY 2006 | Issue @ $10.75 | 1,215,000 |
| FY 2006 | Redemption | (211,500) |
| Current Outstanding | 9,403,500 | |
This issue has redemption terms I like: there ain’t none. Just the maturity 2009-12-1. Capital unitholders who wish to retract have to go out and buy a matching pref (or have the company do so on their behalf).
The company has now announced that
it will hold a special meeting of the shareholders on April 24, 2007. Shareholders of each Fund are being asked to consider a special resolution to amend the articles of Fund to extend the mandatory redemption date for the Class A Shares and the Preferred Shares to December 1, 2014.
No word on whether there will be a simultaneous decrease in the dividends payable – but if there isn’t, then the annual dividend of $0.525 (5.25% of par) makes this seem like a good deal!
I’ll write more when the details of the resolutions are release on SEDAR.
[…] Can’t think of any real reason why this would happen, other than it appears that someone at RBC was in a real hurry to sell 2,600 shares shortly after noon today. According to the latest valuation, asset coverage is in excess of 3:1 (maybe a bit less now, after what stocks did today!) and the latest financials show income coverage of 0.48:1 … the latter figure not the greatest in the world, but it could be worse! There is a meeting planned to extend the term on these shares … still unclear as to whether there will be any changes other than the term, but if the coupon of 5.25% is kept then this might just be a very good thing for preferred share value! We will have to examine the fine print in the shareholders’ resolution very carefully when it becomes available! Now with a pre-tax bid-YTW of 3.59% based on a bid of $10.44 and a hardMaturity 2009-12-01 at $10.00. […]
[…] As previously noted, shareholders of DFN.PR.A will be meeting on April 24 to consider a special resolution, the text of which has now been released: BE IT RESOLVED AS A SPECIAL RESOLUTION THAT: 1. The Articles of Dividend 15 Split Corp. (the “Fund”) be amended to extend the termination date of the Fund to December 1, 2014. 2. The directors and officers of the Fund be and they are hereby authorized and directed to take such action and to execute and deliver all such documentation as may be necessary or desirable for the implementation of this special resolution. 3. Notwithstanding the provisions hereof, the directors of the Fund may revoke this special resolution at any time prior to the endorsement by the Director of the Certificate of Amendment under the Business Corporations Act (Ontario) giving effect hereto without further approval of the shareholders of the Fund. […]