{"id":2124,"date":"2008-05-06T15:20:21","date_gmt":"2008-05-06T19:20:21","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=2124"},"modified":"2008-05-06T15:20:21","modified_gmt":"2008-05-06T19:20:21","slug":"new-issue-fortis-perp-fixed-reset","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=2124","title":{"rendered":"New Issue : Fortis Perp Fixed-Reset"},"content":{"rendered":"

It looks like the Desjardins Fixed-Reset idea<\/a> used by Scotia’s recent new issue<\/a> has found another customer.<\/p>\n

Fortis has announced<\/a>:<\/p>\n

that it has entered into an agreement with a syndicate of underwriters led by Scotia Capital Inc. and CIBC World Markets Inc. pursuant to which they have agreed to purchase from Fortis and sell to the public 8,000,000 Cumulative Redeemable Five-Year Fixed Rate Reset Series G First Preference Shares (the “Series G First Preference Shares”) of the Corporation (the “Offering”). The underwriters will also have the option to purchase up to an additional 1,200,000 Series G First Preference Shares to cover over-allotments, if any, and for market stabilization purposes, during the 30 days following the closing of the Offering (the “Over-Allotment Option”).<\/p>\n

Holders of Series G First Preference Shares will be entitled to receive a cumulative quarterly fixed dividend for the initial five-year period ending on August 31, 2013 of 5.25% per annum, if, as and when declared by the Board of Directors of the Corporation. Thereafter, the dividend rate will reset every five years at a level of 2.13% over the five-year Canada bond yield.<\/p>\n

The purchase price of $25.00 per Series G First Preference Share will result in gross proceeds of $200,000,000 ($230,000,000, if the Over-Allotment Option is exercised in full). The net proceeds of the Offering will be used to repay the total amount outstanding of approximately $170 million under the Corporation’s committed credit facility, which indebtedness was incurred to fund a portion of the purchase price for the acquisition of Terasen Inc. on May 17, 2007 and the purchase price for the acquisition of the Delta Regina hotel on August 1, 2007. The balance will be used for general corporate purposes.<\/p>\n

The Offering is subject to the receipt of all necessary regulatory and stock exchange approvals. Closing is expected to occur on or about May 23, 2008.<\/p><\/blockquote>\n

Issuer : Fortis Inc. (FTS)<\/p>\n

Issue: Cumulative Redeemable Five-Year Fixed Rate Reset Preference Shares, Series G<\/p>\n

Amount: 8-million shares @ $25 (= $200-million)<\/p>\n

Greenshoe: 1.2-million shares @ $25.00, up to 30 days after closing.<\/p>\n

Initial dividend rate: 5.25% (= $1.3125 p.a.) until the August 31, 2013. First reset date September 1, 2013.<\/p>\n

Dividend Resets: Resets every 5 years to 5-year Canadas + 213bp, determined 30 days prior to the reset period.<\/p>\n

Redemption: Redeemable on every reset date at $25.00<\/p>\n

Priority: Parri Passu with other prefs, senior to common. Voting rights if eight dividends are missed.<\/p>\n

Ratings: S&P: P-2 ; DBRS Pfd-3(high)<\/p>\n

Closing: On or about May 23, 2008<\/p>\n

I don’t like ’em. I’ve said it before … I’ll say it again. If I’m going to lend perpetual money, I want perpetual dividend rates!<\/p>\n","protected":false},"excerpt":{"rendered":"

It looks like the Desjardins Fixed-Reset idea used by Scotia’s recent new issue has found another customer. Fortis has announced: that it has entered into an agreement with a syndicate of underwriters led by Scotia …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[17],"tags":[],"class_list":["post-2124","post","type-post","status-publish","format-standard","hentry","category-new-issues"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/2124","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2124"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/2124\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2124"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2124"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2124"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}