By Rebecca Melvin
New York, Nov. 21 - Bell Aliant Preferred Equity Inc., a subsidiary of Bell Aliant Inc., has priced C$100 million of cumulative rate-reset preferred shares at par of C$25.00 on a bought-deal basis to yield 4.55% for the first five years, according to a news release.
The series C preferred shares being sold via a syndicate of underwriters led by RBC Capital Markets, Scotia Capital and BMO Capital Markets has an over-allotment option for up to an additional C$15 million.
The 4 million preferred shares plus a potential 600,000 share greenshoe will pay cumulative dividends of C$1.1375 per share per year, yielding 4.55% for the initial five-year period ending March 31, 2017.
The rate on the series C preferreds, which will be non-callable for five years, will then be reset to equal the five-year Government of Canada bond yield plus 309 basis points. The rate will be reset every five years.
Holders will be able to convert their shares into cumulative floating-rate preferred shares, series D, on March 31, 2017 and on March 31 every five years thereafter.
Holders of the series D preferred will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada treasury bill yield plus 309 bps.
Proceeds of this offering will be used to make a lump-sum voluntary contribution to certain of Bell Aliant's pension plans and for general corporate purposes.
The series C preferreds will be offered for sale to the public in each of the provinces and territories of Canada under a short form prospectus.
The offering is scheduled to close Dec. 7.
Bell Aliant is one of North America's largest regional communications providers and serves customers in six Canadian provinces.
| Issuer: | Bell Aliant Preferred Equity Inc.
|
| Guarantor: | Bell Aliant Inc.
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| Amount: | C$100 million
|
| Greenshoe: | C$15 million
|
| Securities: | Cumulative rate reset preferred shares
|
| Bookrunners: | RBC Capital Markets, Scotia Capital, BMO Capital Markets
|
| Dividend: | 4.55%
|
| Price: | C$25.00 per share
|
| Yield: | 4.55% for first five years
|
| Reset rate: | Five-year Government of Canada bond plus 3.09%
|
| Convertible into: | Series D preferreds with a floating rate equal to the three-month Government of Canada treasury bills plus 309 bps
|
| Pricing date: | Nov. 21
|
| Settlement date: | Dec. 7
|
| Distribution: | Canada
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