New York, June 2 - Element Financial Corp. said it priced a bought-deal offering of C$100 million of series E cumulative five-year rate reset preferred shares.
The company sold 4 million of the preferreds at C$25.00 each.
BMO Nesbitt Burns Inc. led the sale. The syndicate also included CIBC World Markets Inc., GMP Securities LP, Barclays Capital Canada Inc., National Bank Financial Inc., TD Securities Inc., Credit Suisse Securities (Canada) Inc., RBC Dominion Securities Inc., Scotia Capital Inc., Cormark Securities Inc. and Manulife Securities Inc.
The preferreds will pay a dividend of 6.4% for the first five years, running until Sept. 30, 2019. After that the rate will reset every five years to the yield on the five-year Government of Canada bond plus 472 basis points.
Element Financial will be able to call the preferreds on Sept. 30, 2019 and every five years subsequently.
If the securities are not redeemed, holders will have the right to convert them to series F preferred shares that will pay a dividend of the three-month Government of Canada Treasury bill yield plus 472 bps.
Proceeds together with funds from C$250 million of convertible debentures and C$750 million of subscription receipts plus bank financing will be used to fund the acquisition of PHH Corp.'s fleet management services business.
Element Financial is a Toronto-based equipment finance company.
| Issuer: | Element Financial Corp.
|
| Issue: | Series E rate reset preferred share
|
| Amount: | C$100 million
|
| Dividend: | 6.4% through Sept. 30, 2019, then resets every years to the yield on the five-year Government of Canada bond plus 472 basis points
|
| Price: | Par of C$25.00
|
| Call: | On Sept. 30, 2019 and every five years subsequently
|
| Conversion option: | On Sept. 30, 2019 and every five years subsequently into series F preferred shares that will pay a dividend of the three-month Government of Canada Treasury bill yield plus 472 bps
|
| Pricing date: | June 2
|
| Settlement: | June 18
|
| Lead manager: | BMO Nesbitt Burns Inc.
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| Co-managers: | CIBC World Markets Inc., GMP Securities LP, Barclays Capital Canada Inc., National Bank Financial Inc., TD Securities Inc., Credit Suisse Securities (Canada) Inc., RBC Dominion Securities Inc., Scotia Capital Inc., Cormark Securities Inc. and Manulife Securities Inc.
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