By Cristal Cody
Tupelo, Miss., Jan. 25 – Empire Life Insurance Co. announced on Monday that it priced C$130 million of non-cumulative rate reset series 1 preferred shares with a 5.75% annual dividend for the initial period through April 17, 2021.
The company sold 5.2 million shares of the preferred stock (DBRS: Pfd-2) at C$25.00 per share.
The transaction includes an over-allotment option of 780,000 shares.
Scotia Capital Inc., CIBC World Markets Inc. and TD Securities Inc. were the lead underwriters.
The dividend will reset every five years at a rate equal to the five-year Government of Canada bond yield plus 499 basis points.
Series 1 preferred shareholders will have the right to convert their shares into series 2 non-cumulative floating-rate preferred shares on April 17, 2021 and on April 17 every five years thereafter.
Holders of the series 2 preferred shares will be entitled to receive non-cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada treasury bill yield plus 499 bps.
Empire Life intends to use the proceeds from the offering for regulatory capital and general corporate purposes.
The Kingston, Ont.-based individual and group life and health insurance and investment company is a subsidiary of E-L Financial Corp. Ltd.
| Issuer: | Empire Life Insurance Co.
|
| Amount: | C$130 million, 5.2 million shares
|
| Greenshoe: | 780,000 shares
|
| Maturity: | April 17, 2021
|
| Securities: | Non-cumulative rate reset preferred shares
|
| Bookrunners: | Scotia Capital Inc., CIBC World Markets Inc., TD Securities Inc.
|
| Dividend: | 5.75%; resets every five years at rate equal to five-year Government of Canada bond yield plus 499 bps
|
| Price: | C$25.00 per share
|
| Pricing date: | Jan. 25
|
| Settlement date: | Feb. 16
|
| Rating: | DBRS: Pfd-2
|
| Distribution: | Canada
|
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