By Angela McDaniels
Tacoma, Wash., June 1 - Industrial Alliance Insurance and Financial Services Inc. issued C$150 million of series G noncumulative five-year rate-reset class A preferred shares in a bought-deal public offering, according to a company news release.
The initial dividend rate is 4.3%. On June 30, 2017 and on June 30 every five years after that, the dividend rate will reset to be equal to the five-year Government of Canada bond yield plus 285 basis points. Dividends are payable quarter when declared by the board of directors.
The offering priced May 24 and settled Friday. The price was C$25.00 per preferred.
The syndicate of underwriters was co-led by Scotiabank and RBC Capital Markets.
The preferreds are callable on June 30, 2017 and on June 30 every five years after that at C$25.00 per preferred plus accrued dividends.
On June 30, 2017 and on June 30 every five years after that, the holders will have the option to convert their series G preferreds into series H noncumulative floating-rate class A preferreds. The dividend rate for the series H preferreds will be equal to the 90-day Government of Canada treasury bill rate plus 285 bps.
The series H preferreds are callable at C$25.50 plus accrued dividends in the case of redemptions on June 30, 2022 and on June 30 every five years after that or C$25.50 plus accrued dividends in the case of redemptions on any other date after June 30, 2017.
On June 30, 2022 and on June 30 every five years after that, the holders of the series H preferreds will have the option to convert their series H preferreds back into series G preferreds.
The proceeds will be used for general corporate purposes and will be added to Industrial Alliance's capital base.
Industrial Alliance is a life and health insurance company based in Quebec City.
| Issuer: | Industrial Alliance Insurance and Financial Services Inc.
|
| Issue: | Series G noncumulative five-year rate-reset class A preferred shares
|
| Amount: | C$150 million
|
| Shares: | 6 million
|
| Maturity: | Perpetual
|
| Dividend: | Initially 4.3%; beginning June 30, 2017, rate will be reset every five years at five-year Government of Canada bond yield plus 285 bps
|
| Price: | C$25.00
|
| Call option: | At C$25.00 every five years beginning June 30, 2017
|
| Conversion option: | Into series H noncumulative floating-rate class A preferreds on June 30, 2017 and on June 30 every five years after that; dividend rate will be 90-day Government of Canada treasury bill rate plus 285 bps; series H preferreds will be convertible back into series G preferreds every five years beginning June 30, 2022
|
| Lead underwriters: | Scotiabank and RBC Capital Markets
|
| Pricing date: | May 24
|
| Settlement date: | June 1
|
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