By Cristal Cody
Eureka Springs, Ark., Nov. 14 – TransCanada Corp. priced an upsized C$1 billion of cumulative redeemable minimum rate reset first preferred shares with a 4.9% annual dividend for the initial period ending May 31, 2022, according to a company release on Monday.
The company sold 40 million shares of the series 15 preferred stock at C$25.00 per share.
TransCanada initially priced C$500 million, or 20 million shares, of the preferred stock, according to an earlier news release.
Scotia Capital Inc., BMO Capital Markets Corp., CIBC World Markets Inc., RBC Dominion Securities Inc. and TD Securities Inc. were the lead managers.
TransCanada may redeem the preferred shares on May 31, 2022 and on the last business day in May every fifth year thereafter at C$25.00 per share plus accrued and unpaid dividends.
The dividend rate will reset on May 31, 2022 and on the last business day of May in every fifth year subsequently at a rate equal to the sum of the then five-year Government of Canada bond yield plus 385 basis points with a floor of 4.9%.
The holders of the series 15 preferred shares have the right to convert their stock into series 16 cumulative redeemable first preferred shares on May 31, 2022 and on the last business day in May every following fifth year.
Series 16 preferred shareholders will be entitled to receive quarterly floating-rate cumulative dividends at an annualized rate equal to the sum of the then 90-day Government of Canada treasury bill rate plus 385 bps.
The proceeds of the offering will be used for general corporate purposes and to reduce short-term debt of TransCanada and its affiliates.
TransCanada Pipelines is a natural gas and oil pipeline and storage company based in Calgary, Alta.
| Issuer: | TransCanada Corp.
|
| Amount: | C$1 billion, 40 million shares
|
| Maturity: | Perpetual
|
| Securities: | Cumulative redeemable minimum rate reset first preferred shares
|
| Bookrunners: | Scotia Capital Inc., BMO Capital Markets Corp., CIBC World Markets Inc., RBC Dominion Securities Inc. and TD Securities Inc.
|
| Dividend: | 4.9%; resets May 31, 2022 and on last business day of May every fifth year subsequently at the then five-year Government of Canada bond yield plus 385 bps with a floor of 4.9%
|
| Price: | C$25.00 per share
|
| Call feature: | May 31, 2022 and on last business day of May every following fifth year at C$25.00 per share plus accrued and unpaid dividends
|
| Pricing date: | Nov. 14
|
| Settlement date: | Nov. 21
|
| Ratings: | DBRS: Pfd-2
|
| Distribution: | Canada
|
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