Not for distribution to U.S. newswire services or for dissemination in the United States.
TORONTO, June 19, 2018 (GLOBE NEWSWIRE) -- Life & Banc Split Corp. (TSX:LBS) (TSX:LBS.PR.A) (the “Company”) is pleased to announce it is undertaking an overnight treasury offering of class A and preferred shares (the “Class A Shares” and “Preferred Shares”, respectively).
The sales period for this overnight offering will end at 9:00 a.m. (ET) on Wednesday, June 20, 2018. The offering is expected to close on or about July 4, 2018 and is subject to certain closing conditions including approval by the Toronto Stock Exchange (“TSX”).
The Class A Shares will be offered at a price of $9.80 per Class A Share for a distribution rate of 12.2% on the issue price, and the Preferred Shares will be offered at a price of $10.00 per Preferred Share for a yield to maturity of 4.9%.(1) The closing price on the TSX for each of the Class A and Preferred Shares on June 18, 2018 was $9.99 and $10.18, respectively. The Class A and Preferred Share offering prices were determined so as to be non-dilutive to the most recently calculated net asset value per unit of the Company (calculated as at June 18, 2018), as adjusted for dividends and certain expenses to be accrued prior to or upon settlement of the offering.
The Company invests in a portfolio (the “Portfolio”) consisting of common shares of the six largest Canadian banks and the four major publicly traded Canadian life insurance companies:
| The Bank of Nova Scotia | Royal Bank of Canada |
| National Bank of Canada | Industrial Alliance Insurance and Financial Services Inc. |
| The Toronto-Dominion Bank | Great-West Lifeco Inc. |
| Canadian Imperial Bank of Commerce | Manulife Financial Corporation |
| Bank of Montreal | Sun Life Financial Inc. |
The investment objectives for the Class A Shares are to provide holders with regular monthly cash distributions targeted to be $0.10 per Class A Share and to provide the opportunity for growth in the net asset value per Class A Share.
The investment objectives for the Preferred Shares are to provide holders with fixed cumulative preferential quarterly cash distributions, currently in the amount of $0.11875 per Preferred Share, and to return the original issue price plus accrued dividends (if any) to holders of Preferred Shares on November 29, 2018.
On September 25, 2017 the Company’s board of directors approved an extension of the maturity date of the Class A and Preferred Shares of the Company for an additional term to October 30, 2023. The Preferred Share dividend rate for the extended term will be announced at least 60 days prior to the original November 29, 2018 maturity date. The new dividend rate will be determined based on market yields for Preferred Shares with similar terms.
The syndicate of agents for the offering is being led by RBC Capital Markets, CIBC Capital Markets, National Bank Financial and Scotiabank.
About Brompton Funds
Brompton Funds, a division of Brompton Group (“Brompton”) which was founded in 2000, is an experienced investment fund manager with approximately $2 billion in assets under management. Brompton’s investment solutions include TSX-traded funds, mutual funds and flow-through limited partnerships. For further information, please contact your investment advisor, call Brompton’s investor relations line at 416-642-6000 (toll-free at 1-866-642-6001), email info@bromptongroup.com or visit our website at www.bromptongroup.com.
(1) See Performance table below
| Life & Banc Split Corp. Compound Annual NAV Returns to May 31, 2018 | 1-Yr | 3-Yr | 5-Yr | 10-Yr | S.I.(2) |
| Class A Shares (TSX: LBS) | 17.9% | 15.7% | 20.4% | 11.6% | 9.8% |
| S&P/TSX Composite Index | 7.7% | 5.4% | 8.0% | 3.9% | 5.5% |
| S&P/TSX Capped Financials Index | 11.5% | 10.3% | 12.5% | 8.6% | 7.8% |
| Preferred Shares (TSX: LBS.PR.A) | 4.9% | 4.9% | 4.9% | 5.1% | 5.2% |
| S&P/TSX Preferred Share Index | 7.9% | 3.2% | 1.2% | 3.1% | 2.3% |
A short form base shelf prospectus containing important detailed information about the securities being offered has been filed with securities commissions or similar authorities in each of the provinces and territories of Canada. Copies of the short form base shelf prospectus may be obtained from a member of the syndicate. The Company intends to file a supplement to the short form base shelf prospectus, and investors should read the short form base shelf prospectus and the prospectus supplement before making an investment decision. There will not be any sale or any acceptance of an offer to buy the securities being offered until the prospectus supplement has been filed with the securities commissions or similar authorities in each of the provinces and territories of Canada.
You will usually pay brokerage fees to your dealer if you purchase or sell shares of the Company on the TSX or other alternative Canadian trading system (an “exchange”). If the shares are purchased or sold on an exchange, investors may pay more than the current net asset value when buying shares of the Company and may receive less than the current net asset value when selling them.
There are ongoing fees and expenses associated with owning shares of an investment fund. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about the Company in its public filings available at www.sedar.com. The indicated rates of return are the historical annual compounded total returns including changes in share value and reinvestment of all distributions and do not take into account certain fees such as redemption costs or income taxes payable by any securityholder that would have reduced returns. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.
Returns are for the periods ended May 31, 2018. The table above shows the Company’s compound return on a Class A Share and Preferred Share for each period indicated, compared with the S&P/TSX Capped Financials Index (‘‘Financials Index’’), the S&P/TSX Composite Index (‘‘Composite Index’’) and the S&P/TSX Preferred Share Index ("Preferred Index"). The Financials Index is derived from the Composite Index based on the financials sector of the Global Industry Classification Standard. The Composite Index tracks the performance, on a market weight basis, of a broad index of large-capitalization issuers listed on the TSX. The Preferred Index tracks the performance of the Canadian preferred share market. The Company invests in a passively managed portfolio of four Canadian life insurance companies and six Canadian banks. The Company is not expected to mirror the performance of the indices, which have more diversified portfolios. The indices are calculated without the deduction of management fees, fund expenses and trading commissions, whereas the performance of the Company is calculated after deducting such fees and expenses. Further, the performance of the Company’s Class A Shares is impacted by the leverage provided by the Company’s Preferred Shares.
Certain statements contained in this document constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking information may relate to matters disclosed in this document and to other matters identified in public filings relating to the Company, to the future outlook of the Company and anticipated events or results and may include statements regarding the future financial performance of the Company. In some cases, forward-looking information can be identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue” or other similar expressions concerning matters that are not historical facts. Actual results may vary from such forward-looking information. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no obligation to update or revise them to reflect new events or circumstances.
The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or any applicable exemption from the registration requirements. This news release does not constitute an offer to sell or the solicitation of an offer to buy securities nor will there be any sale of such securities in any state in which such offer, solicitation or sale would be unlawful.