Brompton Split Banc Corp. Announces Details of Class A Share Split and Concurrent Preferred Share Private Placement
December 01 2021 - 7:04PM
(TSX: SBC, SBC.PR.A) Brompton Split Banc Corp.
(the “Company”) is pleased to announce the details of the
previously announced split of its class A shares (the “Share
Split”) and provide an update on the concurrent private placement
of preferred shares (the “Private Placement”). The Share Split and
the Private Placement remain subject to the approval of the Toronto
Stock Exchange (the “TSX”).
The Company is pleased to announce that class A
shareholders of record at the close of business on December 14,
2021 will receive 25 additional class A shares for every 100 class
A shares held, pursuant to the Share Split. Following the Share
Split, class A shareholders will continue to receive the currently
targeted monthly distribution of $0.10 per class A share. As a
result, the Share Split will result in an overall increase in the
dollar amount of distributions to be paid to class A shareholders
by approximately 25%. The Company provides a distribution
reinvestment plan, on a commission-free basis for class A
shareholders that wish to reinvest distributions and realize the
benefits of compound growth.
Pursuant to the Private Placement, 3,164,203
preferred shares were offered to investors at a price of $10.10 per
preferred share such that following the Share Split there will be
an equal number of class A shares and preferred shares outstanding.
The Private Placement is scheduled to close on December 14, 2021.
Following the completion of the Share Split and the Private
Placement, the preferred shares are expected to have downside
protection from a decline in the value of the Company’s portfolio
of approximately 57%.(1)
Over the last 10 years, the class A shares have
delivered a 17.8% per annum total return based on NAV,
outperforming the S&P/TSX Capped Financials Index by 5.1% per
annum and the S&P/TSX Composite Index by 9.0% per annum.(2)
Since inception, class A shareholders have received cash
distributions of $18.75 per class A share.
The preferred shares have delivered a 4.9% per
annum total return over the last 10 years based on NAV,
outperforming the S&P/TSX Preferred Share Index by 1.5% per
annum with lower volatility.(2)
The Company invests, on an approximately equal
weighted basis, in a portfolio (the “Portfolio”) consisting of
common shares of the six largest Canadian banks (currently, Royal
Bank of Canada, The Bank of Nova Scotia, National Bank of Canada,
The Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and
Bank of Montreal). In addition, the Company may hold up to 10% of
the total assets of the Portfolio in investments in global
financial companies for the purposes of enhanced diversification
and return potential.
About Brompton Funds
Founded in 2000, Brompton Funds Limited
(“Brompton”) is an experienced investment fund manager with
income focused investment solutions including TSX listed
closed-end funds and exchange-traded funds. 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 us at info@bromptongroup.com or
visit our website at www.bromptongroup.com.
(1) Based on the November 25, 2021
NAV of the class A shares, as used to determine the Share Split
ratio.(2) See Standard Performance Data table
below.
Brompton Split Banc Corp.Compound Annual NAV
returns to October 31, 2021 |
1 Yr |
|
3 Yr |
|
5 Yr |
|
10 Yr |
|
S.I. |
|
Class A Shares (TSX:SBC) |
123.3 |
% |
21.6 |
% |
17.9 |
% |
17.8 |
% |
12.7 |
% |
S&P/TSX Capped Financials Index |
55.7 |
% |
15.3 |
% |
12.6 |
% |
12.7 |
% |
9.2 |
% |
S&P/TSX Composite Index |
38.8 |
% |
15.3 |
% |
10.6 |
% |
8.8 |
% |
7.4 |
% |
|
|
|
|
|
|
Preferred Shares (TSX:SBC.PR.A) |
5.1 |
% |
5.1 |
% |
5.0 |
% |
4.9 |
% |
5.1 |
% |
S&P/TSX Preferred Share Index |
28.8 |
% |
6.7 |
% |
7.2 |
% |
3.4 |
% |
3.1 |
% |
Returns are for the periods ended October 31,
2021 and are unaudited. Inception date November 15, 2005. The table
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 Share Index”)
(together the “Indices”). 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 Share
Index tracks the performance, on a market weight basis, of
preferred shares listed on the TSX that meet criteria relating to
minimum size, liquidity, issuer rating, and exchange listing. The
class A shares and preferred shares are 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.
You will usually pay brokerage fees to your
dealer if you purchase or sell shares of the investment funds 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 investment fund 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 fund in the
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.
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 fund, to the future outlook of
the fund and anticipated events or results and may include
statements regarding the future financial performance of the fund.
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.
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