Purpose Investments Inc. (“Purpose Investments” or “Purpose”), on behalf of Big Banc Split Corp. (the “Company”), announced today the filing by the Company of a preliminary prospectus in relation to an initial public offering (the “Offering”) of preferred shares (the “Preferred Shares”) and class A shares (the “Class A Shares” and together with the Preferred Shares, the “Shares”). Shares are being offered at a price of $10.00 per Share.
Purpose will act as the manager, portfolio manager and promoter of the Company, and will provide all administrative services required by the Company.
The Company will invest on an approximately equally-weighted basis in a portfolio (the “Portfolio”) of equity securities (the “Portfolio Shares”) of the following publicly traded Canadian banks: Bank of Montreal; Canadian Imperial Bank of Commerce; National Bank of Canada; Royal Bank of Canada; The Bank of Nova Scotia; and The Toronto-Dominion Bank. In order to seek to generate additional returns and enhance the Portfolio’s income, the Manager may write covered call options and cash covered put options in respect of some or all of the Portfolio Shares held in the Portfolio.
The investment objectives for the Preferred Shares are to provide their holders with fixed cumulative preferential monthly cash distributions in the amount of $0.05 per Preferred Share ($0.60 per annum or 6.0% per annum on the issue price of $10.00 per Preferred Share) until November 30, 2023 (the “Maturity Date”) and to return the original issue price of $10.00 to holders on the Maturity Date.
The investment objectives for the Class A Shares are to provide their holders with regular monthly non-cumulative cash distributions initially in the amount of $0.067 per Class A Share, representing a yield on the issue price of the Class A Shares of 8.0% per annum and to provide holders with the opportunity for growth in the net asset value per Class A Share.
In order to seek to generate additional returns and enhance the Portfolio’s income, the manager may write covered call options and cash covered put options in respect of some or all of the Portfolio Shares held in the Portfolio. The manager expects that initially covered call options will be written on up to approximately 30% of the Portfolio Shares in the Portfolio.
At their election prospective purchasers may purchase: (i) Preferred Shares or Class A Shares by cash payment; or (ii) units (each such unit consisting of one Preferred Share and one Class A Share) or Class A Shares by an exchange (the “Exchange Option”) of freely tradeable securities of one or more of those issuers as set forth in the preliminary prospectus. Prospective purchasers pursuant to the Exchange Option are required to deposit their exchange eligible securities prior to 5:00 p.m. (Toronto time) on June 12, 2020 in the manner described in the preliminary prospectus.
The syndicate of agents for the Offering is being led by National Bank Financial Inc. and also includes CIBC Capital Markets, BMO Capital Markets, Canaccord Genuity Corp., RBC Capital Markets, Scotiabank, TD Securities Inc., Richardson GMP Limited, Industrial Alliance Securities Inc., Echelon Wealth Partners Inc., Raymond James Ltd., Desjardins Securities Inc., Hampton Securities Limited, Haywood Securities Inc., Mackie Research Capital Corporation, Manulife Securities Incorporated and PI Financial Corp.
About Purpose Investments
Purpose Investments is an asset management company with over $8-billion under management. Purpose Investments is built around the core values of risk management, quality investment strategies, transparency, accessibility and sustainability. Purpose Investments is led by well-known entrepreneur Som Seif and is a division of Purpose Financial, an independent technology-driven financial services company.
For further information please contact:
Purpose Investments Inc.
Tel: (877) 789-1517
A preliminary prospectus containing important information relating to these securities has been filed with securities commissions or similar authorities in each of the provinces and territories jurisdictions of Canada. The preliminary prospectus is still subject to completion or amendment. Copies of the preliminary prospectus may be obtained from any of the agents and is also available at www.sedar.com. There will not be any sale or acceptance of an offer to buy the securities until a receipt for the final prospectus has been issued.