E Split Corp. Announces New Preferred Share Distribution Rate
April 26 2023 - 5:39PM
(TSX: ENS, ENS.PR.A) The board of directors of E Split Corp. (the
“Company”) has extended the maturity date of the Company for an
additional 5-year term to June 30, 2028, as was detailed in the
press release dated February 1, 2023.
The Company is pleased to announce that the
distribution rate for the Preferred Shares for the new 5-year term
from June 30, 2023 to June 30, 2028 will be $0.70 per annum (7.0%
on the original issue price of $10) payable quarterly. The new
distribution rate represents a 33.3% increase from the current
$0.525 per annum distribution rate and provides investors with a
competitive yield reflecting current market yields for preferred
shares with similar terms. The new 5-year term extension also
offers Preferred shareholders the opportunity to enjoy preferential
cash dividends until June 30, 2028. Since inception from June 29,
2018 to March 31, 2023, the Preferred Share has delivered an
attractive 5.3% per annum return.
In addition, the Company intends to maintain the
targeted monthly Class A Share distribution rate at $0.13 per Class
A Share. Since inception to March 31, 2023, the Class A shares have
delivered a 11.1% per annum total return, including cash
distributions of $7.01 per share. Class A shareholders also have
the option to reinvest their cash distributions in a dividend
reinvestment plan which is commission free to participants.
The term extension allows Class A shareholders
to continue to have exposure to common shares of Enbridge Inc.
(“Enbridge”), a leading North American pipeline, natural gas
processing and distribution company, while benefiting from an
attractive distribution rate of 11.0% per annum based on the April
25, 2023 net asset value per share and the opportunity for capital
appreciation. As North America’s largest midstream company,
Enbridge has generated highly predictable, resilient cash flow and
has provided superior dividend growth and value creation through
various commodity price cycles.
In connection with the extension, Shareholders
can continue to hold their shares of both Classes and receive the
new, higher distribution rate on the Preferred Shares by taking no
action. Shareholders who do not wish to continue their investment
in the Company, will be able to retract Preferred Shares or Class A
Shares on June 30, 2023 pursuant to a special retraction right and
receive a retraction price that is calculated in the same way that
such price would be calculated if the Company were to terminate on
June 30, 2023. Pursuant to this option, the retraction price may be
less than the market price if the shares are trading at a premium
to net asset value. To exercise this retraction right, shareholders
must provide notice to their investment dealer by May 31, 2023 at
5:00 p.m. (Toronto time). Alternatively, shareholders may sell
their Preferred Shares and/or Class A Shares through their
securities dealer for the market price at any time, potentially at
a higher price than would be achieved through retraction.
E Split Corp. invests in common shares of
Enbridge and intends to purchase Enbridge common shares from time
to time in the market or through participation in future public
offerings by Enbridge.
About Middlefield
Founded in 1979, Middlefield is a specialist and
independent equity income manager headquartered in Toronto, Canada.
Middlefield’s actively managed, award-winning funds are designed to
be “investments that work for you” by distributing consistent and
high levels of income through various market cycles. Middlefield’s
funds span a number of market sectors including real estate,
healthcare, innovation, sustainability, infrastructure and energy.
Investors can access these strategies in a variety of product types
including ETFs, Mutual Funds, Closed-End Funds, Split-Share Funds
and Flow-through LPs.
For further information, please visit our
website at www.middlefield.com or contact Nancy
Tham in our Sales and Marketing Department at 1.888.890.1868. You
will usually pay brokerage fees to your dealer if you purchase or
sell shares of the investment funds on the Toronto Stock Exchange
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
funds. 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 in this press release may be
viewed as forward-looking statements. Any statements that express
or involve discussions with respect to predictions, expectations,
beliefs, plans, intentions, projections, objectives, assumptions or
future events or performance (often, but not always, using words or
phrases such as "expects", "is expected", "anticipates", "plans",
"estimates" or "intends" (or negative or grammatical variations
thereof), or stating that certain actions, events or results "may",
"could", "would", "might" or "will" be taken, occur or be achieved)
are not statements of historical fact and may be forward-looking
statements. Forward-looking statements are subject to a variety of
risks and uncertainties which could cause actual events or results
to differ from those reflected in the forward-looking statements
including as a result of changes in the general economic and
political environment, changes in applicable legislation, and the
performance of each fund. There are no assurances the funds can
fulfill such forward-looking statements and the funds do not
undertake any obligation to update such statements. Such
forward-looking statements are only predictions; actual events or
results may differ materially as a result of risks facing one or
more of the funds, many of which are beyond the control of the
funds. Investors should not place undue reliance on forward-looking
statements.
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