PrefBlog

Canadian Utilities Limited has announced:

CU Inc. announced today that it has notified the registered shareholder of its Cumulative Redeemable Preferred Shares Series 4 (“Series 4 Preferred Shares”) of a conversion privilege and applicable dividend rates. As a result, subject to certain conditions, the holders of Series 4 Preferred Shares will have the right to choose one of the following options with regard to their shares:

To retain any or all of their Series 4 Preferred Shares and continue to receive a fixed rate quarterly dividend; or
To convert, on a one-for-one basis, any or all of their Series 4 Preferred Shares into Cumulative Redeemable Preferred Shares Series 5 (“Series 5 Preferred Shares”) of CU Inc. and receive a floating rate quarterly dividend.
Effective June 1, 2026, the annual dividend rate for the Series 4 Preferred Shares is set at 4.573% for the five-year period from and including June 1, 2026 to but excluding June 1, 2031 and the Series 5 Preferred Shares floating quarterly dividend rate for the three-month period commencing June 1, 2026 to but excluding September 1, 2026 is set at an annual dividend rate of 3.646%. The dividend rate for the Series 5 Preferred Shares will be reset each quarter. Both rates were calculated according to the terms described in the short form prospectus of CU Inc. dated November 24, 2010.

Beneficial owners of Series 4 Preferred Shares who wish to exercise their right of conversion should communicate as soon as possible with their broker or other nominee and ensure that they follow their instructions in order to meet the deadline to exercise such right, which is 3 p.m. (Calgary time) / 5 p.m. (Toronto time) on May 19, 2026. Any notices received after this deadline will not be valid. As such, it is recommended that this be done well in advance of the deadline in order to provide the broker or other nominee with time to complete the necessary steps.

The foregoing conversions are subject to the conditions that: (i) if CU Inc. determines that there would be less than 1,000,000 Series 4 Preferred Shares outstanding on June 1, 2026, then all remaining Series 4 Preferred Shares will automatically be converted into Series 5 Preferred Shares on June 1, 2026, and (ii) alternatively, if CU Inc. determines that there would be less than 1,000,000 Series 5 Preferred Shares outstanding on June 1, 2026 after giving effect to conversion notices received, no Series 4 Preferred Shares will be converted into Series 5 Preferred Shares. If either of these scenarios occurs, CU Inc. will issue a news release to that effect on or before May 25, 2026.

Holders of the Series 4 Preferred Shares and the Series 5 Preferred Shares will have the opportunity to convert their shares again on June 1, 2031, and every five years thereafter as long as the shares remain outstanding.

For more information on the terms of, and risks associated with an investment in, the Series 4 Preferred Shares and the Series 5 Preferred Shares, please see CU Inc.’s short form prospectus dated November 24, 2010, which can be found under CU Inc.’s profile on SEDAR at www.sedarplus.ca.

CU Inc. is a wholly-owned subsidiary of Canadian Utilities Limited, an ATCO Company. CU Inc. is an Alberta-based corporation with approximately 3,600 employees and assets of $20 billion comprised of rate-regulated utility operations in electricity and natural gas distribution and transmission. More information about CU Inc. can be found on the Canadian Utilities Limited website at www.canadianutilities.com.

CIU.PR.C was issued as a 3.80%+136 FixedReset that commenced trading 2010-12-2 after being announced 2010-11-16. In 2016 it reset to 2.24% and there was no conversion to FloatingReset. In 2021 the issue reset to 2.29% and there was no conversion to the FloatingReset.

Thanks to Assiduous Readers earlyriser and HS for bringing this to my attention!

DBRS has announced that it:

changed the trends on Algonquin Power & Utilities Corp’s (APUC or the Company) credit ratings to Stable from Positive. Concurrently, Morningstar DBRS also confirmed APUC’s Issuer Rating at BBB and the credit rating on the Company’s Preferred Shares at Pfd-3.

KEY CREDIT RATING CONSIDERATIONS
APUC’s credit ratings are primarily based on the strength and stability of APUC’s subsidiary, Liberty Utilities Finance GP1 (LUF; rated BBB (high) with a Stable trend). LUF’s credit ratings are in turn based on the credit profile of Liberty Utilities Co. (LUCO), a fully regulated and diversified utility service provider. Morningstar DBRS based the credit rating confirmation on the strength and stability of LUCO’s business risk profile as a fully regulated and diversified utility service provider. LUCO’s business risk profile remained stable in 2025, underpinned by its (1) low-risk regulated asset base with reasonable regulatory frameworks across multiple jurisdictions and (2) geographically diversified portfolio with a reasonably sized customer base and large and growing rate base. The Company’s credit rating also incorporates the structural subordination of APUC’s debt to the debt of its subsidiaries.

The change in trends to Stable from Positive is concurrent with Morningstar DBRS’ credit rating actions on LUF. LUF’s capital investment plan between 2026 and 2028 is expected to require the issuance of additional debt such that its cash flow-to-debt ratio will remain less than the upgrade threshold of 15.0% over the forecast period. Additionally, upcoming maturities of $1.15 billion at APUC will likely be refinanced at LUCO. Nevertheless, Morningstar DBRS expects LUF’s cash flow-to-debt ratio to average around 12.0% over the forecast period, which is considered strong for the BBB (high) credit rating category, with adequate headroom to absorb any weakness.

There were no significant changes nor material adverse regulatory decisions in 2025 and year-to-date 2026 that affected LUCO’s credit profile. The Company achieved rate case settlements at various utilities including Empire District Electric Company; California–Liberty Utilities (CalPeco Electric) LLC; and New England Gas, which is expected to drive growth in earnings. The Company was also able to lower its operating expenses in 2025 through cost control measures and improve earned return of equity to 6.8% in 2025 (compared with 2024 at 5.5%).

CREDIT RATING DRIVERS
Morningstar DBRS could consider an upgrade if LUF gets upgraded and APUC maintains its financial risk profile. Conversely, APUC’s credit ratings could be downgraded if LUF’s credit ratings are downgraded or if APUC’s credit metrics weaken materially.

EARNINGS OUTLOOK
Morningstar DBRS expects APUC’s earnings to stabilize and be more predictable after the Company’s transition to a pure and fully regulated player. Morningstar DBRS also expects lower consolidated revenues from the sale of APUC’s renewable business (other than hydro) in 2025, offset by higher EBITDA margins driven by lower operating costs. Over time, Morningstar DBRS anticipates that APUC’s regulated businesses margins will strengthen as the Company continues to benefit from the implementation of higher approved rates and rate base year over year.

FINANCIAL OUTLOOK
APUC’s financial risk profile at year-end 2025 was strong, with actual debt-to-capital ratio less than the average of regulator-approved capital structure at the various regulated utilities. Morningstar DBRS expects cash flow from operations in 2026 to be modestly higher than in 2025 because of higher earnings. However, Morningstar DBRS expects the Company’s key credit metrics to modestly weaken as it raises additional debt to fund its capital investment plan over the next three years. Nevertheless, Morningstar DBRS expects the Company’s cash flow-to-debt ratio to average around 11.0% over the forecast period and stay supportive of the credit rating.

CREDIT RATING RATIONALE
APUC’s BBB Issuer Rating incorporates the business risk profile of its operating subsidiary, and APUC’s consolidated financial metrics, and the structural subordination of APUC to its operating subsidiary.

Comprehensive Business Risk Assessment (CBRA)
APUC’s CBRA of A/AL reflects its low business risk profile as a pure-play, distribution, transmission and generation business operating under an established and generally reasonable regulatory framework across multiple countries. The Company benefits from stable customer demand from its operating subsidiaries and minimal exposure to commodity or volume risk.

Comprehensive Financial Risk Assessment (CFRA)
APUC’s CFRA of AL/BBBH reflects its strong key credit metrics supported by reasonable leverage and adequate access to liquidity.

Intrinsic Assessment (IA)
The IA of BBBH is at the lower end of the IA range and is limited by LUF’s credit rating, given that APUC’s debt is structurally subordinate to debt at LUF. The IA assignment considers peer comparisons, among other factors.

Additional Considerations
APUC’s credit rating includes a negative adjustment for its structural subordination as the parent to its operating subsidiary.

Affected issues are AQN.PR.A and AQN.PR.D .

Mulvihill Capital Management Inc. has announced:

Premium Income Corporation (the “Fund”) is pleased to announce its intention to complete a share split of its class A shares (the “Share Split) due to the Fund’s strong performance. The holders of class A shares of record on the close of business on May 1, 2026 will receive 10 additional class A shares for every 100 Class A shares held, pursuant to the Share Split. The Share Split is subject to the approval by the Toronto Stock Exchange (the “TSX”).

As a result of the Share Split, the total dollar amount of distributions to be paid to the holders of Class A shares is expected to increase by approximately 10%.

The Class A shares are expected to commence trading on an ex-split basis at the opening of trading on May 1, 2026. No fractional Class A shares will be issued, and the number of Class A shares each holder shall receive will be rounded down to the nearest whole number. The Share Split is a non-taxable event. The Share Split will be reflected in the net asset value per Class A share as of May 7, 2026.

For further information, please contact Investor Relations at 416.681.3966, toll free at 1.800.725.7172, email at info@mulvihill.com or visit www.mulvihill.com

PIC.PR.A was last mentioned on PrefBlog in 2024, when there was a big retraction.

PIC.PR.A has a par value of 15.00, with a total NAVPU (including the Capital Units, which will shortly be split) of 27.39 as of 2026-04-30.

Manulife Financial Corporation has announced:

that it does not intend to exercise its right to redeem all or any of its currently outstanding 6,537,903 Non-cumulative Rate Reset Class 1 Shares Series 3 (the “Series 3 Preferred Shares”) (TSX: MFC.PR.F) or 1,462,097 Non-cumulative Floating Rate Class 1 Shares Series 4 (the “Series 4 Preferred Shares”) (TSX: MFC.PR.P) on June 19, 2026.

As a result, subject to certain conditions described in the prospectus supplement dated March 7, 2011 relating to the issuance of the Series 3 Preferred Shares and Series 4 Preferred Shares (the “Prospectus”), the holders of the Series 3 Preferred Shares have the right, at their option, to convert all or part of their Series 3 Preferred Shares on a one-for-one basis into Series 4 Preferred Shares on June 19, 2026. As well, subject to certain conditions, the holders of Series 4 Preferred Shares have the right to convert all or part of their Series 4 Preferred Shares on a one-for-one basis into Series 3 Preferred Shares on June 19, 2026. Holders who do not exercise their right to convert their Series 3 Preferred Shares into Series 4 Preferred Shares will retain their Series 3 Preferred Shares. Holders who do not exercise their right to convert their Series 4 Preferred Shares into Series 3 Preferred Shares will retain their Series 4 Preferred Shares.

Beneficial owners of Series 3 Preferred Shares and Series 4 Preferred Shares who wish to exercise their right of conversion should instruct their broker or other nominee to exercise such right before 5:00 p.m. (Toronto time) on June 4, 2026.

The foregoing conversions are subject to the conditions that: (i) if, after June 4, 2026, Manulife determines that there would be less than 1,000,000 Series 3 Preferred Shares outstanding on June 19, 2026, then all remaining Series 3 Preferred Shares will automatically be converted into an equal number of Series 4 Preferred Shares on June 19, 2026, and (ii) if, after June 4, 2026, Manulife determines that there would be less than 1,000,000 Series 4 Preferred Shares outstanding on June 19, 2026, then all remaining Series 4 Preferred Shares will automatically be converted into an equal number of Series 3 Preferred Shares. In either case, Manulife shall give written notice to that effect to any registered holders of Series 3 and Series 4 Preferred Shares on or before June 7, 2026.

The dividend rate applicable to the Series 3 Preferred Shares for the 5-year period commencing on June 20, 2026, and ending on June 19, 2031, and the dividend rate applicable to the Series 4 Preferred Shares for the 3-month period commencing on June 20, 2026, and ending on September 19, 2026, will be determined and announced by way of a news release on May 21, 2026. Manulife will also give written notice of these dividend rates to the registered holders of Series 3 Preferred Shares and Series 4 Preferred Shares.

Conversion inquiries should be directed to Manulife’s Registrar and Transfer Agent, TSX Trust Company (Canada), at 1-800-783-9495.

MFC.PR.F was issued as a 4.20%+141 FixedReset that commenced trading 2011-3-11 after being announced 2011-3-7. Notice of extension was published in 2016 and the rate reset to 2.178%. I recommended that holders not convert to FloatingResets but there was a 21% conversion anyway. In 2021, the dividend rate on MFC.PR.F reset to 2.348% and there was a 3% net conversion to the FixedReset.

MFC.PR.P is a FloatingReset, Bills+141bp, which arose via a partial conversion from MFC.PR.F in 2016.

Thanks to Assiduous Reader P_I for bringing this to my attention!