CanBanc 8 Income Corp.: Closes Initial Public Offering
TORONTO, ONTARIO--(Marketwire - Dec 19, 2012) - CanBanc 8 Income Corp. (the "Company") (TSX:CBF) announces the closing of its initial public offering. Pursuant to the offering, the Company issued 4 million equity shares (the "Shares") at $10 per Share, for gross proceeds of $40 million. The Shares are listed on the Toronto Stock Exchange under the symbol CBF. The Company has granted the agents of the offering an over-allotment option to acquire up to 600,000 additional Shares at a price of $10 per Share exercisable at any time during the next thirty days.
The Company will invest in a portfolio (the "Portfolio") of common shares (the "Portfolio Shares") of the eight largest Canadian banks: Bank of Montreal; Canadian Imperial Bank of Commerce; Canadian Western Bank; Laurentian Bank of Canada; National Bank of Canada; Royal Bank of Canada; The Bank of Nova Scotia; and The Toronto-Dominion Bank (each, a "Bank", and collectively, the "Banks") on a market capitalization weighted basis. First Asset Investment Management Inc. (the "Manager" or "First Asset") intends each month to sell call options on approximately, and not more than, 25% of the common shares of each Bank held in the Portfolio in order to seek to earn attractive tax effective income from dividends and call option premiums, lower the overall volatility of returns associated with owning a portfolio of common shares of the Banks, and to generate capital appreciation for holders of Shares (the "Shareholders").
The objectives of the Company are to provide Shareholders with:
quarterly distributions;
the opportunity for capital appreciation; and
lower overall volatility of Portfolio returns than would be experienced by owning a portfolio of common shares of the Banks directly.
The Company will not have a fixed distribution, but intends to set periodic distribution targets. Based on the Manager''s current estimates, the initial distribution target for the Company is expected to be $0.15 per quarter ($0.60 per annum to yield 6.0% on the subscription price of $10 per Share).
First Asset is a Canadian wealth management company that manages and administers approximately $2.6 billion in assets.
The syndicate of agents for this offering was led by CIBC, co-led by National Bank Financial Inc. and RBC Capital Markets, and included BMO Capital Markets, Scotiabank, TD Securities Inc., Canaccord Genuity Corp., GMP Securities L.P., Raymond James Ltd., Desjardins Securities Inc., Dundee Securities Ltd., Macquarie Private Wealth Inc. and Manulife Securities Incorporated.
