TransAlta Corp. is offering shareholders the option to convert 11 million of its outstanding series C preferred shares into series D preferred shares on a 1-for-1 basis by 5 p.m. ET on June 30.
The company said in a May 31 news release that it does not intend to exercise its right to redeem all or any part of the outstanding series C preferred shares.
The series D shares will have a quarterly floating rate cumulative preferential cash dividend rate of 3.629%, equal to the annual rate for the most recent auction of 90-day Government of Canada Treasury Bills of 0.529% plus 3.10%. The floating rate will be reset every quarter.
The series C shares will have fixed cumulative preferential cash dividend rate of 4.027%, equal to the five-year Government of Canada bond yield of 0.927% determined as of May 31, plus 3.10%, until June 30, 2022.
If the number of outstanding series C shares after June 30 remains less than 1 million, all series C shares will be converted to series D shares and if the total number of series D shares is less than 1 million, no series C shares will be converted to series D.