Manulife Financial Launches $223M Pfd Sh Offering

Manulife Financial Corp (MFC.TO), Canada's largest insurance company, said on Monday it will issue as much as C$250 million ($223 million) of preferred shares to reduce debt and strengthen its balance sheet.
The move comes about two months after Manulife said it would issue C$600 million in medium-term notes and three months after it launched a C$450 million preferred share issue.
Manulife said it will issue 8 million series 1 preferred shares at C$25 each to raise C$200 million.
Underwriters, led by Scotia Capital Inc and RBC Dominion Securities, have the option of buying up to an additional 2 million of the shares for C$50 million more in gross proceeds, the company said.
The shares pay a noncumulative quarterly fixed dividend yielding 5.6 percent annually until Sept. 19, 2014. They can be converted into rate reset series 2 preferred shares on Sept. 19 2014 and every five years after that.
"Approximately half of the net proceeds from the offering will be applied to reduce amounts outstanding under Manulife's credit facility with Canadian chartered banks and the balance of the net proceeds will be utilized for general corporate purposes," the company said in a statement.
Manulife common shares rose 0.5 percent to C$21.74 on the Toronto Stock Exchange on Monday. They are down 45 percent from a 52-week high reached in June last year.
Most of Canada's financial institutions have tapped debt and equity market for additional funds in recent months to strengthen their balance sheets.