The Company invests in a portfolio (the Portfolio) of approximately equally weighted common shares and securities convertible into or exchangeable for common shares (
Holders of the Preferred Shares receive a quarterly fixed cumulative dividend in the amount of
As of
On
The redemption date for both classes of shares is
Considering the credit quality and diversification of the Portfolio, as well as the amount of downside protection available to the Preferred Shares and a consistent dividend-paying history of the underlying companies in the Portfolio, DBRS Morningstar confirmed the rating on the Preferred Shares at Pfd-3 (high).
The main constraints to the rating are the following:
(1) Sensitivity of the Company's NAV to volatility of prices of the Portfolio securities.
(2) Potential foreign-exchange risk because the income received on the Portfolio is not hedged.
(3) Stated distributions to the Class A Shares.
(4) Potential changes in the dividend policies of the underlying companies.
(5) The healthcare industry-specific risks.
(6) Market fluctuations resulting from the response to the worldwide spread of the Coronavirus Disease (COVID-19) that could negatively affect the Company's NAV.
The rating includes additional analysis of the Company's expected performance as a result of the global efforts to contain the coronavirus. The DBRS Morningstar sovereigns group initially published its outlook on the pandemic's impact on key economic indicators for the 2020-22 time frame on
ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.
Notes:
All figures are in Canadian dollars unless otherwise noted.
The principal methodology is Rating Canadian Split Share Companies and Trusts (
The DBRS
The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.
The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.
For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.
Tel. +1 416 593-5577
Ratings
Date Issued Debt Rated Action Rating Trend Attributesi
US = Lead Analyst based in USA
CA = Lead Analyst based in
EU = Lead Analyst based in EU
E = EU endorsed
U =
Unsolicited Participating With Access
Unsolicited Participating Without Access
Unsolicited Non-participating
15-Oct-21 Preferred Shares Confirmed Pfd-3 (high) -- CA
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