North American Financial 15 Split Corp T.FFN

Alternate Symbol(s): FNCSF

Financial Services Asset Management

North American Financial 15 Split Corp. is a mutual fund corporation, which invests in a portfolio of over 15 financial services companies. It offers two types of shares, such as Preferred Shares and Class A Shares. Its investment objectives with respect to preferred shares are to provide holders of preferred shares with cumulative preferential monthly cash dividends, the amount of which is fixed on an annual basis and to pay the holders of the preferred shares a certain price per preferred share on or about the termination date. Its investment objectives with respect to class A shares are to provide holders of class A shares with regular monthly cash distributions and to permit holders to participate in all growth in the net asset value of the Company for a specific price per unit, by paying holders on or about the termination date such amounts as remain in the Company after paying a specific price per preferred share. Its investment manager is Quadravest Capital Management Inc.

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North American Financial 15 Split Corp > Dashboard potential issue - Dec 5, 2024

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Comment by navgodon Dec 05, 2024 5:26pm

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Post# 36348139

RE:RE:RE:RE:RE:RE:RE:RE:Dashboard potential issue - Dec 5, 2024

You are missing the Special Retraction Right that occurs whenever the fund is extended in FFN's case every five years. This is the retraction that is currently under way. Either prefs and/or class A shares can be retracted and will receive their full NAV value. A detailed explaination is provided in the Annual Information Report under the Termination of the fund section. The impact of the retraction depends on the size of the discount/premium of the two components,the % of the retraction and the method used to rebalance the fund. Hope this helps your understanding. GLTA

WadaSoorma wrote:
First-time poster here; apologies if I’m mistaken. It seems the 55,220,987 figure might reflect Class A retractions, with Quadravest repurchasing and canceling Preferred shares to balance the structure.

There are three types of retractions: Preferred Share, Class A Share, and Concurrent Retraction.

Preferred Share Retraction: Shareholders receive the lesser of $10 or 96% of NAV per unit minus costs (1%) and the cost of purchasing Class A shares for cancellation. Retraction Price = min($10, 0.96 × NAV − Class A cost − fees). Since Preferred shares trade near $10, this isn’t attractive.

Class A Retraction: Shareholders get 96% of NAV per unit minus the cost of purchasing Preferred shares and fees. Retraction Price = 0.96 × NAV − Preferred cost − fees. Using $18.50 NAV and $7.40 trading price, the retraction price is ~$7.02, which may attract sellers.

Concurrent Retraction: NAV per unit minus 1% in fees.

The NAV impact depends on retraction funding. If Quadravest sells assets, NAV might dip slightly. However, NAV often remains stable if cash reserves cover retractions. The consolidation of FTN could reflect share count adjustments without market purchases, while Preferred shares are more rigid due to their $10 guarantee.