Ninepoint's $31.6M Split Corp. Raise Taps High-Yield Demand

TORONTO, ON – April 22, 2026 – Canadian Large Cap Leaders Split Corp. announced today the successful completion of an overnight offering that raised total gross proceeds of $31,606,181, signaling robust investor appetite for income-generating structured products. The offering, led by National Bank Financial Inc., involved the sale of 1,314,383 Preferred Shares and 1,140,800 Class A Shares.

The capital raise, managed by prominent alternative investment firm Ninepoint Partners LP, taps into a prevailing theme in Canadian markets: the persistent search for yield. The proceeds are earmarked for a portfolio of blue-chip Canadian dividend-growing companies, a strategy that continues to resonate with investors navigating an uncertain economic landscape.

The Resurgence of Yield Hunting

The success of this offering underscores a powerful trend among Canadian investors. In a market where traditional fixed-income returns have faced pressure, structured products promising high, regular distributions are gaining significant traction. This $31.6 million raise is a clear indicator that the demand for yield-focused investments remains strong, particularly for those offering a higher payout than government bonds or standard dividend stocks.

The offering's terms are designed to be compelling. The Preferred Shares, offered at $10.55, aim to provide fixed quarterly distributions that translate to a 7.5% annual yield on their original $10.00 issue price. The Class A Shares, priced at $15.55, target a much higher monthly distribution, representing a 13.9% annual yield on the offering price. These figures stand out in a market where a dividend yield of 4-6% is often considered high.

This structure is particularly appealing to two distinct investor profiles. Retirees and other income-seekers are often drawn to the stability and preferential treatment of the Preferred Shares. Meanwhile, investors with a higher risk tolerance may be attracted to the leveraged return potential of the Class A Shares, which benefit from both distributions and any capital appreciation in the underlying portfolio. The successful placement of over 2.4 million shares combined suggests that both investor camps found the offering attractive.

Deconstructing the Split Share Structure

For many investors, the term "split share corporation" can seem complex, but its core function is to divide the investment returns of a single portfolio into two different streams. The Canadian Large Cap Leaders Split Corp. follows this classic model, creating separate securities for investors focused on income stability versus those seeking income and growth.

The Preferred Shares represent the more conservative side of the structure. Holders are promised a fixed, cumulative quarterly cash distribution of $0.1875 per share. The "cumulative" feature is critical; if the company misses a payment, it must be paid back in the future before Class A shareholders receive anything. Their primary objective is to receive these regular payments and have their original investment of $10.00 returned at the maturity date, set for February 2029. They are priced slightly above their issue value in this offering, reflecting current market demand.

In contrast, the Class A Shares are designed for investors with a greater appetite for risk and reward. They receive the remaining income from the portfolio after the Preferred Share distributions are paid and benefit from any growth in the portfolio's net asset value (NAV). This structure provides leverage; a small increase in the underlying portfolio's value can lead to a larger percentage gain for Class A shareholders. However, the risk is also amplified. Their distributions are non-cumulative, meaning a missed payment is lost forever. If the portfolio's NAV falls below a certain threshold (typically 1.5 times the value of the Preferred Shares), distributions to Class A shareholders are suspended to protect the Preferred shareholders. This makes the Class A shares a more volatile, but potentially more rewarding, investment.

Ninepoint's Strategic Play in Alternatives

Behind this offering is Ninepoint Partners LP, one of Canada’s largest independent alternative investment managers, overseeing approximately $8.2 billion in assets. For Ninepoint, this successful capital raise is more than just an injection of funds; it's a strategic validation of its expertise in creating and managing complex, alternative investment solutions.

In an industry dominated by traditional stock and bond funds, Ninepoint has carved out a niche by offering strategies designed to be uncorrelated with broader market movements, aiming to enhance returns and manage risk. Split share corporations fit perfectly within this mandate. By structuring the investment, Ninepoint can cater to different risk tolerances and market outlooks simultaneously.

The successful completion of this overnight marketing campaign, led by National Bank Financial Inc., reinforces Ninepoint's market position and distribution strength. It demonstrates the firm's ability to not only design sought-after products but also to effectively place them with a broad network of financial advisors and their clients. This continuous flow of capital into its funds is crucial for growing its assets under management and solidifying its reputation as a leader in the Canadian alternative investment space.

The "Canadian Dividend Growth" Blueprint

The $31.6 million in new capital will not be invested arbitrarily. The fund follows a specific and disciplined investment strategy focused on what it defines as "Canadian Dividend Growth Companies." The net proceeds will be used to build an approximately equally-weighted portfolio of equity securities that meet a strict set of criteria.

At its core, the strategy targets large, stable Canadian corporations. Each company must generally have a market capitalization of at least $10 billion, be listed on a Canadian exchange, and pay a dividend. This naturally gravitates the portfolio towards Canada's well-known blue-chip sectors, such as banking, insurance, utilities, and telecommunications.

A key component of the strategy is dividend growth. The portfolio manager selects companies that either have a proven history of increasing their dividends or are viewed as having high potential for future dividend growth. This focus is based on the principle that companies consistently raising dividends are often financially healthy and confident in their future earnings, which can lead to both rising income streams and capital appreciation over time. Furthermore, the strategy requires that the underlying stocks have liquid options available, which allows the portfolio manager to write covered call options. This options strategy is a common feature in split corps, as it generates additional income to help fund the high distributions paid to shareholders, though it can also cap the upside potential of the underlying stocks. While this approach offers a degree of stability and income, it is not without risk. A heavy concentration in a few sectors, a common feature of the Canadian market, can leave the portfolio vulnerable to sector-specific downturns. Moreover, dividends are not guaranteed and can be cut during times of economic stress, which would negatively impact the fund's income and the value of its shares.