Brompton Equity Split Corp.
TSX : BE

Brompton Equity Split Corp.
Dividend Growth Split Corp.
TSX : DGS

Dividend Growth Split Corp.

April 13, 2011 10:19 ET

Brompton Funds Declare Distributions

TORONTO, ONTARIO--(Marketwire - April 13, 2011) - Brompton Funds (TSX:BE)(TSX:DGS) announces distributions payable on May 13, 2011 to Class A shareholders of record at the close of business on April 29, 2011 for the following funds:

Fund NameTickerAmount Per Share
Brompton Equity Split Corp.BE$ 0.10
Dividend Growth Split Corp.DGS$ 0.10

Shareholder meetings of BE and DGS were held on April 8, 2011 and shareholders approved the resolutions as described in the joint management information circular dated March 11, 2011 (the "Circular") to merge the funds. As a result, the funds are scheduled to merge on May 18, 2011. Following the merger, the name of the continuing fund will be Dividend Growth Split Corp.

Holders of preferred shares of BE will receive preferred shares in DGS with approximately a 3.5 year term and an attractive 5.25% yield. Holders of Class A shares in BE will receive Class A shares in DGS and benefit from the higher distribution yield based on their relative net asset values. In addition, BE shareholders are expected to benefit as Preferred shares and Class A shares of DGS have traded at an average combined premium to Net Asset Value per unit of 9.2% for the 12 months ended February 28, 2011 while shares of BE have traded at a discount to net asset value per unit over the same period.

The merger is expected to be beneficial to shareholders of BE and DGS for the following reasons:

  • ENHANCED LIQUIDITY – Following the merger, DGS is expected to have a larger market capitalization and a greater number of shareholders and shares outstanding, than BE or DGS separately do, which is expected to enhance trading liquidity.
  • ENHANCED REDEMPTION ENTITLEMENT – DGS offers quarterly redemptions at net asset value less costs.
  • LOWER MANAGEMENT EXPENSE RATIO – The merger is expected to reduce operational costs on a per unit basis and correspondingly improve returns by spreading fixed costs over a greater number of shares.
  • LOW MANAGEMENT FEE - The management fee for DGS following the merger will remain at 0.6% of net asset value per annum. The management fee for BE is 1.0% of net asset value.

Details concerning the merger are provided in the Circular or for further information, please contact your financial advisor, call our investor relations line at 416-642-9051 (toll-free at 1-866-642-6001) or visit our website at www.bromptonfunds.com.

Commissions, trailing commissions, management fees and expenses all may be associated with investment funds. Please read the fund's publicly filed documents which are available from SEDAR at www.sedar.com. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.

Forward-Looking Statements

Certain statements contained in this news release constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking information may relate to matters disclosed in this press release and to other matters identified in public filings relating to the Fund, to the future outlook of the Fund and anticipated events or results and may include statements regarding the future financial performance of the Fund. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Actual results may vary from such forward-looking information.

Contact Information

  • Brompton Funds Management Limited
    Chris Cullen
    Senior Vice President
    (416) 642-9064