TORONTO, ONTARIO--(Marketwired - June 30, 2016) -
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
BMO Nesbitt Burns Inc., the administrator (the "Administrator") of Coxe Commodity Strategy Fund (TSX:COX.UN) announces that BMO Asset Management Corp. will resign as investment manager of the fund effective October 7, 2016.
The Administrator is pleased to announce that it intends to merge Coxe Global Agribusiness Income Fund, Coxe Commodity Strategy Fund and Global Water Solutions Fund (the "Merger"), resulting in Global Water Solutions Fund being the continuing fund (the "Continuing Fund") and Coxe Global Agribusiness Income Fund and Coxe Commodity Strategy Fund being the terminating funds (collectively the "Terminating Funds" and together with the Continuing Fund, the "Funds"). BMO Nesbitt Burns Inc. is the administrator of each of the Funds.
The proposed Merger is subject to regulatory and unitholder approval. Separate special unitholder meetings (the "Meetings") of each of the Funds are expected to be held concurrently on or about August 30, 2016. For the purposes of the Meetings, the record date is expected to be on or about July 29, 2016. Upon receipt of all necessary approvals, it is expected that the Merger will be implemented on or about October 7, 2016. The Terminating Funds will be wound up as soon as reasonably practicable following the Merger.
At the Meetings, unitholders of the respective Funds will be asked to consider and approve, among other things, the Merger and all related transactions. A notice and joint management information circular, which will include details of the matters to be considered at the Meetings, will be mailed to unitholders of the Funds and available on www.sedar.com.
It is anticipated that unitholders of the Funds will benefit from the Merger due to reduced costs to unitholders, increased economies of scale, a larger asset base for the Continuing Fund and enhanced liquidity through expected higher trading volume on the Toronto Stock Exchange ("TSX") of units of the Continuing Fund. Unitholders of the Terminating Funds will also benefit from the lower fee structure of the Continuing Fund, including a lower management fee.
As Global Water Solutions Fund will be the continuing fund, unitholders of the Terminating Funds wishing to participate in the Merger will transition to an investment in an actively managed global portfolio comprised primarily of publicly-listed equity securities of global companies across the water cycle that are providing solutions to water scarcity. The Continuing Fund pays quarterly cash distributions to unitholders, which are currently targeted to be $0.10 per unit ($0.40 per annum). The Continuing Fund has made all its distributions since inception in January 2015. Kleinwort Benson Investors International Ltd. ("KBI") is the portfolio manager of the Continuing Fund and is responsible for implementing the investment strategy of the Continuing Fund. KBI is an institutional asset manager headquartered in Dublin, Ireland, managing approximately US$9 billion in assets as at March 31, 2016, including approximately US$1 billion in water related strategies. The firm has been managing assets since 1980 and currently manages specialist equity strategies which are offered to institutional investors on both a segregated and unitized basis. KBI has recently entered into an agreement with Amundi Asset Management ("Amundi"), pursuant to which, subject to required approvals, Amundi will acquire a majority stake in KBI. This transaction is expected to close in the third quarter of 2016. Amundi is Europe's largest asset management company with assets under management in excess of US$1 trillion.
If the Merger is approved by unitholders of the Funds at the Meetings, unitholders of the Terminating Funds who do not wish to be part of the Merger will have the option to redeem their units for cash at net asset value as a special redemption right which will be granted prior to the Merger. Unitholders can wait until after the results of the Meetings are announced before choosing to exercise the special redemption right. The Merger will be effected at the net asset value of each Terminating Fund. The Merger is conditional upon the approval of unitholders of the Funds, the TSX and applicable securities regulatory authorities.
The Units of Coxe Global Agribusiness Income Fund are listed on the TSX under the symbol CAG.UN. The Class A Units of Coxe Commodity Strategy Fund are listed on the TSX under the symbol COX.UN. The Units of Global Water Solutions Fund are listed on the TSX under the symbol HTO.UN.
Certain statements included in this news release constitute forward-looking statements, including, but not limited to, those identified by the expressions "expect", "intend", "will", "estimate" and similar expressions to the extent they relate to the Funds and the Administrator. The forward-looking statements are not historical facts but reflect the current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Although the Funds and the Administrator believe that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. Neither the Funds nor the Administrator undertake any obligation to update publicly or otherwise revise any forward-looking statement or information whether as a result of new information, future events or other such factors which affect this information, except as required by law.