TORONTO, ONTARIO--(Marketwired - April 4, 2016) -
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.
Monegy High Yield Bond Fund (the "Fund") is pleased to announce that it has obtained a receipt for its preliminary prospectus for the initial public offering (the "Offering") of Class A Units and Class T Units of the Fund (collectively, the "Units"). The Class T Units are designed for fee-based and/or institutional accounts. The Class A Units will not be listed on a stock exchange, but will be convertible into Class T Units on a weekly basis.
The Units are being offered for $10.00 per Unit and the manager of the Fund, BMO Nesbitt Burns Inc. (the "Manager"), will pay all fees and all expenses of the Offering exceeding 0.50% of the gross proceeds of the Offering. As a result, the net asset value per Unit immediately following the closing of the Offering will be at least $9.95. The Manager is also the promoter of the Fund and one of the agents in connection with the Offering.
The Fund uses the Unit Traded Fund (UTF) structure which has been developed to accomplish two goals: (i) to enable the Fund to invest substantially all of the gross proceeds from the Offering in the Portfolio (as defined below); and (ii) to encourage the Class T Units to trade in the market at a price not less than 98.5% of their net asset value throughout the life of the Fund.
The Fund's investment objectives are to provide holders of Units (the "Unitholders") with a high level of total return through a combination of: (i) monthly cash distributions; and (ii) the opportunity for capital appreciation, by investing in a portfolio comprised primarily of high yield fixed income securities issued by U.S. corporations (the "Portfolio") actively managed by Monegy, Inc. ("Monegy"). The Fund aims to provide access to the high yield fixed income markets that would otherwise be difficult for retail investors to obtain directly.
The Fund's monthly distributions are initially targeted to be $0.05 per Class A Unit ($0.60 per annum per Class A Unit) representing an annual yield of 6.0% on the $10.00 per Class A Unit issue price and $0.0583 per Class T Unit ($0.70 per annum per Class T Unit) representing an annual yield of 7.0% on the $10.00 per Class T Unit issue price.
Monegy will be responsible for implementing the investment strategies of the Fund. Monegy is the boutique high yield asset management specialist within BMO Global Asset Management, and is ultimately owned by the Bank of Montreal. Monegy has been managing high yield bond and loan portfolios for 16 years, and offers investors a broad suite of fund vehicles, including separate accounts for investments over $50 million, mutual funds, pooled funds or collective investment trusts. As of February 29, 2016, Monegy had US$1.8 billion in total assets under management.
The syndicate of agents for the Offering is being co-led by BMO Capital Markets, CIBC, National Bank Financial Inc. and Scotiabank, and also includes, Canaccord Genuity Corp., GMP Securities L.P., Raymond James Ltd., Desjardins Securities Inc., Global Securities Corporation, Industrial Alliance Securities Inc., Laurentian Bank Securities Inc., Mackie Research Capital Corporation, Manulife Securities Incorporated and PI Financial Corp.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities of the Fund have not been registered under the U.S. Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws and may not be offered or sold in the United States or to a U.S. person absent registration under the 1933 Act or an applicable exemption from the registration requirements of the 1933 Act and applicable state securities laws.
A preliminary prospectus containing important information relating to these securities has been filed with securities commissions or similar authorities in each of the provinces and territories of Canada. The preliminary prospectus is still subject to completion or amendment. Copies of the preliminary prospectus may be obtained from any of the agents listed above. There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the final prospectus has been issued.
Contact Information:
1.866.864.7760