Acuity Funds Ltd. has filed a preliminary prospectus for the initial public offering of units of Acuity Diversified Total Return Trust.
The trust is a closed-end investment trust whose investment objectives are:
- to provide unitholders with monthly distributions;
- to enhance the long-term total return within the portfolio of the trust; and (iii) to return to unitholders upon the termination of the trust at least the original issue price ($10 per unit) of the units.
Acuity will provide investment advisory and portfolio management services to the trust. The trust will invest in an actively managed diversified portfolio of securities consisting primarily of units of income funds and to a lesser extent equity securities, including primarily dividend paying shares, which Acuity believes have the potential for substantial growth.
From time to time, Acuity may change the proportion of income funds to equity securities to reflect market conditions.
The trust will annually determine and announce an indicative distribution amount for the following 12 months based upon the prevailing market conditions and the Manager’s estimate of distributable cash flow for the year. The indicative distribution for the first 12 months of the Trust is 70¢ per unit representing a yield of 7% based on the $10 per unit issue price. The Trust may make additional distributions in any given year.
Acuity was formed in 1990 and, as of November 30, 2005, had assets under management of approximately $7.2 billion, of which about $3 billion were invested in the income fund sector.
A syndicate of agents is being led by CIBC World Markets Inc. and includes RBC Dominion Securities Inc., BMO Nesbitt Burns Inc., National Bank Financial Inc., Scotia Capital Inc., TD Securities Inc., HSBC Securities (Canada) Inc., Canaccord Capital Corp., Desjardins Securities Inc., Dundee Securities Corp., Raymond James Ltd., Wellington West Capital Inc., Berkshire Securities Inc., Blackmont Capital Inc., GMP Securities L.P. and IPC Securities Corp.