Manulife Brompton Advantaged Bond Fund has filed a final prospectus for a $100 million initial public offering, Brompton Funds Management Ltd. said Tuesday.

The fund is offering two classes of units, Class A and Class F units, each at a price of $10 per unit. Class F units are designed for fee-based accounts and will not be listed on a stock exchange.

The fund’s investment objectives are to provide unitholders with attractive monthly tax-advantaged cash distributions together with the opportunity for capital appreciation. Distributions are initially targeted to be 70¢ annually per Class A unit or Class F unit consisting primarily of return of capital, representing a yield on the issue price of 7% annually. The fund will seek to achieve its investment objectives through exposure to an actively managed bond portfolio consisting primarily of North American corporate bonds.

Bompton Funds has selected MFC Global Investment Management (Canada), a part of the asset management division of Manulife Financial Corp., to manage the portfolio. MFC Global and related entities manage approximately $250 billion in assets, including over $145 billion in fixed income securities. MFC Global is also the portfolio manager of the Manulife Corporate Bond Fund.

MFC Global believes that an attractive opportunity currently exists to invest in corporate bonds because they provide high yields relative to government bonds and equities, current spreads of corporate bonds over government bonds are near their highest level since the 1930s, and bonds historically recover in advance of equity markets after a market correction.

In addition, the MFC Global believes that government bonds are currently overvalued relative to corporate bonds and an opportunity exists to enhance portfolio returns by selling short government bonds and investing the proceeds in additional corporate bonds.

The Toronto Stock Exchange has conditionally approved the listing of the Class A units. Trading of Class A units under the symbol MBB.UN is expected to start on April 23, the date of closing.

The syndicate of agents for the offering is being co-led by RBC Capital Markets and CIBC World Markets Inc. and includes Scotia Capital Inc., TD Securities Inc., BMO Nesbitt Burns Inc., National Bank Financial Inc., HSBC Securities (Canada) Inc., Manulife Securities Incorporated, Canaccord Capital Corp., Desjardins Securities Inc., Raymond James Ltd., Blackmont Capital Inc., Dundee Securities Corp., Research Capital Corp., Wellington West Capital Markets Inc., M Partners Inc. and Richardson Partners Financial Ltd.

IE