Pathway Quebec Mining 2008-II Inc., general partner of Pathway Quebec Mining 2008-II Flow-Through Limited Partnership, has completed the rollover of all its assets on a tax-deferred basis to the Pathway Multi Series Fund Inc., Pathway Asset Management Inc. said Wednesday.
The assets (excluding cash) were exchanged for shares of the fund of the class designated as Mutual Fund Shares, Explorer Series, A/Rollover Series (Mining Class Shares) effective May 4.
The rollover was accomplished 19 months ahead of schedule, at a value of $12.25 per $10 unit, Toronto-based Pathway says.
An investment in limited partnership units of the L.P. were exchanged on a tax-deferred basis for mining class shares with equal value pursuant to an asset purchase agreement dated May 4, between the L.P. and the mutual fund corporation. The limited partners received 2.3428 Mining Class Shares of the mutual fund corporation for each unit held, based on a net asset value per unit of $12.25 and a net asset value per share of $5.23 for each Mining Class Share.
The L.P. had net assets of $13,047,800 at the time of the transfer. The L.P.’s original subscription price in late 2008 was $10 per unit resulting in the after tax return to investors (based on the highest marginal tax rate in Quebec) being 244.59% before factoring in capital gains tax, or 161.51% when capital gains tax is factored in for those investors who do not have past capital losses, but an absolute return of 22.5%.
In other words, in addition to receiving tax breaks of approximately 60¢ on the dollar, each $10 unit was rolled into the mutual fund corporation at $12.25.
Most investors in the L.P. had their money tied up for only six months, Pathway says. This is the third year in a row in which Pathway has rolled over a prospectus offering ahead of schedule.
“Pathway is filled with pride over our ability to deliver to our Quebec and Ontario investors from late 2008 a significantly greater than 100 cents on the dollar return in these very challenging times for junior resource stocks, particularly since the current values of our competitors’ flow-through limited partnerships from the same period are depressed,” said Pathway president Joe Dwek, in a release.
Pathway now has three new prospectus offerings: Pathway Mining 2009 Flow-Through L.P. is available for Canadian residents outside Quebec; Pathway Quebec Mining 2009 Flow-Through L.P. is available for Quebec residents; and Pathway Oil & Gas 2009 Flow-Through L.P. is available for residents throughout Canada.
Pathway Asset Management and its affiliates have raised $568,013,820 in their flow-through limited partnerships to date since their inception.
IE
Pathway rollover completed 19 months ahead of schedule
- By: IE Staff
- May 10, 2009 May 10, 2009
- 13:30