AGF and Acuity Announce Investor Meetings

TORONTO, April 12 /CNW/ - AGF Investments Inc. and Acuity Funds Ltd. today announced special investor meetings will be held on May 18, 2011 to seek approval for mergers or amalgamation of some overlapping AGF and Acuity funds.

"At AGF we are committed to working in the best interests of investors and ensuring the solutions we offer meet their needs," said Gordon Forrester, AGF Executive Vice-President, Marketing & Product and Head of Retail. "Today's announcement is a positive step that will benefit investors. The majority of Acuity and AGF assets are unaffected by the mergers and the Acuity funds will continue to be managed by Acuity managers."

Forrester also noted that merging the Acuity closed-end funds into trust funds will remove the embedded discount to the net asset value (NAV) within these closed-end funds and so provide investors with a fair market price of the security. It will also allow investors to have easier access to a broader suite of products.

The May meetings follow AGF Management Limited's acquisition of Acuity earlier this year.

At the meetings, investors of Acuity retail and pooled funds that are not merging will be asked to approve changes to the applicable declarations of trust at the meetings.  As well, investors are being given notice that Acuity funds' administrative and operations processes, auditors, custodian and documentation are being aligned with AGF's over the next few months.  Proxy circulars are expected to be mailed in the coming week.

AGF and Acuity investors of the merging funds can vote on the proposed mergers of the following trust, closed-end and pooled funds.  All mergers, with the exception of the taxable mergers of Alpha Global Portfolio into AGF Elements Global Portfolio, AGF Canadian All Cap Equity Fund into Acuity All Cap 30 Canadian Equity Fund and Acuity Pooled Dividend Fund into Acuity Pooled Growth & Income Fund, will be done on a tax-deferred basis. As a result, the continuing funds will have a deemed year end on the date of the merger, and thus may be required to pay a distribution on that day.

Trust Fund Mergers:

  • AGF Canadian All Cap Equity Fund into Acuity All Cap 30 Canadian Equity Fund
  • AGF Pure Canadian Balanced Fund into Acuity Conservative Asset Allocation Fund
  • Acuity Canadian Equity Fund into AGF Canadian Stock Fund
  • Acuity Global Dividend Fund into AGF Global Dividend Fund
  • Acuity Global High Income Fund into AGF Global Dividend Fund
  • Acuity Money Market Fund into AGF Canadian Money Market Fund
  • (Acuity) Alpha Balanced Portfolio into AGF Elements Balanced Portfolio
  • (Acuity) Alpha Income Portfolio into AGF Elements Yield Portfolio
  • (Acuity) Alpha Global Portfolio into AGF Elements Global Portfolio
  • (Acuity) Alpha Growth Portfolio into AGF Elements Growth Portfolio
  • Acuity Dividend Fund into Acuity Growth & Income Fund

Closed-End Fund Mergers into Acuity Trust Funds:

  • Acuity Focused Total Return Trust into Acuity Growth & Income Fund
  • Acuity Growth & Income Trust into Acuity Growth & Income Fund
  • Acuity Small Cap Corporation into Acuity Canadian Small Cap Fund

Pooled Fund Merger:

  • Acuity Pooled Dividend Fund into Acuity Pooled Growth & Income Fund

Assets of the closed-end funds will be transferred to the continuing Acuity trust funds at their valuation amounts to calculate net asset value.  The level of distributions of the continuing trust funds will be different than the current distributions for the closed-end funds.  As well, any outstanding loans of the closed-end funds will be paid off prior to the mergers because the continuing trust funds are not permitted to borrow or generally leverage.  A final distribution (including the regular June distribution and any net income or net realized capital gains in the merging closed-end funds) is expected to be paid in cash on July 7, 2011, to investors of record of the affected closed-end funds, prior to the mergers taking effect.

If fees are higher in the continuing fund, existing investors of the merging fund will have their fees grandfathered on existing assets prior to the effective dates of the mergers.

If approved by both investors and regulators, as applicable, the closed-end fund mergers will take effect on or about July 8, 2011, and the trust fund and pooled fund mergers will take effect on or about August 26, 2011.  The final TSX trading date for the closed-end funds is expected to be June 30, 2011.

Investors will also be asked to vote on issues dealing with corporate class funds, including:

  • The amalgamation of Acuity Corporate Class Ltd. ("ACCL") and AGF All World Tax Advantage Group Limited ("AWTAG") (each is a mutual fund corporation that offers classes that are effectively separate corporate class mutual funds) into a single mutual fund corporation also to be known as AGF All World Tax Advantage Group Limited ("Amalco")
  • Merger of Acuity All Cap 30 Canadian Equity Class with AGF Canadian Growth Equity Class, to continue as "AGF Canadian Growth Equity Class" in Amalco
  • Merger of Acuity Natural Resource Class with AGF Global Resources Class, to continue as "AGF Global Resources Class" in Amalco

All other existing classes of AWTAG will continue as classes of Amalco and AGF Investments Inc. will continue as Amalco's investment fund manager.  The two other classes of ACCL not merging (Acuity High Income Class and Acuity Diversified Income Class) will continue as classes of Amalco, to be known as AGF High Income Class and AGF Diversified Income Class.

If approved by both investors and regulators, the proposed amalgamation and corporate class fund mergers will take effect on or about October 1, 2011.

Full details of the proposed changes are being sent to current investors as part of the proxy circulars, and may be obtained by prospective investors from AGF or Acuity prior to the meetings.

About AGF Management Limited
AGF Management Limited is one of Canada's premier independent investment solutions firms with offices across Canada and subsidiaries around the world. AGF's products include a diversified family of award-winning mutual funds, mutual fund wrap programs and pooled funds. AGF also manages assets on behalf of institutional investors including pension plans, foundations and endowments as well as for private clients. In addition, AGF Trust is a complementary business that offers GICs, loans and mortgages through the financial advisor and mortgage broker channels. With approximately $52 billion in total assets under management, AGF serves more than one million investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.

SOURCE AGF

For further information:

Media, please contact AGF Public Relations and Public Affairs:
Susan Yellin       Lucy Becker
Director       Vice-President
416-815-6211, susan.yellin@agf.com   416-865-4284, lucy.becker@agf.com

 

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