TORONTO, April 21, 2014 /CNW/ - NewGrowth Corp. (the "Company")
announced today that the final condition required to extend the term of
the Company for an additional five years to June 26, 2019 has been met
as holders of 97.2% of Class A Capital Shares have elected to extend.
Holders of Class A Capital Shares previously approved the extension of
the term of the Company subject to the condition that a minimum of
1,287,000 Class A Capital Shares remain outstanding after giving effect
to the special retraction right (the "Special Retraction Right").
Under the Special Retraction Right, 72,755 Class A Capital Shares have
been tendered to the Company for retraction on June 26, 2014. The
holders of the remaining 2,500,623 Class A Capital Shares will continue
to enjoy the benefits of a leveraged participation in the capital
appreciation of the Company's portfolio while potentially deferring any
capital gains tax liability which would otherwise be realized on the
redemption of their Class A Capital Shares. As part of the extension,
the Company's portfolio of common shares of Canadian chartered banks,
telecommunication, utility and pipeline companies will be expanded to
include selected issuers in the oil and gas sector and will be
rebalanced to equal weight.
The Company's Class B preferred shares, Series 2 (the "Series 2
Preferred Shares") will be redeemed by the Company on June 26, 2014 in
accordance with their redemption provisions at a price per share equal
to the lesser of $13.70 and the Net Asset Value per Unit. In order to
maintain the leveraged "split share" structure of the Company, the
Company intends to create and issue a third series of Class B preferred
shares (the "Series 3 Preferred Shares"), which are expected to be
issued immediately following this redemption. In addition, the Company
may also undertake a concurrent public offering of additional Class A
Capital Shares at the same time the Series 3 Preferred Shares are
NewGrowth Corp. is a mutual fund corporation whose Class A Capital
Shares and Preferred Shares are listed for trading on the Toronto Stock
Exchange under the symbols NEW.A and NEW.PR.C respectively.
SOURCE: NewGrowth Corp.
For further information:
Web site: www.scotiamanagedcompanies.com