TORONTO, March 7, 2019 /CNW/ - 1832 Asset Management L.P., Trustee and Manager of ScotiaFunds, today announced that it will seek regulatory and unitholder approval for the following mergers:
Scotia Latin American Fund
Scotia International Equity Fund
Scotia Pacific Rim Fund
If approved, the proposed mergers are expected to take effect as of the close of business on July 12, 2019. The Independent Review Committee of the Terminating Funds and Continuing Fund has provided 1832 Asset Management L.P. with a positive recommendation for the mergers on the basis that they achieve a fair and reasonable result for the Terminating Funds and Continuing Fund.
Each merger will require the approval by a majority of the votes cast by unitholders of the applicable Terminating Funds and Continuing Fund at a special meeting of such unitholders, expected to be held jointly on or about June 14, 2019 (the "Special Meetings"). The record date for the purpose of determining which unitholders are entitled to receive notice and vote at the Special Meetings will be the close of business on or about April 25, 2019. A management information circular containing a complete description of the matters to be considered at the Special Meetings will be made available to affected unitholders after the record date.
Each of the mergers will take place on a taxable basis, which would be considered a deemed disposition for tax purposes and may have tax consequences for unitholders of the Terminating Funds if held within a non-registered account.
For each merger that is approved, unitholders of the applicable Terminating Funds will receive units of the equivalent series of the Continuing Fund on a dollar-for-dollar basis. The Terminating Funds will then be wound up as soon as possible following the mergers.
Fixed Administration Fee Reduction
If the mergers are approved, the Manager is also proposing a 10 basis point reduction in the Fixed Administration Fee ("FAF") for Series A and Series F of the Scotia International Equity Fund. With the reduction from 0.35% to 0.25%, the FAF of the Continuing Fund after the merger will be lower than that of the Terminating Funds. The fee reduction will take effect on or about July 12, 2019. The Management Fee for the Terminating Funds and Continuing Fund are the same and will remain unchanged.
Suspension of New Purchases
Effective as of the close of business on March 15, 2019, purchases of units of the Terminating Funds will be suspended including purchases under existing pre-authorized contribution plans. Unitholders will have the right to redeem units of the Terminating Fund up to the close of business on the business day immediately before the merger date, on or about July 8, 2019.
Following each merger, if implemented, unitholders can re-establish a pre-authorized contribution plan or automatic withdrawal plan with respect to the Continuing Fund by contacting their advisor or registered dealer.
Rationale for Mergers
The proposed mergers are a result of the Manager's ongoing review of the fund lineup and are believed to be in the best interest of unitholders of the Terminating Funds and Continuing Funds. All unitholders are expected to benefit from the increased scale and operational efficiencies of a larger Continuing Fund, post-merger. The mergers will also provide unitholders of the Terminating Funds with enhanced regional diversification with potentially less volatility.
Commissions, trailing commissions, management fees and expenses may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed or insured by the Canada Deposit Insurance Corporation or any other government deposit insurer, their values change frequently and past performance may not be repeated.
About 1832 Asset Management
1832 Asset Management offers a range of wealth management solutions, including mutual funds, and investment solutions for private clients, institutional clients and managed asset programs. 1832 Asset Management is a limited partnership, the general partner of which is wholly owned by Scotiabank.
Scotiabank is Canada's international bank and a leading financial services provider in the Americas. We are dedicated to helping our more than 25 million customers become better off through a broad range of advice, products and services, including personal and commercial banking, wealth management and private banking, corporate and investment banking, and capital markets. With a team of more than 98,000 employees1 and assets of over $1 trillion (as at January 31, 2019), Scotiabank trades on the Toronto Stock Exchange (TSX: BNS) and New York Stock Exchange (NYSE: BNS). For more information, please visit www.scotiabank.com and follow us on Twitter @ScotiabankViews.
1Employees are reported on a full-time equivalent basis.
For further information: For media enquiries only: Alexandra Mathias, Canadian Banking Communications, Scotiabank, [email protected], 416-448-7044