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TORONTO, Jan. 8, 2013 /CNW/ - Scotia Managed Companies Administration Inc., on behalf of Top 20 Europe Dividend Trust (the "Fund"), is pleased to announce that the Fund has completed the issuance of 100,000 Units for gross proceeds of $1,000,000. The issuance was pursuant to the exercise of the over-allotment option granted to the agents in connection with the Fund's recently completed initial public offering. With the exercise of the over-allotment option, total gross proceeds raised by the Fund are Cdn$31,000,000. The Units of the Fund are listed and posted for trading on the Toronto Stock Exchange under the symbol TTE.UN.
The Fund's investment objectives are to: (i) provide Unitholders with stable quarterly tax-advantaged distributions; (ii) provide Unitholders with the opportunity for capital appreciation; and (iii) mitigate the impact of foreign exchange exposure through the use of currency hedging strategies.
The Fund will obtain investment exposure, on a tax-advantaged basis, to an equally-weighted portfolio (the "Portfolio") comprised of the 20 highest yielding equity securities included in the Europe Dow, a regional index of the Dow Jones Industrial Average ("The Europe Dow"). The Europe Dow measures the stock market performance of 30 leading publicly traded blue-chip companies from Western Europe. Highstreet Asset Management Inc. (the ''Portfolio Manager and Options Advisor'') will write covered call options from time to time in respect of not more than 33% of the Portfolio in order to earn income from option premiums to supplement the dividends and distributions generated by the Portfolio. The Portfolio Manager and Options Advisor will generally only write covered calls to the extent needed to increase the yield on the Portfolio to a targeted yield.
The Portfolio will be reconstituted annually to include the then top 20 highest yielding constituents of The Europe Dow on an equally-weighted basis. The Portfolio will also be rebalanced to an equal weight basis prior to the end of each calendar quarter.
The Fund intends to make quarterly cash distributions to Unitholders of record on the last business day of the months of March, June, September and December. The Fund intends to pay equal quarterly distributions initially expected to be $0.1625 per Unit ($0.65 per annum) representing an annual yield of 6.50% on the issue price, consisting primarily of returns of capital, which are not immediately taxable but which reduce a Unitholder's adjusted cost base of its Units.
The Units were offered for sale by a syndicate of agents led by Scotiabank and including BMO Capital Markets, National Bank Financial Inc., TD Securities Inc., Canaccord Genuity Corp., Desjardins Securities Inc., GMP Securities L.P., Raymond James Ltd., Burgeonvest Bick Securities Limited, Dundee Securities Ltd., Mackie Research Capital Corporation, Macquarie Private Wealth Inc., and Manulife Securities Incorporated.
Certain statements included in this news release constitute forward-looking statements. The forward-looking statements are not historical facts but reflect current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. Scotia Managed Companies Administration Inc. undertakes no obligation to update publicly or otherwise revise any forward looking statement whether as a result of new information, future events or other such factors which affect this information, except as required by law. Investment funds are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer. There is no assurance that the Fund will be able to achieve its distribution and capital preservation objectives or that the full amount of a unitholders investment in the Fund will be returned. The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or any applicable exemption from the registration requirements. The press release does not constitute an offer to sell or the solicitation of an offer to buy securities nor will there be any sale of such securities in any state in which such offer, solicitation or sale would be unlawful.
SOURCE: Top 20 Europe Dividend Trust
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