/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES./
TORONTO, Sept. 28, 2012 /CNW/ - Connor, Clark & Lunn Capital Markets Inc. (the "Manager") is pleased to announce that a final prospectus for U.S. Agency Mortgage-Backed REIT Advantaged Fund (the "Fund") has been filed and receipted by the securities regulatory authorities of all the Canadian provinces and territories for an initial public offering of Class A Units and Class F Units (the "Units") of the Fund. The Fund is a closed-end investment fund established under the laws of the Province of Ontario which proposes to offer Units at a price of $10.00 per Unit. The maximum amount of the offering is $100 million and is expected to close on or about October 23, 2012. The Toronto Stock Exchange ("TSX") has conditionally approved the listing of the Class A Units under the symbol USM.UN. Class F Units will not be listed but may be converted into Class A Units on a weekly basis.
The Fund will obtain exposure to a portfolio of the 10 largest publicly traded U.S. Agency Mortgage REITs by market capitalization. U.S. Agency Mortgage REITs are REITs which invest primarily in mortgage-backed securities that are issued or guaranteed by the U.S. government or a government-sponsored enterprise thereby minimizing their credit risk associated with the underlying mortgages. U.S. Agency Mortgage REITs comprising the Portfolio will be weighted based on their market capitalization, subject to a limit of 25% of the Portfolio being invested in any one Agency Mortgage REIT, at the time of investment or rebalancing. The Portfolio will be rebalanced at least semi-annually.
The Fund's investment objectives are to (i) provide tax-advantaged quarterly cash distributions consisting primarily of returns of capital; and (ii) provide low-cost exposure to the Portfolio. Based on current estimates and the assumptions set in the preliminary prospectus, the Fund's initial distribution target is expected to be $0.20 per Unit per quarter, representing an initial yield on the Unit issue price of 8% per annum, consisting primarily of returns of capital which are not immediately taxable but which reduce a Unitholder's adjusted cost base of its Units.
Connor, Clark & Lunn Capital Markets Inc. will act as Manager of the Fund. The Manager is part of the Connor, Clark & Lunn Financial Group, a multi-boutique asset management firm.
The Units are being offered for sale by a syndicate of agents co-led by BMO Capital Markets and CIBC, and including Scotiabank, Raymond James Ltd., Canaccord Genuity Corp., GMP Securities L.P., Macquarie Private Wealth Inc. and Mackie Research Capital Corporation.
This offering is only made by prospectus. The prospectus contains important detailed information about the securities being offered. Copies of the prospectus may be obtained from any of the above-mentioned agents. Investors should read the prospectus before making an investment decision..
SOURCE: U.S. Agency Mortgage-Backed REIT Advantaged Fund
For further information:
please visit www.cclcapitalmarkets.com or contact:
Vice President & CFO
Connor, Clark & Lunn Capital Markets Inc.
(416) 214-6182 or 1 (888) 276-2258