TORONTO, Oct. 2, 2020 /CNW/ - CI Investments Inc. ("CI")
today announced that it is merging three exchange-traded funds
("ETFs") into other investment funds with identical mandates. The
mergers are part of CI's ongoing initiative to streamline and
modernize its fund lineup and will result in continuing funds with
a dual-class structure that offers both mutual fund and ETF
series.
The mergers will be effected at the close of business on or
about January 15, 2021, and relate to
the CI Liquid Alternatives™ fund offerings. Details are as
follows:
- CI Lawrence Park Alternative Investment Grade Credit ETF (TSX:
CRED, CRED.U) will be merged into CI Lawrence Park Alternative
Investment Grade Credit Fund.
- CI Marret Alternative Absolute Return Bond ETF (TSX: CMAR,
CMAR.U) will be merged into CI Marret Alternative Absolute Return
Bond Fund.
- CI Munro Alternative Global Growth ETF (TSX: CMAG) will be
merged into CI Munro Alternative Global Growth Fund.
No action is required by securityholders in the merging ETFs.
The ticker symbols of each merging ETF will carry over to the ETF
series of the continuing funds, and the fund codes for the mutual
fund series will not change. For each merger, the investment
objectives and the portfolio management team for the merging ETF
and continuing investment fund are identical and will not change
due to the merger.
The benefits of the dual-class structure, which CI introduced
earlier this year, include reducing the duplication of funds,
simplifying CI's lineup, creating larger funds with greater
economies of scale and portfolio diversification opportunities, and
increasing the consistency of fund performance between different
fund structures with the same mandates.
CI's lineup of liquid alternative funds also includes CI Marret
Alternative Enhanced Yield Fund, which was introduced in
May 2020 with the dual-class
structure that includes both ETF and mutual fund series.
Please note that the continuing funds pay fixed administration
fees in exchange for CI bearing most operating expenses. The
fixed administration fee charged to each continuing fund will be
the same as or lower than the operating expenses currently being
paid by the corresponding merging ETF. Fixed administration fees
offer several benefits to investors, including greater
predictability and transparency of the MER for each fund, as well
as protection from potential increases in future operating
expenses.
Details of the mergers
Following the mergers,
securityholders of the merging ETFs will receive the equivalent
dollar amount in units of the appropriate series of the continuing
mutual fund. Common Units will be exchanged for ETF C$ Series units
of the continuing fund, and US$ Common Units will be exchanged for
ETF US$ Hedged Series units of the continuing fund. There will be
no taxable disposition for securityholders as a result of the
mergers, though the funds may pay a distribution at that time. The
costs and expenses associated with the mergers are being borne by
CI, not the funds.
The mergers will not require regulatory or securityholders'
approval. However, securityholders of the merging ETFs will be
notified of the mergers in accordance with applicable securities
laws.
CI has applied to list the ETF series units of the continuing
funds on the Toronto Stock Exchange (the "TSX"). Listing of
those ETF series units is subject to the approval of the TSX in
accordance with its original listing requirements. The TSX has
conditionally approved CI's listing application and subject to
satisfying the TSX's original listing requirements, the ETF series
units of the continuing funds will be listed on the TSX and
investors will be able to buy or sell such units on the TSX through
registered brokers and dealers in the province or territory where
the investor resides.
The Independent Review Committee of the merging funds has
reviewed the proposed mergers with respect to potential conflict of
interest matters and provided its approval, having determined that
the mergers achieve a fair and reasonable result for each of the
funds.
More information about CI Liquid Alternatives can be found at
www.ci.com/liquidalts.
About CI Investments
CI Investments is one of
Canada's largest investment
management companies. It offers a wide range of investment products
and services and is on the Web at www.ci.com. CI is a subsidiary of
CI Financial Corp. (TSX: CIX), an independent company offering
global asset management and wealth management advisory services
with $189 billion in assets as of
August 31, 2020.
Commissions, trailing commissions, management fees and
expenses all may be associated with an investment in mutual funds
and exchange-traded funds (ETFs). Please read the prospectus before
investing. Important information about mutual funds and ETFs is
contained in their respective prospectus. Mutual funds and ETFs are
not guaranteed; their values change frequently and past performance
may not be repeated. You will usually pay brokerage fees to your
dealer if you purchase or sell units of an ETF on recognized
Canadian exchanges. If the units are purchased or sold on these
Canadian exchanges, investors may pay more than the current net
asset value when buying units of the ETF and may receive less than
the current net asset value when selling them.
This communication is provided as a general source of
information and should not be considered personal, legal,
accounting, tax or investment advice, or construed as an
endorsement or recommendation of any entity or security discussed.
Individuals should seek the advice of professionals, as
appropriate, regarding any particular investment. Investors should
consult their professional advisors prior to implementing any
changes to their investment strategies.
The CI Funds are managed by CI Investments Inc., a subsidiary
of CI Financial Corp., which is listed on the Toronto Stock
Exchange under the symbol "CIX".
CI Investments and the CI Investments design are registered
trademarks of CI Investments Inc. CI Liquid Alternatives is a
trademark of CI Investments Inc.
©CI Investments Inc. 2020. All rights reserved.
SOURCE CI Investments Inc.
