(February 1 – 11:50 ET) – Scotia Capital is launching a new split share mutual fund corporation based on the S&P/TSE 60.

Sixty Split Corp. will hold a portfolio of the common shares of the companies that make up the S&P/TSE 60 Index in order to generate dividend income for the holders of its class A preferred shares and to enable the holders of its class A capital shares to participate in their capital appreciation.

The capital shares and the preferred shares are offered separately but will be issued only on the basis that two capital shares will be issued for each preferred share issued.

The holders of capital shares will be entitled to the benefit of all capital appreciation in the market price of the Portfolio Shares at redemption, after payment of administrative and operating expenses of the fund and a portion of the fixed distribution on the preferred shares. The shares will be redeemed at some point in 2011, depending on when the fund is launched.

Holders of capital shares will not be entitled to receive dividends, although the fund may declare capital gains dividends on the capital shares “in the event that changes to the constituent companies of the S&P/TSE 60 Index generate capital gains”.

Holders of preferred shares will be entitled to receive quarterly fixed cumulative preferential distributions in an amount to be determined.

The fund’s fees are also not yet revealed in the preliminary prospectus.
-IE Staff