Harvest Files Preliminary Prospectus for Harvest Canadian Consolidated Energy Fund IPO

October 29, 2019

OAKVILLE, ON, Oct. 29, 2019 /CNW/ – Harvest Portfolios Group Inc. (“Harvest” or the “Manager”) is pleased to announce that the Harvest Canadian Consolidated Energy Fund (the “Fund”) has filed a preliminary prospectus in respect of an initial public offering of units of the Fund (“Units”) at a price of $12.00 per Unit.

The Fund’s investment objectives are to provide holders of Units (“Unitholders”) with: (i) quarterly cash distributions; and (ii) the opportunity for capital appreciation through investments primarily in listed Equity Securities of companies operating in the Canadian Energy Universe.

In selecting the Canadian Energy Issuers from the Canadian Energy Universe, the Manager may give consideration to: (i) each issuer’s fundamental balance sheet position; (ii) each issuer’s opportunity for financial growth; (iii) production costs for commodity producing issuers; (iv) the experience of the issuer’s management team; (v) oil and natural gas production allocation; and (vi) overall portfolio energy sub-sector diversity. Approximately 80% of the Fund’s net assets will be invested in up to 19 Canadian Energy Issuers on an equal-weight basis (the “Canadian Portfolio”) and approximately, but not more than, 20% of the Fund’s net assets will be invested in the U.S. dollar denominated units of the Harvest Energy Leaders Plus Income ETF in order to gain exposure primarily to global Energy Issuers. The Canadian Portfolio will be reconstituted and rebalanced within 30 days following the end of each calendar quarter following March 31, 2020.

The Manager intends that on or about June 15, 2021, the Fund will, subject to applicable law, which may require Unitholder and/or regulatory approval, convert into or merge by way of a tax-deferred merger with an exchange-traded mutual fund, in each case managed by the Manager (or an affiliate) (any such converted or merged fund being the “Converted Fund”). It is the Manager’s intention that the Converted Fund will have a substantially similar investment strategy to that of the Fund and accordingly, it will invest primarily in securities of companies in the energy sector.

Prospective purchasers investing in the Fund have the option of paying for Units in cash or by exchanging securities of issuers listed in the preliminary prospectus. Prospective purchasers who elect to pay for Units using the exchange option are required to deposit their exchange eligible securities prior to 5:00 p.m. (Toronto time) on November 22, 2019, in the manner described in the preliminary prospectus.

The initial quarterly cash distribution target for the Fund is $0.12 per Unit per quarter ($0.48 per annum) to yield 4% on the subscription price per Unit. The initial quarterly cash distribution will be payable to unitholders of record on March 31, 2020.

Harvest will act as the manager and portfolio manager of the Fund and will provide or arrange for all administrative services required by the Fund.

The syndicate of agents for the offering is being co-led by BMO Capital Markets, CIBC Capital Markets, RBC Capital Markets, Scotiabank, National Bank Financial Inc., TD Securities Inc., and also includes Canaccord Genuity Corp., GMP Securities L.P., Raymond James Ltd., Desjardins Securities Inc., Echelon Wealth Partners Inc., Industrial Alliance Securities Inc., Mackie Research Capital Corporation, Manulife Securities Incorporated and PI Financial Corp.

 

All capitalized terms used but not defined herein are as defined in the preliminary prospectus.

A preliminary prospectus dated October 29, 2019 (the “Prospectus”) containing important information relating to these securities has been filed with securities commissions or similar authorities in each of the provinces and territories of Canada. The Prospectus is still subject to completion or amendment. Copies of the Prospectus may be obtained from any of the agents. There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the final prospectus has been issued.

Certain statements included in this news release constitute forward-looking statements, including, but not limited to, those identified by the expressions “expect”, “intend”, “will” and similar expressions to the extent they relate to the Fund or the Manager. The forward-looking statements are not historical facts but reflect the Manager’s 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. Although the Manager believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. The Manager undertakes no obligation to update publicly or otherwise revise any forward-looking statement or information whether as a result of new information, future events or other such factors which affect this information, except as required by law.

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Disclaimer

You will usually pay brokerage fees to your dealer if you purchase or sell units of the Fund(s) on the TSX. If the units are purchased or sold on the TSX, investors may pay more than the current net asset value when buying units of the Fund(s) and may receive less than the current net asset value when selling them. There are ongoing fees and expenses associated with owning units of an investment fund. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about the fund in these documents.

Certain statements in the Harvest Blog are forward looking Forward-looking statements (“FLS”) are statements that are predictive in nature, depend upon or refer to future events or conditions, or that include words such as “may,” “will,” “should,” “could,” “expect,” “anticipate,” “intend,” “plan,” “believe,” or  “estimate,” or other similar expressions. Statements that look forward in time or include anything other than historical information are subject to risks and uncertainties, and actual results, actions or events could differ materially from those set forth in the FLS.

FLS are not guarantees of future performance and are by their nature based on numerous assumptions, which include, amongst other things, that (i) the Fund can attract and maintain investors and have sufficient capital under management to effect their investment strategies, (ii) the investment strategies will produce the results intended by the portfolio managers, and (iii) the markets will react and perform in a manner consistent with the investment strategies. Although the FLS contained herein are based upon what the portfolio manager believe to be reasonable assumptions, the portfolio manager cannot assure that actual results will be consistent with these FLS.

Unless required by applicable law, Harvest Portfolios Group Inc. does not undertake, and specifically disclaim, any intention or obligation to update or revise any FLS, whether as a result of new information, future events or otherwise.

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