Stefan Spicer is opening up his Central Gold Trust (GTU) for expansion in a very classy way, making it non-dilutive of NAV so as to not penalize the existing unit holders.
Well done indeed. An excellent response to surging market demand. The Spicers once again show the way to respond to their customers.
It will be interesting to see how quickly this offering sells. Since the Central Gold Trust holds its bullion in a strict allocation it represents a potentially large physical offtake in a tight bullion market as the move to hard assets continues.
And as an aside, it is so nice to be able to trade Canadian securities on the American exchanges. Anyone who trades the Canadian junior miners on the 'pink sheets' is all too familiar with the spread games and bid dodging the market makers are playing these days.
For Immediate Release toCanada News Wire and U.S. Disclosure Circuit
TSX SYMBOLS: GTU.UN (Cdn. $) and GTU.U (U.S. $)
NYSE AMEX EQUITIES SYMBOL: GTU (U.S. $)
CENTRAL GOLDTRUST ANNOUNCES PROPOSED OFFERING
TORONTO, Ontario (June 15, 2010) - Central GoldTrust of Ancaster, Ontario announced today that it plans to offer Units of Central GoldTrust to the public in Canada (except Québec) and in the United States under its existing U.S.$800,000,000 base shelf prospectus dated June 8, 2009 and filed with the securities commissions in each of the provinces and territories of Canada, except Québec, and under the multijurisdictional disclosuresystem in the United States pursuant to a proposed underwritten offering by CIBC.
Central GoldTrust will only proceed with the offering if it is non-dilutive to the net asset value of the Units owned by the existing Unitholders of Central GoldTrust.
The entire original amount of U.S.$800,000,000 provided for in the base shelf prospectus is available for this offering.
Substantially all of the net proceeds of the offering will be used for gold bullion purchases, in keeping with the asset allocation provisions outlined in Central GoldTrust’s Declaration of Trust and the related policies established by its Board of Trustees. Any additional capital raised by the offering is expected to assist in reducing the annual expense ratio in favour of all Unit holders of Central GoldTrust...Read this entire news release here.
