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The Royal Canadian Mint has announced that it is making an initial public offering of exchange-traded receipts (ETRs) under
the mint’s new Canadian Gold Reserves program. Unlike other gold investment products currently available which only enable the purchaser to own a unit or share in an entity that owns the gold, the ETRs will enable the purchaser to actually own the physical gold bullion which will be held in the custody of the mint at its facilities in Ottawa, Ontario. Unfortunately, the ETRs have not, and will not, be registered under the U.S. Securities Act of 1933 and, as such, may not be offered or sold in the U.S. Words: 745
So says The Royal Canadian Mint (www.mint.ca) in a release* which Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), has further edited ([ ]), abridged (…) and reformatted below for the sake of clarity and brevity to ensure a fast and easy read. The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.
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Says Ian E. Bennett, president and CEO of the Royal Canadian Mint:
We believe that this new program will build on our reputation and continued success as a world-class custodian of precious metals. With the introduction of the Canadian Gold Reserves ETR program we hope that investors will see this as a convenient, efficient, and secure method for investing in and owning physical gold.
The net proceeds of the offering will be used to purchase gold on behalf of the initial purchasers of ETRs at the London p.m. fix price on the closing date of the offering which is expected to occur in late November 2011 . Subject to certain restrictions, ETR holders will be entitled to redeem their ETRs for physical gold products in the form of 99.99 per cent pure gold bars or coins, or for cash based on the future gold price or market price of the ETRs.
Subject to market conditions, the initial offering of ETRs is targeting an issue size of approximately C$250 million. The issue price per ETR will be C$20 or the U.S. dollar equivalent and the Per ETR Entitlement to Gold will be determined on the closing date and will be reduced daily by an annual service fee of 0.35 per cent.
Subject to the satisfaction of certain conditions, the ETRs will be listed on the Toronto Stock Exchange and commence trading on the closing date. ETRs will be listed in both Canadian and U.S. dollars and may be traded in either currency.
Through a competitive process, the Mint has selected a syndicate of investment dealers led by TD Securities Inc. and National Bank Financial Inc., and including BMO Nesbitt Burns Inc., CIBC World Markets Inc., RBC Dominion Securities Inc., Canaccord Genuity Corp., Cormark Securities Inc., MGI Securities Inc., and Raymond James Ltd. to distribute the ETRs on a best efforts agency basis. The offering is being made on a prospectus-exempt basis pursuant to the terms of an order of the Ontario Securities Commission dated August 30, 2011.
This media release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any offer, solicitation or sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Note: An investment in the ETRs involves a degree of risk. These risks result primarily from fluctuations in the price of gold. A detailed description of these risks and other important information about the ETRs and the Canadian Gold Reserves ETR program is contained in the Information Statement. A prospective investor in ETRs should review and carefully consider the risks described in the Information Statement, a copy of which may be obtained in reasonable quantities by contacting TD Securities Inc.. ETR holders will have no recourse to the Mint or the Government of Canada for any loss on their investment.
About the Royal Canadian Mint
The Royal Canadian Mint is the Crown Corporation responsible for the minting and distribution of Canada’s circulation coins. An ISO 9001-2008 certified company, the mint is recognized as one of the largest and most versatile mints in the world, offering a wide range of specialized, high quality coinage products and related services on an international scale.
*http://www.mint.ca/store/news/royal-canadian-mint-announces-offering-of-new-gold-investment-product-13100003?cat=News+releases&nId=700002&parentnId=600004&nodeGroup=About+the+Mint
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This is yet another ‘paper’ gold. It is not allocated, but the Mint undertakes have the physical gold in custody to cover the ETRs. Physical redemption must be in respect of a minimum of 10,000 ETRs.
There are many other terms and conditions of this offering — See the Information Statement at http://www.investorvillage.com/uploads/8056/files/productinfo.201110311231112641B.EN.pdf
The Mint does have the advantage of being distanced from the contagion zone of financial institutions. Remember though that the Canadian authorities sold almost all of Canada’s gold reserves when it was fashionable to do so. Gold in custody at the Mint could be a sitting duck for government action in an economic emergency, at which time they might just take title to the gold and pay ETR holders paper money for it.
If you want gold to insure wealth preservation, this is not really a substitute for the real thing in your possession.
Canada, along with 99% of the other nations, is still monetarily controlled by the Rothschilds. Therefore, this is just another way for the government of Canada to take the peoples money, buy gold, yet the people will never have it in their hands. When the music stops, only the government will have gold, not the people.
There is no substitute for the saying, if you do not hold it in your hands, you don’t own squat!