Canadian retail investors snap up new water fund

Published March 5th, 2015

Retail investors in Canada had their first chance to gain exposure to KBI’s $1.6 billion global water strategy last Friday, when the Global Water Solutions Fund (GWSF) priced its IPO on the Toronto Stock Exchange.

The closed-end fund, promoted by Canadian bank BMO Nesbitt Burns, raised gross proceeds of Can$27.5 million to invest in a portfolio of publicly listed water stocks, and is aiming to generate an annual yield of 4.00%. According to the fund prospectus, the top ten holdings in the indicative portfolio include Suez Environnement and Pentair, but exclude Veolia and Xylem, while the portfolio as a whole has a 59% weighting towards North America. Water utilities will form 20% of the mix, and water technology companies 21%.

Kleinwort Benson Investors will actively manage the GWSF going forward, ensuring that the fund’s investors benefit from a high degree of industry expertise, as well as economies of scale.