Central Fund of Canada Ltd. (TSX: CEF.A; CEF.U) (NYSE Amex: CEF) has entered an underwriting agreement with CIBC World Markets Inc., as the lead underwriter, and Credit Suisse Securities (Canada) Inc., under which the underwriters have agreed to buy and sell to the public, in Canada and in the U.S. under the multijurisdictional disclosure system, 23,600,000 Class A Shares of Central Fund.
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The underwriters have received the right to increase the size of the offering by up to an additional 1,700,000 Class A Shares, exercisable in whole or in part at any point before 4:00pm (EST) on May 11, 2010. The offering will be made under a second prospectus supplement to the Fund’s $1,000,000,000 base shelf prospectus dating September 8, 2009.
The purchase price of $14.85 per Class A Share is expected to results in gross proceeds of about $350 million. All of the net proceeds of the offering have been committed to purchase gold and silver bullion for settlement at closing.
Central Fund of Canada Limited (Central Fund) is an investment holding company. The Company is a specialized, passive holding company with most of its assets held in gold and silver bullion. Central Fund’s purpose is to hold gold and silver bullion on a secure basis for the convenience of investors in the shares of Central Fund.
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