The Royal Canadian Mint has announced an IPO of an exchange-traded receipts (ETR) fund backed by physical silver bullion. The initial offering is reportedly a mammoth C $100 million. Each ETR will reportedly be priced at $20, and can be redeemed for either cash of physical silver.
While we always advocate physical bullion metal held in your own personal possession, the launch of the Canadian Mint’s silver ETR could have drastic implications on the physical silver market.
The Royal Canadian Mint said it will make an initial public offering of C$100 million in silver exchange-traded receipts.
The Mint will offer exchange-traded receipts, priced at $20 each, which can be redeemed for silver or cash. The Mint said it has entered into an agreement with a syndicate of underwriters pursuant to which the Underwriters have agreed to purchase from the Mint and sell to the public 5,000,000 exchange-traded receipts (“ETRs”) issued under the Mint’s Canadian Silver Reserves Program.
The offering is expected to close on November 5, 2012 with gross proceeds of C$100,000,000. “The goal is to offer investors an exchanged-traded investment vehicle that tracks the price of silver and makes investing directly in physical silver available to institutional and retail investors,” said the Mint.