TORONTO -- The AutoCanada Income Fund won't be a traditional public company with common shares. It will be an income trust, a hugely popular Canadian financing structure.
Rather than issue shares, it will sell units that will be listed and traded publicly on the Toronto Stock Exchange. Trusts are popular because they don't pay corporate tax; almost all their cash is paid monthly to the owners, who then pay personal tax.
Unit-holders get a vote at the annual meeting, when the trustees are elected.
But that doesn't give them total control. Canada One Auto Group Ltd., which operates the company now, expects to keep at least 20 percent of AutoCanada, a share usually big enough to exercise control.
Also, DaimlerChrysler Canada has to approve unit purchases that would give anyone more than 50 percent of the fund.
