Income Trusts—A Maturing Capital Markets Sector

In the past two years, the income trust has developed into an extremely widespread and versatile vehicle for acquiring and repackaging an increasingly diverse range of businesses in an effort to maximize value. A widely cited statistic for 2002 is that almost 90% of Canadian initial public offerings in that year were made through income trusts, with roughly 45 businesses effectively being sold to the public through income trust offerings. As of early September, 2003, activity remained strong, with 17 equity offerings by new issuers and 12 follow-up equity offerings by existing issuers being announced or completed.

This Blakes Bulletin on Income Trusts describes some recent developments in the income trust area. As readers will note, the developments strongly suggest a growing maturity in the sector. Two broad themes are worthy of note in that regard. Firstly, as income trusts solidify their presence in the capital markets, regulatory and governmental authorities are considering the