Greenhouse Canada

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Converting from trust to corporate structure


January 2, 2010
By Dave Harrison

Jan. 2, 2010, Vancouver – Vegetable
grower Village Farms Income Fund (TSX:VFF.UN) completed its conversion to a
corporate structure last Thursday, a year before most types of Canadian income
trusts will lose tax advantages.



Jan. 2, 2010, Vancouver – Vegetable
grower Village Farms Income Fund (TSX:VFF.UN) completed its conversion to a
corporate structure last Thursday, a year before most types of Canadian income
trusts will lose tax advantages.

Senior vice-president and CFO
Stephen Ruffini said Thursday’s transition comes at the end of the company’s
tax year and will be beneficial to shareholders. “It made sense to change on
our year end, so it doesn’t create two tax years, which would have been an
incremental cost to our company … so it made sense to do it on Dec. 31st.”

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Ruffini added that switching to a
corporate structure will also make it easier to complete growth plans the
Vancouver-based greenhouse operator has for the coming year.

“Being stuck as an income trust
would have made those growth plans more challenging to accomplish,” he said.

The producer of greenhouse-grown
tomatoes, bell peppers and cucumbers will begin trading Jan. 5 on the Toronto
Stock Exchange as a publicly listed corporation. The new company will trade
under Village Farms International, Inc. (TSX:VFF). The fund’s ordinary trust
units will be delisted.

The conversion comes exactly a year
before most income trusts are slated to lose tax advantages Dec. 31, 2010 as
part of reforms announced in October 2006 by Finance Minister Jim Flaherty.
Shares of Village Farms International Inc. (TSX:VFF), the name of the new
corporation, begin trading on Jan. 5 and the fund’s units will be delisted.
Trust units were trading down a per cent to 72 cents apiece on the Toronto
Stock Exchange on Thursday.

 

 


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