XPost: ab.general, ab.politics, calgary.general   
   XPost: can.taxes, ont.politics   
   From: ceri@shawRemoveThis.ca   
      
   It's purely a tax grap nothing more. Adolf Harper needs money badly, really   
   badly. He's cut GST overspent on military equipment with no thought to   
   support or operation costs. Given money back to people with kids in daycare   
   and with all that money going out not in. Now with his taxation on coporate   
   Canada the bill will go onto us citizens like always and furthering the   
   people and corporate Canada away from Adolf Harper and his fellow Nazi's. I   
   can't see a hope in hell of him getting in again except for those oil   
   companies happy with his about face in eviromental issues. He's like George   
   W. Hitler the people of do nothing or as little as possible. He's been in   
   office for over a year and what good has he done yet to better life in   
   Canada. I can't think of a thing yet.   
      
      
   "Canuck57"  wrote in message   
   news:W0Ckh.535526$R63.516938@pd7urf1no...   
   >   
   > Looks like the Halloween Trust announcement is having unintended side   
   > effects....   
   >   
   > Government think things out?  Hardly.  Was good for Canadians while it   
   > lasted, but now I guess the foreigners are going to own it.  Nice go   
   > Harpo.   
   >   
   > ---   
   >   
   >      2007 will be full of takeover and consolidation in income trust   
   > market   
   >      Wed Dec 27, 2:51 PM   
   >   
   >   
   > By Judy Monchuk   
   >   
   > CALGARY (CP) - Takeovers and consolidation will be common themes for   
   > income trusts over the next 12 months as the industry copes with the   
   > reality of the four-year phaseout of its tax-free status.   
   >   
   > Following the Halloween bombshell dropped by Federal Finance Minister Jim   
   > Flaherty that knocked trusts for a multibillion-dollar loop, the real   
   > question is how many will be left standing at the end of 2007.   
   >   
   > A lot fewer than the 256 which currently exist, says George Kesteven,   
   > president of the Canadian Association of Income Funds.   
   >   
   > "Those infrastructure assets... have been somewhat vaporized over the last   
   > six or seven weeks," said Kesteven, who worries about the far-reaching   
   > ramifications of American interests potentially taking over the Canadian   
   > funds.   
   >   
   > Already, private equity firms have begun to move in to pick up trust   
   > assets they view as undervalued or struggling. U.S.-based Harbinger   
   > Capital Partners made an $831-million hostile takeover bid for Calpine   
   > Power Income Trust (CF-UN.TO) on Dec. 19.   
   >   
   > "We appreciate their capital, but what will happen is you've essentially   
   > shifted the mind and management of these entities and their assets out of   
   > the country," said Kesteven.   
   >   
   > "If that was truly the intended consequence that Minister Flaherty had in   
   > mind, I'd be surprised. I suspect this was yet another one of these   
   > unintended consequences (indicating) this thing was put together on the   
   > back of an envelope."   
   >   
   > The industry maintains Ottawa didn't properly investigate the   
   > ramifications of its Oct. 31 decision, which sent trust values spiralling   
   > down billions of dollars. Guidelines released Dec. 15 indicate the   
   > government will allow individual trusts to double in size without   
   > forfeiting their tax-free status and merge without penalty, but that may   
   > not provide enough access to growth capital for some.   
   >   
   > The income funds have been around since 1984, launched as a way for energy   
   > companies to sell aging wells no longer growing in production to companies   
   > focused on squeezing the most oil or gas out of the ground.   
   >   
   > But the explosion in popularity of trusts as an investment vehicle has   
   > been fairly recent. Trusts were worth $20 billion in capital market volume   
   > in 2000, an amount which had grown to $200 billion just prior to the Oct.   
   > 31 announcement. Planned trust conversions by Telus Corp. (T.TO), BCE Inc.   
   > (BCE.TO), and EnCana Corp (ECA.TO) would have seen that value swell to   
   > $300 billion.   
   >   
   > Ottawa balked as it saw the trust market poised to embrace the corporate   
   > giants, worried that such moves could impact the tax system and corporate   
   > competitiveness.   
   >   
   > The biggest concentration in 2007 will likely occur in the oilpatch, where   
   > energy trusts are an important link in the food chain between small junior   
   > exploration companies and the major players, who are focused on developing   
   > resource plays that often require billions of dollars in capital.   
   >   
   > Although energy trust assets often complement each other, they require   
   > constant growth to replenish their declining reserves. Calgary-based oil   
   > and gas trusts claimed six of the Top 10 funds on the Toronto Stock   
   > Exchange - all of which lost heavily in the wake of what the investment   
   > community has dubbed the "Halloween massacre."   
   >   
   > Energy officials doubt a mid-sized sector will spring up to fill the role   
   > played by the trusts. That sector all but evaporated several years ago   
   > when companies, for varying reasons, hit a point where they could no   
   > longer grow profitably.   
   >   
   > "Your investor base is interested in growth, they're no longer satisfied   
   > with your returns and you flounder while you're trying to convert over to   
   > something different," said Sue Riddell Rose of Paramount Energy Trust   
   > (PMT-UN.TO), co-chair of the Coalition of Canadian Energy Trusts.   
   >   
   > "We saw a lot of foreign companies come in and take over basically the   
   > entire intermediary sector in 2000, 2001," said Rose. "We don't think the   
   > intermediate sector will do any better the next time around than it did   
   > last time."   
   >   
   > Any stream of takeovers will wait until after tax lawyers have had a   
   > chance to fully digest the fine print in Flaherty's proposed legislation,   
   > released the evening of Dec. 21.   
   >   
   > But portfolio manager Cecilia Mo of Fidelity Investments doubts there will   
   > be a stampede of movement.   
   >   
   > "If that's going to become reality, they're going to make the best of the   
   > next four years - enjoy the next four-year tax holiday and slowly   
   > transitioning," said Mo.   
   >   
   > The trusts have refused to accept defeat and aren't going quietly.   
   >   
   > So-called "education campaigns" will be rolled out early in the new year   
   > to try and convince Canadians that the government's decision was wrong -   
   > lobbying efforts estimated to cost millions. Those campaigns will focus on   
   > the Harper government's minority status and hope to make it an election   
   > issue.   
   >   
   > Trust officials note that most investors only truly became aware of the   
   > extent of their losses after receiving financial statements in mid   
   > December.   
   >   
   > Still, others say it's time to accept the inevitable.   
   >   
   > A report by accounting and consulting firm Deloitte following Flaherty's   
   > original announcement found that more than half of executives surveyed   
   > believe there will be fewer than 50 trusts by 2011.   
   >   
      
   [continued in next message]   
      
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