Tree Island Wire Income Fund looking to convert to corporate structure

VANCOUVER – Tree Island Wire Income Fund (TSX:TIL.UN, TSX:TIL.DB) said Thursday it will ask its unitholders to approve a conversion of the company from a trust to a corporation.

The trust said the proposed reorganization would result in a plan of arrangement effective Jan. 1, 2013.

Tree Island said the change would simplify the tax and legal structure of the company and reduce internal and external administrative costs.

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The change will require approval by a two-thirds majority of votes at a meeting of unitholders scheduled for Sept. 13.

“The proposed structural changes will not deter Tree Island’s objective of returning to profitability, but are necessary for taxation strategies,” Tree Island chairman Amar Doman said in a statement.

Ottawa moved to change the tax rules governing income trusts to tax them more like corporations starting in 2011.

Tree Island sells a variety of different kinds of wire and nails as well as stucco reinforcing products, engineered structural mesh, fencing and other fabricated wire products.