Brompton Proposes Merger of Symphony Floating Rate Senior Loan Fund With Brompton Wellington Square Investment Grade CLO ETF

TORONTO, Sept. 12, 2025 (GLOBE NEWSWIRE) -- (TSX: SSF.UN) Brompton Funds Limited (“Brompton” or the “Manager”), the manager of Symphony Floating Rate Senior Loan Fund (the “Fund”) announces that it has approved a proposal to merge (the “Merger”) the Fund into Brompton Wellington Square Investment Grade CLO ETF (the “ETF”) with the ETF being the continuing fund (the “Continuing Fund”) and it is calling a special meeting (the “Meeting”) of the holders (the “Unitholders”) of class A units and class U units (together the “Units”) of the Fund to consider and vote on the proposed Merger.

The ETF is a new investment fund which the Manager expects to launch in late September 2025.

Under the Merger, the class A units and class U units of the Fund will be exchanged for CAD units and USD units of the ETF, respectively, based on the respective net asset value (“NAV”) of the applicable classes.

The investment objectives of the ETF are to provide its unitholders with high monthly income and capital preservation through investment in a portfolio of primarily investment grade rated collateralized loan obligations (“CLOs”) (being CLOs rated BBB- or higher (or an equivalent rating thereto) by a designated rating organization) (“Investment Grade CLOs”). The ETF seeks to hedge substantially all of its direct foreign currency exposure back to the Canadian dollar. However, any exposure that the ETF’s assets allocable to its USD units have to foreign currencies will not be hedged back to the Canadian dollar.

A CLO is a bond issued by a CLO investment vehicle (“CLO Issuer”). A CLO Issuer offers a series of CLO bond tranches to investors, ranging from higher (AAA) to lower (B) credit quality. The CLO Issuer uses the proceeds to buy an actively managed, diversified portfolio of senior loans which are posted as collateral to secure the interest and principal repayment of the CLOs issued. An Investment Grade CLO is a higher quality CLO generally rated BBB- and higher.

The Manager believes that the Merger, if approved by the Unitholders, will provide Unitholders with several benefits including the following:

• Higher Credit Quality:   Currently, the average credit rating of the senior loans held in the Fund’s portfolio is B+, a credit rating that is considered non-investment grade. At least 75% of the Continuing Fund’s portfolio will be invested in Investment Grade CLOs. Issuers of Investment Grade CLOs are considered less likely to default on repayment of principal or payment of interest than issuers of below investment grade rated loan obligations.
  
  
• Lower Management Expense Ratio: The combined portfolio management and management fee payable by the Fund is currently 1.25% of the Fund’s NAV plus applicable taxes (the “Management Fee”). The management fee payable by the Continuing Fund will be 0.60% plus applicable taxes. As of June 30, 2025, the management expense ratio (“MER”) of the Fund, excluding the cost of borrowing, of the class A units and class U was 2.29%, reflecting the Management Fee, plus operating expenses and applicable taxes paid by the Fund. The Manager will pay for certain of the Continuing Fund’s operating costs and expenses which are operating costs and expenses that the Fund currently pays for and included in the MER for the Fund. Accordingly, the MER for Unitholders, excluding borrowing costs, is expected to be reduced from 2.29% to less than 0.75% per annum.
  
  
• Elimination of Borrowing: The Continuing Fund will not borrow to carry out its investment strategy. Accordingly, the Manager expects that the Fund’s borrowing costs will be eliminated contributing to the reduction in MER and reduction in volatility as the use of borrowing can enhance the movement in a fund’s net portfolio valuations.
  
  
• Continued Focus on High Distributions: The Fund’s current distribution rate is 7.26% based on the NAV of the class A units on September 11, 2025. Similar to the Fund’s investment objectives, which includes providing Unitholders monthly distributions, the Continuing Fund’s investment objectives will include providing Unitholders with high monthly income.   
  
  
• Reduced Bid/Ask Spread: Unlike closed-end funds which may have fluctuating bid/ask spreads, market makers for exchange-traded funds are able to price their bids and asks for units of an exchange-traded fund close to their estimated net asset value. Accordingly, the Manager expects that the bid/ask spread for the Continuing Fund will be significantly reduced from the Fund’s current bid/ask spread. This is beneficial to investors because a smaller bid/ask spread is expected to result in a lower effective cost to buy or sell units of the Continuing Fund.
  
  
• Increased Trading Liquidity: Following the Merger, approved dealers acting as market makers for the Fund will be able to offer or bid for large volumes of units of the Continuing Fund on the Toronto Stock Exchange (the “TSX”), as approved dealers have the ability to create or redeem units daily in large blocks directly from the Continuing Fund. This is expected to result in improved trading liquidity of the units as it will allow an investor to buy or sell large amounts of units of the Continuing Fund without materially affecting the market price for the units. It is expected that the USD Units of the Continuing Fund will, subject to satisfying the TSX’s original listing requirements, be listed and traded on the TSX with direct trading liquidity on the TSX so the holders of class U units of the Fund would no longer be required to convert their class U units to class A units in order to sell their class U units on the TSX.
  
  
• Trading Closer to NAV: The Fund is currently a closed-end fund. Closed-end funds often trade on a stock exchange at a premium or a discount to NAV. Over the past year, to August 31, 2025 the Fund has traded at an average discount to NAV of 2.8%. The units of the Continuing Fund are expected to trade on the TSX at or near the NAV, due to improved liquidity provided by market-making dealers who will set the bid and offer prices closer to NAV.

All costs of the Merger, including with respect to the Meeting, will be borne by the Manager.

If the Merger is approved by Unitholders, the Fund expects to offer an accelerated annual redemption option on December 30, 2025, payable on or about January 9, 2026.

The Fund will hold the Meeting on November 17, 2025 to consider and vote on the proposed Merger and acceleration of the Fund’s annual redemption date. Unitholders of record at the close of business on October 17, 2025 will be entitled to vote at the Meeting. The proposed Merger will be subject to any required regulatory approvals. Details of the proposed Merger will be further outlined in the Fund’s notice of meeting and management information circular that will be prepared and delivered to Unitholders in connection with the Meeting and will be available on www.sedarplus.ca and posted on Brompton’s website at www.bromptongroup.com. If approved, the Merger is expected to be implemented on or about January 13, 2026.

About Brompton Funds
Founded in 2000, Brompton is an experienced investment fund manager with income and growth focused investment solutions including exchange-traded funds (ETFs) and other TSX traded investment funds. For further information, please contact your investment advisor, call Brompton’s investor relations line at 416-642-6000 (toll-free at 1-866-642-6001), email info@bromptongroup.com or visit our website at www.bromptongroup.com.

Returns are for the periods ended August 31, 2025 and are unaudited. Inception date November 1, 2011. The table shows the Fund’s compound return for each period indicated. Past performance does not necessarily indicate how the Fund will perform in the future. The performance information shown is based on net asset value per Class A unit and Class U unit and assumes that cash distributions made by the Fund during the periods shown were reinvested at net asset value per Class A unit and Class U unit in additional units of the Fund.

You will usually pay brokerage fees to your dealer if you purchase or sell units of the investment fund on the TSX or other alternative Canadian trading system (an “exchange”). If the units are purchased or sold on an exchange, investors may pay more than the current net asset value when buying units of the investment fund and may receive less than the current net asset value when selling them.

There are ongoing fees and expenses associated with owning units of an investment fund. An investment fund must prepare disclosure documents that contain key information about the Fund. You can find more detailed information about the Fund in the public filings available at www.sedarplus.ca. The indicated rates of return are the historical annual compounded total returns including changes in the unit value and reinvestment of all distributions and do not take into account certain fees such as redemption costs or income taxes payable by any securityholder that would have reduced returns.  Investment funds are not guaranteed, their values change frequently and past performance may not be repeated. The amount of distributions may fluctuate from month to month and there can be no assurance that the Fund will make any distribution in any particular month.  

Commissions, trailing commissions, management fees and expenses all may be associated with exchange-traded fund investments.  Please read the prospectus before investing.  Exchange-traded funds are not guaranteed, their values change frequently and past performance may not be repeated.

Certain statements contained in this document constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking information may relate to matters disclosed in this document and to other matters identified in public filings relating to the Fund, the ETF and the Continuing Fund, to the future outlook of the Fund, the ETF and the Continuing Fund and anticipated events or results and may include statements regarding the future financial performance of the Fund, the ETF and the Continuing Fund. In some cases, forward-looking information can be identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue” or other similar expressions concerning matters that are not historical facts. Actual results may vary from such forward-looking information. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no obligation to update or revise them to reflect new events or circumstances.

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