PIMCO Multi-Sector Income Fund Completes Initial Public Offering and Private Placement for Aggregate Gross Proceeds of $245 Million

Not for distribution to United States newswire services or for dissemination in the United States

TORONTO, March 10, 2022 (GLOBE NEWSWIRE) -- PIMCO Canada Corp. (the “Manager”) is pleased to announce the closing of the initial public offering of PIMCO Multi-Sector Income Fund (the “Fund”). Pursuant to the offering, the Fund issued an aggregate 7,589,385 Class A Units and an aggregate 13,910,615 Class F Units (together with the Class A Units, the “IPO Units”) for gross proceeds of $215 million.

The Units were issued at a price of $10 per Class A Unit and $9.83 per Class F Unit. However, upon closing of the initial public offering of the Fund, the Manager made a voluntary cash contribution to the Fund of $0.17 per Class F Unit. As a result, the net asset value per Class A Unit and the net asset value per Class F Unit immediately following the closing of the initial public offering were $10.00 and $10.00, respectively.

The Class F Units were then immediately reclassified as Class A Units on a one-for-one basis such that, currently, only Class A Units are outstanding. The Class A Units are listed on the Toronto Stock Exchange under the symbol PIX.UN.

A private placement of 3,000,000 Class P Units of the Fund (together with the IPO Units, the “Units”) was also completed today for gross proceeds of $30 million. The Class P Units were not offered, qualified or issued under a prospectus or pursuant to the agency agreement with the syndicate of Agents. The Class P Units will be reclassified as Class A Units on or about September 12, 2022.

The Fund has been created to invest in an actively managed portfolio of (i) debt obligations and other income-producing securities and instruments of any type and credit quality with varying maturities and related derivatives, and (ii) real estate-related investments. The Manager has retained Pacific Investment Management Company LLC (“PIMCO”), to provide investment management services to the Fund.

The Fund’s investment objectives are to provide holders of Units with current income as a primary objective and capital appreciation as a secondary objective, through various market cycles, by utilizing a dynamic asset allocation strategy among multiple sectors in the global credit markets, including corporate debt, mortgage-related and other asset-backed securities, government and sovereign debt, municipal bonds, other fixed-, variable- and floating-rate income-producing securities of U.S. and global issuers, including emerging market issuers, and real estate-related investments.

The Fund will not have a fixed monthly distribution amount but intends to make cash distributions monthly. The Fund’s monthly distributions are initially targeted to be 5.5% to 6.25% per annum on the initial NAV of $10.00 per Unit (approximately $0.04583 to $0.05208 per Unit per month or $0.55 to $0.625 per annum).¹ The initial cash distribution will be payable to unitholders of record on May 31, 2022, and is expected to be paid on or about June 15, 2022.

The syndicate of Agents in respect of the offering of IPO Units was co-led by RBC Capital Markets, National Bank Financial Inc. and CIBC Capital Markets, and included TD Securities Inc., BMO Capital Markets, Scotiabank, Canaccord Genuity Corp., Raymond James Ltd., Richardson Wealth Limited, Desjardins Securities Inc., Echelon Wealth Partners Inc., Hampton Securities Ltd., iA Private Wealth Inc., and Manulife Securities Inc.

The Fund has granted the Agents an over-allotment option to acquire additional Class A Units at $10.00 per Class A Unit at any time during the next 30 days.

About PIMCO 
PIMCO is one of the world’s premier fixed income investment managers. With its launch in 1971 in Newport Beach, California, PIMCO introduced investors to a total return approach to fixed income investing. In the 45+ years since, the firm continued to bring innovation and expertise to our partnership with clients seeking the best investment solutions. Today PIMCO has offices across the globe and 2,800+ professionals united by a single purpose: creating opportunities for investors in every environment. PIMCO is owned by Allianz SE, a leading global diversified financial services provider.

¹ The target annual distribution rate is not a projection or prediction of future results of the Fund. There can be no assurance that the Fund will achieve the target distribution rate or any particular level of return. Actual results may vary significantly from the target distribution rate.

The offering of IPO Units is only made by prospectus. The prospectus contains important detailed information about the securities being offered. Copies of the prospectus may be obtained from a registered representative of any of the dealers listed in the prospectus. Investors should read the prospectus before making an investment decision.

You will usually pay brokerage fees to your dealer if you purchase or sell Class A Units of the Fund on the Toronto Stock Exchange. If the Class A Units are purchased or sold on the Toronto Stock Exchange, investors may pay more than the current net asset value when buying Class A Units of the Fund and may receive less than the current net asset value when selling them.

There are ongoing fees and expenses associated with owning securities 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 these documents. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.

The Units have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the United States, and may not be offered or sold, directly or indirectly, in the United States (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable securities laws of any state of the United States or in reliance on an exemption from such registration requirements. This news release does not constitute an offer to sell, or a solicitation of an offer to buy any of the Fund’s securities referred to herein in the United States.

Investors should carefully consider the Fund’s investment objectives, risks, charges and expenses before investing. The prospectus, which contains this and other information about the Fund, should be read carefully before investing. The Fund is a newly organized, non-redeemable investment fund, also known as a “closed-end fund”. The Fund is not a complete investment program. Substantially all of the Fund’s portfolio may consist of below investment grade securities (commonly referred to as “high yield” securities or “junk bonds”). An investment in the Fund involves a high degree of risk and should be considered speculative.

You could lose some or all of your investment. For a summary of the risks of an investment in the Fund, please see the “RISK FACTORS” section of the prospectus. Consult your financial advisor before investing. Securities of the Fund are not redeemable at net asset value.

This is not an offer to sell these securities and not a solicitation of an offer to buy these securities in any province or territory where the offer or sale is not permitted and should be accompanied by the prospectus. Before you invest, you should carefully read the Fund’s prospectus and consider carefully the risks you assume when you invest in the Fund’s units. There can be no assurance that the Fund will achieve its investment objectives or be able to structure its investment portfolio as anticipated

Investments made by the Fund and the results achieved by the Fund are not expected to be the same as those made by any other PIMCO-advised fund, including those with a similar name, investment objective or policies. A new or smaller fund’s performance may not represent how the Fund is expected to or may perform in the long-term. New funds have limited operating histories for investors to evaluate and new and smaller funds may not attract sufficient assets to achieve investment and trading efficiencies. The Fund may be forced to sell a comparatively large portion of its portfolio to meet significant unitholder redemptions for cash, or hold a comparatively large portion of its portfolio in cash due to significant unit purchases for cash, in each case when the Fund otherwise would not seek to do so, which may adversely affect performance.

A word about risk: As a new fund, the Fund has no operating history for investors to evaluate and new and smaller funds may not attract sufficient assets to achieve investment and trading efficiencies. The Fund has a limited term provision. Unless the limited term provision is amended or the Fund converts to perpetual existence, the Fund will terminate on or about the Termination Date (as defined in the prospectus). Investors may receive more or less than their original investment upon termination. Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk. The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies with longer durations tend to be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and low interest rate environments increase this risk. Reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Bond investments may be worth more or less than the original cost when redeemed. Investing in foreign-denominated and/or -domiciled securities may involve heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets. Sovereign securities are generally backed by the issuing government. Obligations of U.S. government agencies and authorities are supported by varying degrees, but are generally not backed by the full faith of the U.S. government. Portfolios that invest in such securities are not guaranteed and will fluctuate in value. High yield, lower-rated securities involve greater risk than higher-rated securities; portfolios that invest in them may be subject to greater levels of credit and liquidity risk than portfolios that do not. The use of leverage may cause a portfolio to liquidate positions when it may not be advantageous to do so to satisfy its obligations or to meet segregation requirements. Leverage, including borrowing, may cause a portfolio to be more volatile than if the portfolio had not been leveraged. Derivatives may involve certain costs and risks, such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested. Diversification does not ensure against loss.

The Fund may invest directly or indirectly in securities of stressed or distressed issuers, which include securities at risk of being in default as to the repayment of principal and/or interest at the time of acquisition by the Fund or that are rated in the lower rating categories by one or more nationally recognized statistical rating organizations (for example, Ca or lower by Moody’s or CC or lower by S&P or Fitch) or, if unrated, are determined by PIMCO to be of comparable quality. Debt instruments of below investment grade quality (below Baa3 by Moody’s or below BBB- by S&P or Fitch) are regarded as having predominantly speculative characteristics with respect to capacity to pay interest and to repay principal, and are commonly referred to as “high yield” securities or “junk bonds.” Debt instruments in the lowest investment grade category also may be considered to possess some speculative characteristics. The Fund may, for hedging, investment or leveraging purposes, make use of credit default swaps, which are contracts whereby one party makes periodic payments to a counterparty in exchange for the right to receive from the counterparty a payment equal to the par (or other agreed-upon) value of a referenced debt obligation in the event of a default or other credit event by the issuer of the debt obligation.

This material was prepared solely for informational purposes and does not constitute an offer or an invitation by or on behalf of PIMCO to any person to buy or sell any security. Any securities, sectors or allocations referenced may or may not be represented in portfolios of clients of PIMCO or its affiliates, and do not represent all of the securities purchased, sold or recommended for client accounts. The reader should not assume that any investments in securities, sectors and/or markets identified or described were or will be profitable. Investing entails risks, including possible loss of principal.

PIMCO Canada Corp. (“PIMCO Canada” or the “Manager”) is the investment fund manager, portfolio manager, trustee and promoter of the Fund. The Manager is responsible for creating, structuring, managing and promoting the Fund and providing portfolio management services to the Fund. The Manager has retained Pacific Investment Management Company LLC (“PIMCO” or the “Sub-Adviser”) to provide investment management services to the Fund.

This material may contain certain statements which constitute “forward-looking statements”. Forward-looking statements include, among other things, projections, estimates, and information about possible or future results related to the fund, market, or regulatory developments. The views expressed herein are not guarantees of future performance or economic results and involve certain risks, uncertainties, and assumptions that could cause actual outcomes and results to differ materially from the views expressed herein. The views expressed herein are subject to change at any time based upon economic, market, or other conditions and the fund undertakes no obligation to update the views expressed herein. While we have gathered this information from sources believed to be reliable, the Fund cannot guarantee the accuracy of the information provided. Any discussions of specific securities should not be considered a recommendation to buy or sell those securities. The views expressed herein (including any forward-looking statement) may not be relied upon as investment advice or as an indication of the Fund’s trading intent. Information included herein is not an indication of the Fund’s future portfolio composition. This is not an offer to any person in any jurisdiction where unlawful or unauthorized.

THE FUND SHOULD BE CONSIDERED AS ONLY ONE ELEMENT OF A COMPLETE INVESTMENT PROGRAM. AN INVESTMENT IN THIS FUND SHOULD BE CONSIDERED SPECULATIVE.

CLOSED-END FUNDS FREQUENTLY TRADE AT A DISCOUNT TO THEIR NET ASSET VALUES.

PIMCO as a general matter provides services to qualified institutions, financial intermediaries and institutional investors. Individual investors should contact their own financial professional to determine the most appropriate investment options for their financial situation. This material contains the current opinions of the Manager and such opinions are subject to change without notice. This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management of America L.P. in the United States and throughout the world. ©2022, PIMCO

The products and services provided by PIMCO Canada Corp. may only be available in certain provinces or territories of Canada and only through dealers authorized for that purpose.

PIMCO Canada has retained PIMCO LLC as sub-adviser. PIMCO Canada will remain responsible for any loss that arises out of the failure of its sub-adviser.

PIMCO Canada Corp. 199 Bay Street, Suite 2050, Commerce Court Station, P.O. Box 363, Toronto, ON, M5L 1G2, 416-368-3350

Contact:
Agnes Crane
PIMCO – Media Relations
Ph. 347-952-8954
Email: [email protected]