New Altamira fund focuses on digital economy

Don Tapscott, Intelligent Enterprise Corporation to advise on e-business fund

TORONTO, Nov. 17 /CNW/ - Altamira Investment Services Inc. today announced the launch of the Altamira e-business Fund, a new mutual fund targetting those companies that are taking advantage of opportunities in the digital economy. It is the first of its kind in Canada. It is available in Ontario and, subject to regulatory approval which is expected shortly, in all other provinces. The e-business fund will be managed by Altamira's Technology Team consisting of Ian Ainsworth, Lead Manager, David Cooke and Stephen Masson. Through a strategic partnership, the new fund will also benefit from the analytical insight and market acumen of Intelligent Enterprise Corporation (IEC), the financial industry consulting affiliate of the Alliance for Converging Technologies, and from Alliance Chairman Don Tapscott, one of the world's leading authorities on the digital economy.

E-business Defined

E-business refers to the use of the Internet for purchasing a rapidly growing range of goods and services including financial services, travel and entertainment; and for conducting business-to-business transactions. The e-business market encompasses companies that are adopting e-business strategies as well as those that both create and service these new electronic business channels.

"Most technology funds today focus solely on vendors or suppliers, but that is only half of the story," commented Mr. Ainsworth. "The real story is how different sectors are using technology to build new business opportunities, move closer to customers, create more efficient operations and reduce costs. We will identify and invest in those sectors and companies that are doing so." The fund is the result of a strategic partnership formed in June 1998 between Altamira and Intelligent Enterprise Corporation to take advantage of investment opportunities in the rapidly growing electronic business market. IEC and Tapscott will help Altamira anticipate technological advances and business innovations that hasten the growth of emerging companies or cause existing top performers to adopt new e-business strategies for competitive advantage.

Exponential Growth

A recent OECD study forecasts that the current $26 billion US global e-business market will "explode" to a trillion dollars in the next seven years. Another study estimates that Internet commerce between businesses in the U.S. alone will reach 2.3% of that country's Gross Domestic Product by the year 2002 and 6% by 2006. (U.S. GDP in 1997 was $6.618 trillion US, according to the OECD).

"Networked communications technology, driven by the Internet and its protocols, are fueling the exponential growth of e-business worldwide," said Mr. Tapscott, "and there is no question that the segment will grow faster than the economy as a whole." "But even among e-business companies, there will be winners and also-rans," continued Mr. Tapscott. "To ride that top trend line of winners, we've built a team that combines the financial skills of Canada's leading technology-driven investment managers and the market acumen of Intelligent Enterprise Organization. We're confident the Altamira e-business Fund is well-equipped to deliver superior long-term returns from this exciting new segment of the economy."

Portfolio Strategy

Managers will use a combination of "sector specific" and "company specific" approaches to stock selection and invest only in companies perceived to be able to quickly achieve and sustain a competitive advantage using Internet technology. This will include:

• New companies that are organizing the delivery of their products, services and key business processes around the Internet and other emerging networked communications technologies;
• Established small, medium, and large brand-name companies that are achieving a competitive advantage by deploying effective e-business strategies; and
• Suppliers of software, hardware, communications, information and business services that provide the enabling e-business infrastructure.

As the fund is invested in a specific area of the economy, high unit price volatility is likely. However, investments in emerging Internet companies will be offset by investments in more established companies who are adopting e-business strategies. The Fund will be 20% eligible for RRSP investment.

A Winning Team

"This new fund reinforces Altamira's reputation as an innovator in the mutual fund industry and it keeps us at the cutting edge in delivering wealth management products and services to clients," concluded Altamira President and CEO Gord Cheesbrough. "We are proud to have Don Tapscott and Intelligent Enterprise Corporation on our team."

The Alliance for Converging Technologies is a pioneer in the digital economy. A global leader in research and consulting services, the Alliance is an advisor to many Fortune 100 companies about business strategies for capitalizing on the Internet. The Alliance established IEC to translate this expertise into innovative financial products and advisory services for the investment community. With a family of 31 funds, Altamira is a market leader in no-load mutual funds and in other investment products and services. The company is headquartered in Toronto with offices in Vancouver, Calgary, Edmonton, Montreal, St. John and Halifax.

0- 11/17/1998

For further information: Stephen Hewitt/Joshua Orzech, NATIONAL Public Relations, (416) 586-0180

News release courtesy Canada NewsWire.

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