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Canaccord Leads Talks to Create New Debt Market, Globe Says

By Frederic Tomesco

March 28 (Bloomberg) -- Canaccord Capital Inc. and other Canadian financial institutions are in talks to create a market that would let individual holders of asset-backed commercial paper recoup most of their investment, the Globe and Mail reported.

Canaccord's plan calls for institutional investors to set aside money that could be used to buy out smaller investors, the Globe said, citing people familiar with the discussions. The plan "is to give investors as much of their money back as soon as possible,'' the newspaper said, citing one unidentified person familiar with the plan.

Vancouver-based Canaccord was the biggest seller of non- bank asset-backed commercial paper to individual investors in Canada, the Globe said. About 1,400 people, or 80 percent of an estimated 1,800 holders of the securities, bought the notes from Canaccord, the newspaper said.

A group of Canadian institutional investors spent more than six months on a plan to convert asset-backed commercial paper into notes that mature within nine years. Noteholders will vote on the plan on April 25, with majority support needed for the proposal to succeed. Some investors have said they'll reject the plan because they can't wait years to get their money back on investments that were supposed to mature in 30 to 90 days.

To contact the reporter for this story: Frederic Tomesco in Montreal at tomesco@bloomberg.net

Last Updated: March 28, 2008 07:56 EDT

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