ALLIANCE GLOBAL ENVIRONMENT FUND
ANNUAL REPORT
OCTOBER 31, 1996
AN INVESTMENT WITH A CLEAR FUTURE
LETTER TO SHAREHOLDERS
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
November 30, 1996
Dear Shareholder:
We are pleased to report the performance of Alliance Global Environment Fund
for the fiscal year ended October 31, 1996. The table below also gives
performance data for the FASC (First Analysis Securities Corporation)
Environmental Index, a broad-based index of companies in the environmental
industry, and the S&P 500 Stock Index, a measure of the broad U.S. stock
market. For the 6- and 12-month periods ended October 31, the Fund outperformed
the FASC benchmark. For the 12-month period, performance also surpassed that of
the S&P 500.
TOTAL RETURNS FOR THE
PERIODS ENDED OCTOBER 31, 1996
6 MONTHS 12 MONTHS
---------- -----------
Alliance Global Environment Fund 8.28% 33.48%
FASC Environmental Index 0.00 15.30
S&P 500 Stock Index 9.08 24.02
BOTH THE FASC AND S&P INDICES ARE UNMANAGED.
The Fund ended its fiscal year with a net asset value of $16.48 per share, up
from $15.22 per share on April 30, 1996.
INVESTMENT ACTIVITY
The Fund continued its strong performance in the second half of the fiscal
year, driven by a rigorous focus on the growing segments of the environmental
services industry, particularly those areas driven by economics and existing,
enforced regulations. This focus has led to three primary themes within the
Fund: domestic solid waste collection and disposal services, water treatment
equipment and services, and basic materials recycling.
Solid waste industry fundamentals remain attractive, with high single-digit
internal growth (driven by both price and volume) and accelerating
consolidation of the industry. The Fund has approximately 35% of total assets
invested in the solid waste segment, with a particular focus on small- and
mid-sized companies which we believe stand to benefit most from current
industry trends. Significant holdings include American Disposal Services,
Republic Industries, United Waste Systems, USA Waste Services and Allied Waste
Industries.
We believe certain segments of the water treatment equipment and services
industry are exhibiting particularly strong internal growth, and have
positioned the portfolio to take advantage of this growth. Common
characteristics of companies within these sub-sectors include margin expansion,
consolidation opportunities, and free cash flow generation. The Fund currently
has approximately 22% of its holdings in water treatment, including positions
in U.S. Filter, Culligan Water Technologies, Cytec Industries, and Generale des
Eaux (based in France).
Approximately 9% of the Fund's assets are invested in firms involved in basic
materials recycling, which is an expanded version of an earlier theme, steel
recycling. Emphasis is placed on economic-based recycling rather than recycling
driven by regulation. Investments range from UCAR International (a graphite
electrode manufacturer), to Philip Environmental (a Canadian industrial
services company), to Tetra Technologies (a specialty inorganic chemical
company).
Other significant holdings include Landec, a specialty polymer manufacturer,
Newpark Resources, an oil field waste services company, and International
Technology, a hazardous waste consulting firm.
The outlook for fiscal 1997 is favorable as many of the investment themes that
helped the Fund's performance in 1996 remain in place. We believe that the Fund
continues to be well positioned to take advantage of growth opportunities
within the environmental services industry.
1
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
SHARE REPURCHASE PROGRAM
On March 14, 1996, the Fund's Board of Directors authorized a share repurchase
program which entails the purchase of up to 20% of the Fund's shares in the
open market over a 12-month period. Purchases at current prices are accretive
to net asset value per share due to the significant discount at which the share
price trades to net asset value. As of November 30, 1996, the Fund had
purchased 871,800 shares at an average price of $12.65 per share. The buyback
has added approximately $0.51 per share, or 3.5%, to NAV since its initiation.
The Fund expects to continue the repurchase program under the terms previously
announced.
As always, we thank you for your continued interest and investment in Alliance
Global Environment Fund.
Sincerely,
John D. Carifa
Chairman and President
Jeremy R. Kramer
Vice President
2
TEN LARGEST HOLDINGS
OCTOBER 31, 1996
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
PERCENT OF
COMPANY U.S. $ VALUE NET ASSETS
- -------------------------------------------------------------------------------
AMERICAN DISPOSAL SERVICES, INC.--The company
provides solid waste collection, transfer and
disposal services for residential, commercial
and industrial customers. $10,800,000 10.8%
REPUBLIC INDUSTRIES, INC.--The company
provides waste collection and disposal services,
as well as electronic security services. 9,337,500 9.3
U.S. FILTER CORP.--The company provides industrial
and commercial water and wastewater treatment
systems and services. 5,865,000 5.8
LANDEC CORP.--The company designs, develops,
manufactures, and sells temperature-activated
polymer products for a variety of industrial,
medical, and agricultural applications. 5,325,000 5.3
UNITED WASTE SYSTEMS, INC.--The company provides
residential, commercial, and industrial
customers with integrated, nonhazardous, solid
waste management services. 4,812,500 4.8
USA WASTE SERVICES, INC.--The company provides
solid waste management services to municipal,
commercial, industrial and residential customers
in the United States. 4,800,000 4.8
ALLIED WASTE INDUSTRIES, INC.--The company provides
non-hazardous solid waste collection, transfer,
recycling and disposal services. 4,667,188 4.7
EMCOR GROUP, INC.--The company designs, distributes,
integrates, installs and maintains mechanical
and electrical systems. 4,241,250 4.2
CULLIGAN WATER TECHNOLOGIES, INC.--The company
manufactures and distributes products that
purify and treat water. 4,125,000 4.1
NEWPARK RESOURCES, INC.--The company provides
environmental management and oilfield
construction services to the oil and gas
industry. 4,125,000 4.1
$58,098,438 57.9%
3
INDUSTRY DIVERSIFICATION
OCTOBER 31, 1996
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
PERCENTAGE OF
U.S. $ VALUE NET ASSETS
- -------------------------------------------------------------------------------
Capital Goods $ 1,945,860 1.9%
Chemicals 5,325,000 5.3
Consumer Manufacturing 4,241,250 4.2
Consumer Services 408,000 0.4
Energy 5,798,438 5.8
Healthcare 616,875 0.6
Paper/Forrestry 883,750 0.9
Pollution Control 7,973,265 8.0
Recycling 8,405,111 8.4
Solid Waste Management 35,725,313 35.6
Transportation 2,351,833 2.4
Water treatment 21,253,071 21.2
Total Investments (excluding commercial paper) 94,927,766 94.7
Cash and other assets, net of liabilities 5,343,038 5.3
Net Assets $100,270,804 100.0%
4
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1996
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
COMPANY SHARES U.S. $ VALUE
- -------------------------------------------------------------------------
COMMON STOCKS & OTHER INVESTMENTS-94.6%
AUSTRALIA-2.3%
Brambles Industries, Ltd. 142,000 $ 2,351,833
CANADA-6.7%
Laidlaw, Inc. Cl. B. (a) 255,000 2,996,250
Laidlaw, Inc. Cl. B. 25,000 293,635
Philip Environmental, Inc. (b) 329,000 3,422,611
------------
6,712,496
FRANCE-2.4%
Generale des Eaux 20,000 2,390,571
JAPAN-1.9%
Ebara Corp. 135,000 1,945,860
NETHERLANDS-0.6%
Thermo Eurotech (b) (c) 165,000 583,380
UNITED STATES-80.7%
Allied Waste Industries, Inc. (b) 515,000 4,667,188
American Disposal Services, Inc. (b) 675,000 10,800,000
Culligan Water Technologies, Inc. (b) 110,000 4,125,000
Cuno, Inc. (b) 60,000 960,000
Cytec Industries, Inc. (b) 109,000 3,896,750
EMCOR Group, Inc. (b) 290,000 4,241,250
GNI Group, Inc. (b) 115,000 704,375
International Alliance Services (b) 40,800 408,000
International Technology Corp. (b) 1,600,000 3,800,000
Ionics, Inc. (b) 12,000 552,000
Landec Corp. (b) 600,000 5,325,000
Newpark Resources, Inc. (b) 110,000 4,125,000
SHARES OR
PRINCIPAL
AMOUNT
COMPANY (000) U.S. $ VALUE
- -------------------------------------------------------------------------
Osmonics, Inc. (b) 31,000 $ 658,750
Polymer Group (b) 220,000 2,805,000
Republic Industries, Inc. (b) 300,000 9,337,500
Superior Services, Inc. (b) 35,000 603,750
Tetra Technologies, Inc. (b) 70,000 1,461,250
Thermatrix, Inc. (b) 30,000 300,000
Thermo Fibergen, Inc. (b) 70,000 883,750
Thermo Power Corp. (b) 175,000 1,673,438
Trex Medical Corp. (b) 35,000 616,875
UCAR International, Inc. 90,000 3,521,250
United Waste Systems, Inc. (b) 140,000 4,812,500
U.S. Filter Corp. (b) 170,000 5,865,000
USA Waste Services, Inc. (b) 150,000 4,800,000
------------
80,943,626
Total Common Stocks
(cost $85,791,431) 94,927,766
COMMERCIAL PAPER-4.8%
UNITED STATES-4.8%
American Express Co.
5.28%, 11/07/96 (d) 3,700 3,696,744
Prudential Insurance Co. of America
5.25%, 11/05/96 (d) 1,100 1,099,358
Total Commercial Paper
(amortized cost $4,796,102) 4,796,102
TOTAL INVESTMENTS-99.4%
(cost $90,587,533) 99,723,868
Other assets less liabilities-0.6% 546,936
NET ASSETS-100% $100,270,804
(a) Foreign security denominated in U.S. dollars.
(b) Non-income producing security.
(c) Restricted security, valued at fair value. (See Notes A and E.)
(d) Market yield effective at purchase date.
See notes to financials.
5
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1996
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
ASSETS
Investments in securities, at value (cost $90,587,533) $ 99,723,868
Cash 27,836
Receivable for investment securities sold 2,510,721
Dividends receivable 66,200
Prepaid expenses 2,880
Total assets 102,331,505
LIABILITIES
Payable for investment securities purchased 1,567,538
Payable for capital stock redeemed 210,821
Management fee payable 94,278
Accrued expenses 188,064
Total liabilities 2,060,701
NET ASSETS $100,270,804
COMPOSITION OF NET ASSETS
Capital stock, at par $ 60,850
Additional paid-in capital 84,935,027
Accumulated net realized gain on investments and foreign
currency transactions 6,138,329
Net unrealized appreciation of investments and foreign
currency denominated assets and liabilities 9,136,598
$100,270,804
NET ASSET VALUE PER SHARE (based on 6,084,969 shares outstanding) $16.48
See notes to financial statements.
6
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1996
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
INVESTMENT INCOME
Dividends(net of foreign taxes withheld of $26,171) $ 568,489
Interest 159,711 $ 728,200
EXPENSES
Management fee 1,073,769
Custodian 175,519
Audit and legal 98,499
Directors' fees 66,715
Transfer agency 37,577
Registration 32,504
Printing 23,481
Miscellaneous 53,874
Total expenses 1,561,938
Net investment loss (833,738)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain on investment transactions 20,448,020
Net realized loss on foreign currency transactions (565,933)
Net change in unrealized appreciation of:
Investments 6,304,365
Foreign currency denominated assets and liabilities (1,382)
Net gain on investments and foreign currency transactions 26,185,070
NET INCREASE IN NET ASSETS FROM OPERATIONS $25,351,332
See notes to financial statements.
7
STATEMENT OF CHANGES IN NET ASSETS
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1996 1995
------------- ------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income (loss) $ (833,738) $ 170,945
Net realized gain on investments and foreign
currency transactions 19,882,087 348,367
Net change in unrealized appreciation of
investments and foreign currency denominated
assets and liabilities 6,302,983 3,795,897
Net increase in net assets from operations 25,351,332 4,315,209
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income (138,142) -0-
CAPITAL STOCK TRANSACTIONS
Repurchase of fund shares (10,359,153) -0-
Total increase 14,854,037 4,315,209
NET ASSETS
Beginning of year 85,416,767 81,101,558
End of year (including undistributed net
investment income of $116,215 at
October 31, 1995) $100,270,804 $85,416,767
See notes to financial statements.
8
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1996
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Global Environment Fund, Inc. (the "Fund"), is registered under the
Investment Company Act of 1940 as a non-diversified, closed-end management
investment company. The following is a summary of significant accounting
policies followed by the Fund.
1. SECURITY VALUATION
All securities listed on an exchange for which market quotations are readily
available are valued at the closing price on the exchange on the day of
valuation or, if no such closing price is available, at the mean of the last
bid and ask price quoted on such day. Securities for which market quotations
are not readily available and restricted securities are valued in good faith at
fair value using methods determined by the Board of Directors. In determining
fair value, consideration is given to cost, operating and other financial data.
Short-term debt securities which mature in 60 days or less are valued at
amortized cost which approximates market value, unless this method does not
represent fair value.
2. CURRENCY TRANSLATION
Assets and liabilities denominated in foreign currencies are translated into
U.S. dollars at the mean of the quoted bid and asked price of the respective
currency against the U.S. dollar on the valuation date.
Purchases and sales of portfolio securities are translated at the rates of
exchange prevailing when such securities were acquired or sold. Income and
expenses are translated at rates of exchange prevailing when earned or accrued.
Net realized loss on foreign currency transactions represents foreign exchange
gains and losses from the holding of foreign currencies, currency gains or
losses realized between the trade and settlement dates on security
transactions, and the difference between the amounts of dividends, interest and
foreign taxes receivable on the Fund's books and the U.S. dollar equivalent
amounts actually received or paid. Net change in unrealized appreciation
(depreciation) of foreign currency denominated assets and liabilities
represents net currency gains and losses from valuing foreign currency
denominated assets and liabilities at period end exchange rates.
3. TAXES
It is the Fund's policy to meet the requirements of the U.S. Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if applicable, to
shareholders. Therefore, no provisions for Federal income or excise taxes are
required. Withholding taxes on foreign interest and dividends have been
provided for in accordance with the applicable tax requirements.
4. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the date securities are
purchased or sold. Investment gains and losses are determined on the identified
cost basis. The Fund accretes discounts as adjustments to interest income.
5. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date and are determined in accordance with income tax regulations.
6. RECLASSIFICATION OF COMPONENTS OF NET ASSETS
As of October 31, 1996, the Fund reclassified certain components of net assets.
The reclassification resulted in a net decrease in accumulated net investment
loss of $855,665, and a net decrease in accumulated net realized gain on
investments and foreign currency transactions of $855,665. This
reclassification was the result of permanent book to tax differences resulting
from foreign currency and short-term gains and had no effect on net assets.
NOTE B: MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under an Investment Management and Administration Agreement, the Fund pays
Alliance Capital Management L.P., (the "Investment Manager"), a fee calculated
weekly and paid monthly, at an annualized rate of 1.10% of the Fund's average
weekly net assets up to $100 million, .95 of 1% of the next $100 million of the
Fund's average weekly net assets, and .80 of 1% of the Fund's average weekly
net assets over $200 million. Brokerage commissions paid on securities
transactions for the year ended October 31, 1996, amounted to $875,673, none of
which was paid to affiliated brokers.
9
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
During the year ended October 31, 1996, the Fund entered into a Shareholder
Inquiry Agreement with Alliance Fund Services, Inc. ("AFS"), an affiliate of
the Investment Manager, whereby the Fund reimburses AFS for costs relating to
servicing phone inquiries for the Fund. The Fund reimbursed AFS $2,106 during
the year ended October 31, 1996 relating to shareholder servicing costs.
NOTE C: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term and U.S.
Government obligations) aggregated $257,129,565 and $273,569,819 respectively,
for the year ended October 31, 1996. There were no purchases or sales of U.S.
government or government agency obligations for the year ended October 31,
1996. At October 31, 1996, the cost of securities for federal income tax
purposes was $91,203,530. Accordingly, gross unrealized appreciation of
investments was $14,057,906 and gross unrealized depreciation of investments
was $5,537,568 resulting in net unrealized appreciation of $8,520,338,
(excluding foreign currency transactions).
During the year ended October 31, 1996 the Fund utilized its full prior year
capital loss carryforward of $12,640,912 to reduce realized gains.
NOTE D: CAPITAL STOCK
There are 100,000,000 shares of $.01 par value common stock authorized. Of the
6,084,969 shares outstanding at October 31, 1996, the Investment Manager owned
7,169 shares. On March 14, 1996, the Fund initiated a share repurchase program.
The program allows for repurchase over a twelve month period of up to 20% of
the 6,907,169 shares outstanding at March 14, 1996. To date, 822,200 shares
have been repurchased at a total cost of $10,359,153. This includes $41,110 in
commissions paid to PaineWebber Incorporated. The average discount of market
price to net asset value of shares repurchased over the period of March 15,
1996 to October 31, 1996 was 19.87%.
NOTE E: RESTRICTED SECURITY
DATE ACQUIRED COST
--------------- ---------
Thermo Eurotech 3/19/91-4/15/91 $ 529,926
The security shown above, formerly known as Beheersmaatchappij J. Amerika N.V.,
is restricted as to sale and has been valued at fair value in accordance with
the procedures in Note A.
The value of this security at October 31, 1996 was $583,380 representing 0.6%
of net assets.
10
FINANCIAL HIGHLIGHTS
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
-----------------------------------------------------------------
1996 1995 1994 1993 1992
------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $12.37 $11.74 $10.97 $10.78 $13.12
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (.13)(a) .03 -0- .01 .01
Net realized and unrealized gain (loss)
on investments
and foreign currency transactions 4.26 .60 .77 .18 (2.17)
Net increase (decrease) in net asset
value from operations 4.13 .63 .77 .19 (2.16)
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.02) -0- -0- -0- (.10)
Distributions from net realized gain on
investments and foreign currency
transactions -0- -0- -0- -0- (.08)
Total dividends and distributions (.02) -0- -0- -0- (.18)
Net asset value, end of year $16.48 $12.37 $11.74 $10.97 $10.78
Market value, end of year $13.25 $9.375 $9.50 $9.25 $9.50
TOTAL RETURN
Total investment return based on: (b)
Market value 41.60% (1.32)% 2.70% (2.63)% (15.22)%
Net asset value 33.48% 5.37% 7.02% 1.76% (16.59)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's omitted) $100,271 $85,416 $81,102 $75,805 $74,442
Ratio of expenses to average net assets 1.60% 1.57% 1.67% 1.62% 1.63%
Ratio of net investment income (loss)
to average net assets (.85)% .21% (.04)% .15% .10%
Portfolio turnover rate 268% 109% 42% 25% 41%
Average commission rate (c) $.0313 -- -- -- --
</TABLE>
(a) Based on average shares outstanding.
(b) Total investment return is calculated assuming a purchase of common stock
on the opening of the first day and a sale on the closing of the last day of
each year reported. Dividends and distributions, if any, are assumed for
purposes of this calculation, to be reinvested at prices obtained under the
Fund's Dividend Reinvestment and Cash Purchase Plan. Generally, total
investment return based on net asset value will be higher than total investment
return based on market value in years where there is an increase in the
discount or a decrease in the premium of the market value to the net asset
value from the beginning to the end of such years. Conversely, total investment
return based on net asset value will be lower than total investment return
based on market value in years where there is a decrease in the discount or an
increase in the premium of the market value to the net asset value from the
beginning to the end of such years.
(c) For fiscal years beginning on or after September 1, 1995, a Fund is
required to disclose its average commission rate per share for trades on which
commissions are charged.
11
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
We have audited the accompanying statement of assets and liabilities of
Alliance Global Environment Fund, Inc. (the "Fund"), including the portfolio of
investments, as of October 31, 1996, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and the financial highlights for the
periods indicated therein. These financial statements and financial highlights
are the responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and financial highlights based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1996, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Alliance Global Environment Fund, Inc. at October 31, 1996, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each
of the indicated periods, in conformity with generally accepted accounting
principles.
New York, New York
December 12, 1996
12
ADDITIONAL INFORMATION (UNAUDITED)
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
Shareholders whose shares are registered in their own names will automatically
be participants in the Dividend Reinvestment and Cash Purchase Plan (the
"Plan"), pursuant to which dividends and capital gain distributions to
shareholders will be paid in or reinvested in additional shares of the Fund
(the "Dividend Shares"). State Street Bank and Trust Company (the "Agent") will
act as agent for participants under the Plan. Shareholders whose shares are
held in the name of a broker or nominee should contact such broker or nominee
to determine whether or how they may participate in the Plan.
If the Board declares an income distribution or determines to make a capital
gain distribution payable either in shares or in cash, as holders of the Common
Stock may have elected, non-participants in the Plan will receive cash and
participants in the Plan will receive the equivalent in shares of Common Stock
of the Fund valued as follows:
(i) If the shares of Common Stock are trading at net asset value or at a
premium above net asset value at the time of valuation, the Fund will issue new
shares at the greater of net asset value or 95% of the then current market
price.
(ii) If the shares of Common Stock are trading at a discount from net asset
value at the time of valuation, the Agent will receive the dividend or
distribution in cash and apply it to the purchase of the Fund's shares of
Common Stock in the open market, on the New York Stock Exchange or elsewhere,
for the participants' accounts. Such purchases will be made on or shortly after
the payment date for such dividend or distribution and in no event more than 30
days after such date except where temporary curtailment or suspension of
purchase is necessary to comply with Federal securities laws. If, before the
Agent has completed its purchases, the market price exceeds the net asset value
of a share of Common Stock, the average purchase price per share paid by the
Agent may exceed the net asset value of the Fund's shares of Common Stock,
resulting in the acquisition of fewer shares than if the dividend or
distribution had been paid in shares issued by the Fund.
The Agent will maintain all shareholders' accounts in the Plan and furnish
written confirmation of all transactions in the account, including information
needed by shareholders for tax records. Shares in the account of each Plan
participant will be held by the Agent in non-certificate form in the name of
the participant, and each shareholder's proxy will include those shares
purchased or received pursuant to the Plan.
There will be no charges with respect to shares issued directly by the Fund to
satisfy the dividend reinvestment requirements. However, each participant will
pay a pro rata share of brokerage commissions incurred with respect to the
Agent's open market purchases of shares. In each case, the cost per share of
shares purchased for each shareholder's account will be the average cost,
including brokerage commissions, of any shares purchased in the open market
plus the cost of any shares issued by the Fund.
The automatic reinvestment of dividends and distributions will not relieve
participants of any income taxes that may be payable (or required to be
withheld) on dividends and distributions.
Experience under the Plan may indicate that changes are desirable. Accordingly,
the Fund reserves the right to amend or terminate the Plan as applied to any
voluntary cash payments made and any dividend or distribution paid subsequent
to written notice of the change sent to participants in the Plan at least 90
days before the record date for such dividend or distribution. The Plan may
also be amended or terminated by the Agent on at least 90 days' written notice
to participants in the Plan. All correspondence concerning the Plan should be
directed to the Agent at State Street Bank and Trust Company, P.O. Box 366,
Boston, Massachusetts 02101.
Since the filing of the most recent amendment to the Fund's registration
statement with the Securities and Exchange Commission, there have been (i) no
material changes in the Fund's investment objectives or policies, (ii) no
changes to the Fund's charter or by-laws that would delay or prevent a change
of control of the Fund, (iii) no material changes in the principal risk factors
associated with investment in the Fund, and no change in the person primarily
responsible for the day-to-day management of the Fund's portfolio who is to
Jeremy Kramer, a Vice President of the Fund.
13
ADDITIONAL INFORMATION (CONTINUED)
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
SUPPLEMENTAL PROXY INFORMATION
The Annual Meeting of Shareholders of the Alliance Global Environment Fund,
Inc. was held on Thursday, May 23, 1996. The description of each proposal and
number of shares are as follows:
SHARES SHARES VOTED
VOTED FOR WITHOUT AUTHORITY
--------- -----------------
1. To elect directors: John D. Carifa 4,994,868 63,805
Richard M. Lilly 4,994,868 63,805
Robert C. White 4,992,850 65,823
SHARES SHARES VOTED SHARES VOTED
VOTED FOR AGAINST ABSTAIN
--------- ------------ ------------
2. To ratify the selection of Ernst &
Young LLP as the Fund's independent
auditors for the Fund's fiscal year
ending October 31, 1996: 5,020,538 6,160 31,975
14
ALLIANCE GLOBAL ENVIRONMENT FUND, INC.
_______________________________________________________________________________
BOARD OF DIRECTORS
JOHN D. CARIFA, CHAIRMAN AND PRESIDENT
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
W.H. HENDERSON (1)
STIG HOST (1)
RICHARD M. LILLY (1)
ALAN STOGA (1)
ROBERT C. WHITE (1)
OFFICERS
THOMAS J. BARDONG, VICE PRESIDENT
NICHOLAS CROSSLAND, VICE PRESIDENT
JEREMY R. KRAMER, VICE PRESIDENT
DANIEL V. PANKER, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
VINCE NOTO, CONTROLLER
CUSTODIAN
BROWN BROTHERS HARRIMAN & CO.
40 Water Street
Boston, MA 02109-3661
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019
TRANSFER AGENT, DIVIDEND-
PAYING AGENT AND REGISTRAR
STATE STREET BANK AND TRUST COMPANY
225 Franklin Street
Boston, MA 02110-1520
(1) Member of the Audit Committee.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase at market prices from time to
time shares of its common stock in the open market.
This report, including the financial statements herein, is transmitted to the
shareholders of Alliance Global Environment Fund for their information. This is
not a prospectus, circular or representation intended for use in the purchase
of shares of the Fund or any securities mentioned in this report.
15
ALLIANCE GLOBAL ENVIRONMENT FUND
Summary of General Information
INVESTMENT OBJECTIVE AND POLICIES
The Fund's investment objective is a long-term capital appreciation through
investment in equity securities of companies expected to benefit from advances
or improvements in products, processes or services intended to foster the
protection of the environment.
SHAREHOLDER INFORMATION
Daily market prices for the Fund's shares are published in the New York Stock
Exchange Composite Transaction section of newspapers under the designation
"ALLGIE". The Fund's NYSE trading symbol is "AEF". Weekly comparative net asset
value (NAV) and market price information about the Fund is published each
Monday in THE WALL STREET JOURNAL, each Sunday in THE NEW YORK TIMES and each
Saturday in BARRON'S, and other newspapers in a table called "Closed-End
Funds". Additional information about the Fund is available by calling
1-800-221-5672.
DIVIDEND REINVESTMENT PLAN
All shareholders whose Shares are registered in their own names will have all
distributions reinvested automatically in additional Shares, unless a
shareholder elects to receive cash. Shareholders whose Shares are held in the
name of a broker or nominee will automatically have distributions reinvested by
the broker or nominee in additional Shares under the Plan, unless the automatic
reinvestment service is not provided by the particular broker or nominee, or
the Shareholder elects to receive distributions in cash. A brochure describing
the Plan is available from the Plan Agent, State Street Bank and Trust Company,
by calling 1-800-219-4218.
ALLIANCE GLOBAL ENVIRONMENT FUND
1345 Avenue of the Americas
New York, New York 10105
ALLIANCE CAPITAL
INVESTING WITHOUT THE MYSTERY
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER, ALLIANCE
CAPITAL MANAGEMENT L.P.
ENVAR
