THIS ANNOUNCEMENT SHOULD NOT BE DISTRIBUTED, FORWARDED TO OR TRANSMITTED, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO MAY CONSTITUTE A VIOLATION OF THE SECURITIES LAWS OR REGULATIONS OF ANY SUCH JURISDICTION
BLACKROCK FRONTIERS INVESTMENT TRUST PLC
LEI: 5493003K5E043LHLO706
PUBLICATION OF A CIRCULAR TO CONVENE A GENERAL MEETING
7 March 2018
BlackRock Frontiers Investment Trust plc (the "Company") has today published a circular (the "Circular") convening a general meeting (the "General Meeting") at which holders of the Company's ordinary shares ("Shareholders") will be asked to approve changes to the Company's investment objective and policy.
Background
Under the Company's current investment policy the Company may invest in the securities of companies domiciled or listed in, or exercising the predominant part of their economic activity in, 'Frontier Markets'. A 'Frontier Market' is defined as: (i) any country that was not a constituent of the MSCI Emerging Markets Index or the MSCI World Index as at 1 December 2015 (save for those countries specified in (ii)); or (ii) any of Colombia, Egypt, Peru or the Philippines, each of which was a member of the MSCI Emerging Markets Index as at 1 December 2015, but which share similar characteristics to those of less developed markets (such as low per capita GDP, high growth potential and less developed capital markets). Investment in the securities of companies domiciled or listed in, or exercising the predominant part of their economic activity in, those countries specified in (ii) above is limited to a maximum of 20 per cent. of the Gross Asset Value of the portfolio on an ongoing basis.
Since the launch of the Company in 2010, the UAE and Qatar and more recently Pakistan have been promoted from the MSCI Frontier Markets Index to the MSCI Emerging Markets Index, whilst only Morocco has been demoted. The Board believes, as advised by the Investment Manager, that the promotion of countries to the MSCI Emerging Markets Index will continue, with Argentina currently under review by MSCI. Irrespective of the index classification applied by MSCI, many countries in the MSCI Emerging Markets Index typically exhibit the characteristics of markets which are fast growing and frontier in nature, show low correlations to more developed markets and are inefficient, such that they remain relevant for the Company's mandate. Consequently, the Board, as advised by the Investment Manager, does not believe that the current limit on exposure to countries in the MSCI Emerging Markets Index is appropriate.
Proposal to amend the Company's investment objective and policy
In light of the above, the Board, as advised by the Investment Manager, believes that it is advisable to broaden the scope of the Company's investible universe.
Currently, the eight largest countries in the MSCI Emerging Markets Index have a combined market capitalisation equal to approximately 85 per cent. of the index: being Brazil, China, India, Korea, Mexico, Russia, South Africa and Taiwan (the "Selected Countries"). The other 16 countries represent approximately 15 per cent. of the MSCI Emerging Markets Index. These 16 countries share many characteristics with the markets which are defined in the Company's current investment policy as 'Frontier Markets', and are often overlooked by investors in emerging markets. Therefore, the Board is seeking Shareholder approval to amend the Company's investment objective and policy such that its investible universe will be those countries which are neither part of the MSCI World Index of developed countries nor one of the Selected Countries. Given the proposed expansion of the investible universe, it is also proposed that the limit in the Company's existing investment policy that applies to specified countries in the MSCI Emerging Markets Index be removed.
The Board is also using the opportunity to make additional non-substantive changes to the investment objective and policy, primarily in relation to the presentation of gearing limits. This follows a full review of the investment objective and policy and the changes are intended to add clarity around the investment process and to ensure consistency within the investment policy. Whilst the Board acknowledges that this has resulted in redrafting a substantial amount of the text of the investment policy, save as set out in the paragraph above there have not been any changes to the underlying limits applying to the investment policy, including in relation to the use of gearing and derivatives, and the only material change is the change to the investible universe.
In compliance with the Listing Rules, the proposed changes to the Company's investment objective and policy have been considered and approved by the FCA. The full text of the Company's current, and the proposed amended, investment objective and policy are set out in the Circular.
General Meeting
At the General Meeting, which will be held at 12 Throgmorton Avenue, London EC2N 2DL at 12.00 p.m. on 27 March 2018, a resolution (the "Resolution") to amend the Company's investment objective and policy, which will be proposed as an ordinary resolution, is to be considered. If the Resolution is approved, the changes will take effect from 1 April 2018, being the day immediately following the Company's half-year end.
Expected timetable
| Latest time and date for receipt of Forms of Proxy or transmission of CREST Proxy Instructions for the General Meeting | 12.00 p.m. on 23 March 2018 |
| General Meeting | 12.00 p.m. on 27 March 2018 |
| All references to timings in this document are to London time unless otherwise stated. | |
Terms used and not defined in this announcement shall have the meanings given to them in the Circular.
A copy of the Circular has been submitted to the National Storage Mechanism and will shortly be available for inspection at http://www.morningstar.co.uk/uk/NSM.
The Circular will also shortly be available on the Company's website at: www.blackrock.com/uk/brfi/gmcircular.
For further information, please contact:
Kevin Mayger
for and on behalf of BlackRock Investment Management (UK) Limited
Company Secretary
Tel: 020 7743 1098
Neil Morgan
Winterflood Securities Limited
Corporate Broker
Tel: 020 3100 0000
IMPORTANT INFORMATION
The content of this announcement has been prepared by, and is the sole responsibility of, BlackRock Frontiers Investment Trust plc. The information contained in this announcement is given at the date of its publication (unless otherwise marked) and is subject to updating, revision and amendment from time to time. Neither the content of the Company's website nor any website accessible by hyperlinks to the Company's website is incorporated in, or forms part of, this announcement. The distribution of this announcement into jurisdictions other than the United Kingdom may be restricted by law. Any failure to comply with these restrictions may constitute a violation of the securities laws or regulations of any such jurisdiction. In particular, this announcement should not be distributed, forwarded to or transmitted, directly or indirectly, in whole or in part, in, into or from the United States, Australia, Canada, Japan or the Republic of South Africa or any other jurisdiction where to do so may constitute a violation of the securities laws or regulations of any such jurisdiction. Winterflood Securities Limited, which is authorised and regulated by the Financial Conduct Authority, is acting only for the Company in connection with the matters described in this announcement and is not acting for or advising any other person, or treating any other person as its client, in relation thereto and will not be responsible for providing the regulatory protection afforded to clients of Winterflood Securities Limited or advice to any other person in relation to the matters contained herein.
None of BlackRock Investment Management (UK) Limited, BlackRock Fund Managers Limited or Winterflood Securities Limited, or any of their respective affiliates, accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to this announcement, including the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or for any loss howsoever arising from any use of the announcement or its contents. BlackRock Investment Management (UK) Limited, BlackRock Fund Managers Limited, Winterflood Securities Limited, and their respective affiliates, accordingly disclaim all and any liability whether arising in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.
No offer or invitation to subscribe for or acquire shares in the Company is being made by or in connection with this announcement.
This announcement does not constitute and may not be construed as, an invitation to purchase, investments of any description, or a recommendation regarding the issue or the provision of investment advice by any party. No information set out in this announcement or referred to in other written or oral form is intended to form the basis of any contract of sale, investment decision or any decision to purchase shares in the Company.
This announcement is for information purposes only and does not constitute a financial promotion, marketing communication or an offer or invitation to anyone to invest and/or acquire shares in the Company. This has also not been prepared in connection with any such offer. Accordingly, this announcement does not constitute an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not lawful or in which the person making such offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make such offer or solicitation. It is your responsibility to be aware of the applicable laws and regulations of your country of residence.
Winterflood Securities Limited, BlackRock Investment Management (UK) Limited and BlackRock Fund Managers Limited are authorised and regulated in the United Kingdom by the Financial Conduct Authority.
