DJ Lyxor International Asset Management: Change of regulatory structure
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Lyxor International Asset Management (MSEU)
Lyxor International Asset Management: Change of regulatory structure
14-Sep-2018 / 14:25 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
Paris, 14 August 2018
NOTICE TO THE UNIT-HOLDERS OF the FCP fund
Lyxor Euro Stoxx 50 (DR) UCITS ETF
UNIT CLASS ISIN code
Lyxor Euro Stoxx 50 (DR) UCITS ETF - Daily Hedged FR0012399806
to USD - Acc
Dear unit-holder,
According to our records you hold units in the FCP fund Lyxor Euro Stoxx 50
(DR) UCITS ETF (hereinafter the "Absorbed Fund").
In order to provide investors with an investment vehicle that offers a
corporate governance structure, it was decided, at the request of Lyxor
International Asset Management (hereinafter "LIAM"), to merge the Absorbed
Fund into Lyxor Euro Stoxx 50 (DR) UCITS ETF (hereinafter the "Absorbing
Sub-fund"), which is a sub-fund of MULTI UNITS FRANCE (MUF), a French SICAV
fund.
As a result of this merger through absorption the Absorbing Sub-fund will
receive all of the Absorbed Fund's assets.
When this merger is completed, the Absorbed Fund's unit-holders will be
shareholders of the MULTI UNITS FRANCE fund.
1) The merger
This merger through absorption will not modify the investment strategy nor
the ISIN code for unit-holders in the Absorbed Fund.
The index replication and investment methods of the Absorbed Fund and the
Absorbing Sub-fund are identical, since the investment strategy for both is
to achieve the highest possible correlation with the performance of the
Benchmark Index using a direct replication method, which means that the
Absorbing Sub-fund will invest in a basket of balance sheet assets that is
composed of the securities that underlie the Benchmark Index.
The tracking error objective between the Absorbed Fund's performance and
that of its Benchmark Index under normal market conditions is 0.25%. The
tracking error objective between the Absorbing Sub-fund's performance and
that of its Benchmark Index under normal market conditions is 0.50%.
The other characteristics of the Absorbed Fund and of the Absorbing Sub-fund
are also identical, i.e. the investment policy and strategy, the typical
investor profile, the risk profile, the frequency of net asset value
calculation, trading days, the accounting currency, the requirements for
submitting subscription and redemption orders, share/unit category
characteristics, fees and expenses and the method used to determine the
overall risk exposure.
This merger by absorption was approved by the French financial markets
authority, l'Autorité des marchés financiers (AMF), on 1 June 2018.
The Absorbed Fund is an undertaking for the collective investment in
transferable securities (hereinafter "UCITS") that is classified as a
"Eurozone equities" fund. It was approved by the AMF on 23 January 2001 and
was established on 19 February 2001. LIAM is the Absorbed Fund's management
company and Société Générale is its depositary.
The Absorbing Sub-fund is a UCITS that was approved by the AMF on 1 June
2018 and will be launched on the Merger Date, which is defined below. LIAM
is the Absorbing Sub-fund's delegated asset manager and Société Générale is
its depositary.
Unless you decide otherwise, your units of the Absorbed Fund will be
automatically merged into the Absorbing Sub-fund on 20 September 2018 (the
"Merger Date").
During a period of 30 calendar days after the date this notice is posted,
primary market investors (i.e. which subscribe for and redeem units directly
from LIAM) may redeem their units from LIAM and/or from its depositary
without having to pay a redemption fee, provided that they comply with the
minimum redemption requirements specified in the Absorbed Fund's prospectus.
As always, LIAM will of course charge no subscription or redemption fee on
the purchase or sale of the Absorbed Fund's units on any exchange where they
are listed (i.e. in the secondary market).
To complete this merger through absorption as smoothly as possible, the
subscription and redemption of the Absorbed Fund's units on the primary
market will be suspended on 17 September 2018 after 5.00 pm (Paris time).
However, it should be noted that the Absorbed Fund's units may be purchased
and sold on the secondary market up until the Merger Date.
Lastly, for operational reasons, subscriptions and redemptions of the
Absorbing Sub-fund's shares on the primary market will not be processed on
the first business day after the Merger.
2) Consequences
This merger through absorption will not modify the investment strategy nor
the risk profile for unit-holders in the Absorbed Fund.
The risk-return profile is modified: NO
The risk-return profile is increased: NO
Expenses are increased: NO
As indicated in section 1 above ("The merger"), the only impact the merger
will have on unit/shareholders will be the fund's conversion from a
contract-based entity (the FCP fund) to a corporate entity (the SICAV fund).
It should be noted that the Absorbing Sub-fund will be eligible for
inclusion in PEA equity savings plans.
You will find the calendar for this merger in Schedule 1, information on the
exchange of units in Schedule 2, and a comparison of the characteristics of
the Absorbed Fund with those of the Absorbing Sub-fund in Schedule 3.
3) Key points for investors
LIAM informs investors that all Absorbing Sub-fund share classes are or will
be listed on the same exchange or exchanges as their corresponding Absorbed
Fund unit class.
Unlike an FCP common fund, whose unit-holders enjoy none of the rights of
share-holders, a SICAV open-ended investment company can issue shares in
response to investor demand. Upon completion of this merger you will
therefore become a shareholder of the MULTI UNITS FRANCE SICAV and will be
entitled to express your opinion at annual and extraordinary shareholder
meetings.
Investors should also note that the merger by absorption may affect their
personal tax situation since the Absorbed Fund is an FCP common fund and was
therefore formed under contract law (whereas the Absorbing Sub-fund is a
SICAV open-ended investment company), and as a result of the merger itself.
Investors are therefore invited to consult with their usual advisor as to
the possible consequences the merger by absorption may have on their
personal situation.
LIAM recommends that investors carefully read the "Risk Profile" section of
the Absorbing Sub-fund's prospectus and the "Risk and Return Profile"
section of its Key Information for Investors Document (KIID). The KIID and
the prospectus are both available in French and free of charge at
www.lyxoretf.com [1] or from client-services-etf@lyxor.com.
The management company will provide unit-holders, upon request, with (i)
additional information on the merger, (ii) a copy of the statutory auditor's
report, (iii) a copy of the depositary's report and (iv) a copy of the
merger agreement.
If you need any more information you should contact your advisor.
We thank you for your trust and loyalty.
Yours faithfully
The Chairman
Schedule 1: Merger calendar
Absorbed Subscriptions & Effective Based on Shares to
Fund redemptions are merger date the NAV be
suspended of received
from the
Absorbing
Sub-fund
Lyxor Euro 17 September 2018 20 September 20 MULTI
Stoxx 50 after 5.00 pm 2018 September UNITS
(DR) UCITS (Paris time) 2018 FRANCE
ETF -Lyxor
Euro
Stoxx 50
(DR)
UCITS ETF
Schedule 2: Information on the merger
As shown on the merger calendar (see Schedule 1 above), the Absorbed Fund in
which you hold units will be merged into the Absorbing Sub-fund on 20
September 2018 (the "Merger Date"). This merger through absorption was
approved by the AMF on 1 June 2018.
All of the Absorbed Fund's assets and liabilities will be transferred to the
Absorbing Sub-fund. The Absorbed Fund will automatically be dissolved on the
merger completion date.
The Absorbing Sub-fund will be created by contributing all of the Absorbed
Fund's assets at the merger completion date.
In exchange for the assets contributed, the Absorbing Sub-fund will issue
shares that will be attributed to the investors in the Absorbed Fund.
For each unit class held in the Absorbed Fund there will be issued a
corresponding share class in the Absorbing Sub-fund of equivalent value as
at 20 September 2018.
The Absorbing Sub-fund share class will be issued on 20 September 2018 at an
initial net asset value that is equivalent to the net asset value of the
Absorbed Fund's unit class at that date.
There will therefore be no odd lots nor cash adjustments since the merger
will involve the exchange of one Absorbed Fund unit for one Absorbing
Sub-fund share of equal value.
(MORE TO FOLLOW) Dow Jones Newswires
September 14, 2018 09:27 ET (13:27 GMT)
The statutory auditors will furthermore certify the accounts of the Absorbed
Fund and the Absorbing Sub-fund respectively, on the date specified for
valuation.
Société Générale, the depositary, will handle the exchange of the Absorbed
Fund's units for the Absorbing Sub-fund's shares.
The depositary will also inform the Euroclear France members that hold the
accounts of the former Absorbed Fund investors of the number of Absorbing
Sub-fund shares to which the latter are entitled.
Lastly, LIAM will bear all merger expenses.
Tax consequences of the merger by absorption (for investors who are French
tax residents).
The merger transaction described in this letter is subject to the laws in
effect on the Merger Date.
Accordingly, the tax regime that applies to the exchange of units/shares
depends on the unit-holder's tax situation as shown below. The unit-holder
may also be subject to disclosure requirements in some cases.
Resident natural person unit-holders: taxation is deferred (pursuant to
Article 150-0 B of the French general tax code) provided that any cash
adjustment paid to the client is less than 10% of the nominal value of the
securities received.
If the cash adjustment exceeds 10% of the nominal value of the securities
received, the capital gain up to the amount of this cash adjustment is
subject to taxation in the year of the merger. However, the net income from
the exchange of securities (excluding the capital gain up to the amount of
the cash adjustment) is not taxable in the year of the merger but is taxable
in the year that the absorbing fund's securities are sold. The securities
exchanged are accordingly not included in the calculation of total portfolio
securities sold, for the purpose of determining whether or not the limit for
declaring security sales has been breached.
Therefore, during the future sale or redemption of the absorbing fund's
units, the capital gain is determined on the basis of the purchase price of
the absorbed fund's units, minus any cash adjustment received or plus any
cash adjustment paid.
Sole proprietor unit-holders whose income tax is based on their actual
industrial, commercial or agricultural income: taxation is deferred. These
taxpayers are treated either as resident natural person taxpayers (i.e. the
securities are included in their personal assets) or are taxed on the basis
of their professional capital gains (the securities are included in their
professional assets).
In both cases, the net income from the exchange of securities is not taxed
for the year of the merger, but is taxed the year in which the fund
securities received in exchange are sold. Regarding the professional capital
gain (PCG): only the part of the PCG that corresponds to a cash adjustment
that may have been received is immediately taxable. Upon the future sale or
redemption of the fund securities received in exchange, the PCG will be
calculated as of the date these securities were received and at their
initial purchase price.
Legal-entity unit-holders subject to corporate income tax: taxation is
deferred (pursuant to Article 38-5 bis of the French general tax code). Only
the part of the capital gain that corresponds to a cash adjustment received
is immediately taxable.
The net income from the exchange of securities (excluding any cash
adjustment) is not included in the taxable income of the year of the merger
but is included in that of the year in which the fund securities received in
exchange are sold.
However, when an investor is subject to Article 209 OA of the French general
tax code, the taxation of the valuation adjustments of the fund securities
reduces the actual applicability of the tax deferral since the valuation
adjustments have already been taxed and include some or all of the capital
gain on the exchange of securities for the merger.
Non-profit institution unit-holders that meet the requirements of Article
206-5 of the French general tax code and non-resident unit-holders: these
investors are not subject to taxation in France in relation to this merger
transaction (pursuant to Article 244 bis C of the French general tax code).
Sale of odd-lot units
A sale of units in the Absorbed Fund that are not exchanged (i.e. an "odd
lot") is considered to be a sale of units from which any net income is
immediately taxable under the rules that generally apply to the taxation of
capital gains. More specifically, the taxation of any net income on the
units exchanged within the limits of the share-exchange ratio is entitled to
deferral, whereas any surplus units are considered to be sold and the net
income from their sale is immediately taxable.
Schedule 3: Comparison of Absorbed Fund and Absorbing Sub-fund
characteristics
Absorbed Fund Absorbing Sub-fund
Name Lyxor Euro Stoxx 50 (DR) MULTI UNITS FRANCE -
UCITS ETF Lyxor Euro Stoxx 50
(DR) UCITS ETF
Applicable law French law French law
Supervisory AMF AMF
authority
Legal form A common investment fund A sub-fund of a SICAV
(FCP) investment company
Depositary Société Générale Société Générale
Registrar and Société Générale Société Générale
transfer agent
Fund Société Générale Société Générale
administrator
Statutory Pricewaterhousecoopers Pricewaterhousecoopers
auditor Audit Audit
Absorbed Fund unit class Daily Hedged to USD - FR0012399806
Acc
Absorbing Sub-fund share
class
The issuer - Lyxor International Management - confirms that the
application(s) do(es) not fall under Articles 5.1 or 5.2 of Council
Regulation (EU) No 833/2014 of 31 July 2014 concerning restrictive measures
in view of Russia's actions destabilising the situation in Ukraine (as
amended by Council Regulation (EU) No 960/2014 of 8 September 2014,
published in the Official Journal of the EU on 12 September 2014).
ISIN: FR0012399806
Category Code: MSCM
TIDM: MSEU
OAM Categories: 3.1. Additional regulated information required to be
disclosed under the laws of a Member State
Sequence No.: 6018
EQS News ID: 723935
End of Announcement EQS News Service
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(END) Dow Jones Newswires
September 14, 2018 09:27 ET (13:27 GMT)
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