GE Money Asset Management, an investment management company, and Citadele Asset Management, an investment management joint-stock company, hereby inform that, having regard to the decision of GE Money grupa to suspend its operations on the Latvian market and to transfer assets of GE Money grupa to companies of the Citadele Group, they have decided, for purposes of protection of investor interests, to propose a domestic merger of GE Money Eastern Europe Equity Fund, ISIN LV0000400216, an open investment fund established by investment management company GE Money Asset Management (‘the Merging UCITS’) with Citadele Russian Equity Fund, ISIN LV0000400190, an open investment fund established by investment management joint-stock company Citadele Asset Management (‘the Receiving UCITS’).
The Finance and Capital Market Commission has adopted the decision to authorise the merger of the Merging UCITS and the Receiving UCITS on the 11th of September 2013.
The merger of the UCITS shall have the following consequences:
- All assets and liabilities of the Merging UCITS will be transferred to the Receiving UCITS;
- The unit-holders of the Merging UCITS will become unit-holders of the Receiving UCITS, taking into consideration the exchange ratio applicable to the exchange of units of the Merging UCITS and units of the Receiving UCITS at the time of the merger;
- The unit-holders of the Receiving UCITS will retain the units of the Receiving UCITS owned by them at the time of the merger;
- The Merging UCITS will cease to exist.
I. Effect of the UCITS merger on investors, and investor rights
Whereas the two UCITS to be merged operate pursuant to the Law on Investment Management Companies and other legislative acts of the Republic of Latvia, and further considering that the policy, investment strategy and current investment structure of the Receiving UCITS corresponds to the investment policy and strategy established by the Merging UCITS, the merger will not materially affect unit-holders of the Merging UCITS and the Receiving UCITS. Both the Receiving and the Merging UCITS have similar costs, periodic reporting, and expected outcome. Similarly, no rebalancing of the investment portfolio of the Merging UCITS and the Receiving UCITS will be undertaken either before or after the merger of the UCITS.
Whereas the two UCITS to be merged are established and operate pursuant to legislative acts of the Republic of Latvia, there exist no circumstances at the time of the merger that would cause any changes to the taxes or duties applicable to the unit-holders until now.
Unit-holders of the Merging and the Receiving UCITS will be entitled, in connection with the proposed merger to:
— Request the management company of the Merging UCITS to repurchase their units of the Merging UCITS or, as the case may be, request the management company of the Receiving UCITS to repurchase their units of the Receiving UCITS, free of charge from the 16 th of September till the 16 th of October, 2013.
The units will be repurchased in accordance with the procedure established by the Merging or the Receiving UCITS, respectively;
— Obtain additional information from the management companies of the Merging or the Receiving UCITS about the proposed merger of the UCITS;
— Obtain a copy of the opinion of Citadele banka JSC, depositary of the Receiving UCITS, at the bank’s address at Republikas laukums 2A in Riga concerning:
a) the criteria adopted for the valuation of the assets and the liabilities of the Merging and the Receiving UCITS on the date for calculating the exchange ratio of units of the Merging and the Receiving UCITS;
b) cash payment per unit of the Merging UCITS;
c) the calculation method of the exchange ratio of units.
II. Material aspects of the merger of the UCITS
According to legislative acts of the Republic of Latvia, the decision by the Finance and Capital Market Commission to authorise the domestic merger of the UCITS shall become effective on the thirtieth calendar day from the date of notification of the decision to the management company of the Merging UCITS. Thus the merger of the Merging UCITS and the Receiving UCITS is planned to take place on the 28th of October 2013, and the Merging UCITS will cease to exist after this date.
The following activities will be carried out in order to ensure the merger of the UCITS:
a) An assessment shall be made of the assets of the Merging and the Receiving UCITS;
b) Identification of the unit-holders of the Merging UCITS will be carried out;
c) The management company of the Merging UCITS shall give instructions to its depositary to transfer the assets to the Receiving UCITS by transfer of all assets to the depositary of the Receiving UCITS;
d) The management company of the Merging UCITS shall do a calculation of the exchange ratio of units of the UCITS and send the figures to the management company of the Receiving UCITS and its depositary for approval and to the Latvian Central Depositary (LCD) for co-ordination;
e) The management company of the Merging UCITS shall draw up a list of unit-holders of units of the Receiving UCITS stating in it the number of units of the Merging UCITS owned by unit-holders and the number of units of the Receiving UCITS due to unit-holders as a result of the merger;
f) The management company of the Merging UCITS shall give instructions to its depositary to cancel all units of the Merging UCITS with the LCD;
g) The management company of the Receiving UCITS shall give instructions to its depositary to issue a new issue of units of the Receiving UCITS with the LCD according to an approved list pursuant to subparagraph (e) hereof.
In order to ensure a successful merger of the UCITS, repurchase of units of the Merging UCITS and the Receiving UCITS will be suspended and units of the Merging UCITS and the Receiving UCITS will be cancelled with the LCD from the 17 th of October till the 30 th of October 2013, as a result of which effecting any transactions in them will not be possible.
Unit-holders are free to use their units of the Receiving UCITS starting from the 31 th of October 2013.
Key investor information for unit-holders of the Receiving UCITS is available on the website of investment management joint-stock company Citadele Asset Management: www.citadeleam.lv , or at the head office of investment management joint-stock company Citadele Asset Management at Republikas laukums 2A in Riga during its business hours.
Sincerely,
Citadele Asset Management,
Investment management joint-stock company,
Management company of the Receiving UCITS