ASHGEQ Restructure Ballot anouncement
Ashburton Management Company RF Proprietary Limited
Ashburton Global Equity ETF
Share Code: ASHGEQ
ISIN: ZAE000249967
Ashburton Global Equity ETF, a portfolio in the Ashburton Collective Investment Scheme (“the
portfolio”) registered in terms of the Collective Investment Schemes Control Act, 45 of 2002 (“the
Act”) and managed by Ashburton Management Company RF Proprietary Limited (“the manager”).
BALLOT VOTING PROCEDURE IN RESPECT OF THE CHANGE OF THE FUND STRUCTURE OF THE ASHBURTON GLOBAL 1200
EQUITY ETF (“ASHGEQ”), TRACKING THE S&P GLOBAL 1200 INDEX, TO A FUND OF FUND STRUCTURE.
1. Background
The aim of the portfolio is to provide returns linked to the performance of the S&P Global 1200
Index. Currently this is achieved by investing directly in the component equities of the index. As
the S&P Global 1200 Index is a composite of 7 regional headline indices, the fund is invested in
both developed and emerging markets across the US, Europe, Japan, Canada, Australia, Asia
and Latin America. Rebalancing of the 7 regional headline indices will be as and when the index
provider (S&P Dow Jones Indices) changes the respective weightings of the regions that is
represented by these. There is no rebalancing of the respective underlying building block indices
as their respective issuers track the applicable sub indices and rebalance those accordingly.
Since inception of the portfolio the costs, as expressed by the Total Investment Charges (TIC),
are 0.66% and annualized tracking difference compared to the index since inception is 0.67%.
A decision has been made by the manger to seek approval from the underlying investors in the
portfolio to amend the fund structure to a Fund of Fund structure that invests in underlying ETFs
that represent the 7 regional headline indices representing the S&P Global 1200 Index (“the
Amendment”).
The impact of the Amendment is that the portfolio will no longer buy and hold underlying
constituents of the S&P Global 1200 Index but only holds the respective iShares ETFs and SPDR
ETFs that represent the constituent indices. The management fee will reduce from 0.37% to
0.25% per annum (exclusive of VAT). which will only become effective once the regulatory
approval of the Amendment has been obtained. The management of the portfolio, income
distributions, risk profile and ASISA classification will all remain as is and will not be changed.
2. Index regional constituents
The initial list of the foreign listed ETFs for inclusion in the Fund of Fund structure, subject to
conclusion of the due diligence requirements of the Act, to be included are:
Weighted Total
Fund Expense Ratio
iShares Core S&P 500 ETF 0.04%
iShares MSCI Europe UCITS ETF EUR Dist 0.11%
iShares S&P/TSX 60 Index ETF 0.01%
iShares Core TOPIX ETF 0.01%
iShares Asia 50 ETF 0.05%
iShares Latin America 40 ETF 0.01%
SPDR S&P/ASX 50 Fund 0.01%
Weighted average total tracking difference 0.24%
3. The changes to the portfolio are summarised as follows:
EXISTING PROPOSED EFFECTIVE DATE
Wednesday, 19 August 2020
ASHBURTON GLOBAL 1200 EQUITY ETF ASHBURTON GLOBAL 1200 EQUITY FUND
OF FUNDS ETF
INDEX INDEX
S&P GLOBAL 1200 INDEX S&P GLOBAL 1200 INDEX
INVESTMENT POLICY INVESTMENT POLICY
3.1 The objective of the portfolio is to 3.1 The objective of the portfolio is to track
replicate and track the economic performance the economic performance of the underlying
of the underlying index, S&P Global 1200 index, the S&P Global 1200 Index as closely
Index (the “Index”), as closely as possible, and as possible and to focus on achieving a total
to focus on achieving a total compound annual compound annual return which will
return which will substantially equate to the substantially equate to the compound annual
compound annual return of the portfolio return of the portfolio benchmark, as adjusted
benchmark, as adjusted to take into account to take into account transaction and other
transaction and other costs and assets in costs and assets in liquid form.
liquid form.
3.2 The portfolio will be a passively
3.2 The portfolio will be a passively managed portfolio in that the Manager will not
managed portfolio in that the Manager will not buy or sell securities based on economic
buy and sell securities based on economic, financial and/or market analysis but rather, will
financial and/or market analysis but rather, will buy and sell securities solely for the purpose
buy and sell securities solely for the purpose of ensuring that the portfolio tracks the S&P
of ensuring that the portfolio tracks the Index. Global 1200 Index.
As such the investment objective and style of
the portfolio will be to generally invest in the 3.3. To achieve the above objective, the
component securities of the Index in Ashburton Global 1200 Equity Fund of Funds
proportion to their weighting in the Index and ETF will, apart from assets in liquid form,
will under normal circumstances aim to invest consists solely of participatory interests in
at least 90% of its total assets in the securities ETFs representing the seven constituent
composing the Index. indices of the S&P 1200 Global Index as per
the weights published by the index provider
3.3 The financial or other condition of any from time to time. Rebalancing of the seven
company or entity included from time to time constituent indices of the S&P 1200 Global
in the Index will not result in the elimination of Index will be as and when the index provider
its securities from the portfolio, unless the (S&P) changes the respective weightings of
securities of such company or entity are the regions that is represented by these. There
removed from the Index itself. is no rebalancing of the respective underlying
building block indices as their respective
issuers track the applicable sub indices and
3.4 In no event will the portfolio be rebalance those accordingly.
managed according to the traditional
approach of active management, rather a 3.4 The Ashburton Global 1200 Equity
passive approach will be applied at all times. Fund of Funds ETF may also include listed or
unlisted financial instruments for the exclusive
purpose of hedging exchange rate risks.
3.5 Nothing in this supplemental deed
shall preclude the Manager from varying the 3.5 The Trustee shall ensure that the
ratios of securities, non-equity securities or investment policy set out in the preceding
assets in liquid form in changing economic clauses is adhered to, if nothing contained in
environment or market conditions, or to meet this clause shall preclude the Manager from
the requirements in terms of legislation and varying the proportions of securities in terms
from retaining cash or placing cash on deposit of changing economic factors or market
in terms of the main deed and this conditions or from retaining cash in the
supplemental deed. portfolio and/or placing cash on deposit.
3.6 The Trustee shall ensure that the 3.6 For the purposes of the Ashburton
investment policy set out in this supplemental Global 1200 Equity Fund of Funds ETF, the
deed is carried out. Manager shall reserve the right to close the
Ashburton Global 1200 Equity Fund of Funds
3.7 For the purpose of this portfolio, the ETF to new investors. This will be done to be
Manager shall reserve the right to close the able to manage the Ashburton Global 1200
portfolio to new investors on a date Equity Fund of Funds ETF in accordance with
determined by the Manager. This will be done its mandate. This critical size shall be
in order to be able to manage the portfolio in determined from time to time by the Manager.
accordance with its mandate. The Manager
may, once a portfolio has been closed, open
that portfolio again to new investors on a date
determined by the Manager.
3.8 Nothing in this supplemental deed
shall preclude the Manager from varying the
ratios of securities, non-equity securities or
assets in liquid form in changing economic
environment or market conditions, or to meet
the requirements in terms of legislation and
from retaining cash or placing cash on deposit
in terms of the main deed and this
supplemental deed.
3.9 The Trustee shall ensure that the
investment policy set out in this supplemental
deed is carried out.
UNDERLYING CONSTITUANTS UNDERLYING CONSTITUANTS
Individual constituents comprising the S&P Foreign listed ETFs comprising their relevant
Global 1200 Index weights in the index. Current list of underlying
constituents are as follows:
iShares Core S&P 500 ETF
iShares MSCI Europe UCITS ETF EUR Dist
iShares S&P/TSX 60 Index ETF
iShares Core TOPIX ETF
iShares Asia 50 ETF
iShares Latin America 40 ETF
SPDR S&P/ASX 50 Fund
MANAGEMENT FEES MANAGEMENT FEES
0.37% 0.25%
TOTAL INVESTMENT CHARGE (TIC) EXPECTED TOTAL IINVESTMENT
CHARGE (TIC)
0.67% 0.49%
DISTRIBUTIONS DISTRIBUTIONS
Quarterly for the end of January, April, July Quarterly for the end of January, April, July
and October and October
4. Ballot voting procedure and implementation of the amendments
In terms of Section 98(2) of the Act and paragraph 59 of the Main Deed of the Scheme, investor
consent is required to affect the Amendments, which state that:
- Investors holding no less than 25% in value of the total number of participatory investors
in the portfolio, excluding any holdings by the manager must respond to the ballot request,
for it to be successful.
- The majority of those who have responded to the ballot must vote in favour for the ballot
to be successful.
- If less than 25% of investors respond, a second ballot must be conducted
5. Action required by investors
- Existing unit holders are requested to notify their JSE Brokers/ CSDPs by no later than 4
August 2020, as to whether they approve the Amendments as set out in this
announcement or not.
- The various Brokers/CSDPs will then submit the ballot responses via ballot form to the
managers registered Auditors, PWC before close of business on Tuesday, 4 August 2020.
- Only votes from unit holders that are recorded on the register as at close of business on
Thursday, 25 June 2020 will be eligible.
- If you have disposed of your participatory interests in the portfolio, no action is required.
6. Approvals and effective days
Approval for the Amendments was granted by the FSCA on 19 June 2020
Provided that the ballot is in favor of the Amendments the changes will be effective from
commencement of business on 19 August 2020.
Copies of the proposed new Ashburton Global 1200 Equity Fund of Funds ETF Supplemental
Deed may be obtained during normal business hours from the office of the Manager, 4 Merchant
Place, Cnr Fredman Drive & Rivonia Road, Sandton and is available on the website:
www.ashburtoninvestments.com
Salient dates in respect of the Amendments are set out below:
Expected timeline for the implementation of the 2020
Amendments
Announcement of proposed amendments and Ballot Monday, 22 June
Extraction date of eligible investors for the Ballot Thursday, 25 June
Last day for investors to respond to their JSE brokers/ CSDPs Tuesday, 4 August
on whether they approve the Amendments as set out in this
announcement or not
Finalization SENS announcement of approval of the Tuesday, 11 August
Amendments
Last Day to Trade in the Ashburton Global 1200 Equity ETF Tuesday, 18 August
(“ASHGEQ”)
Termination of trading of Ashburton Global 1200 Equity ETF Wednesday 19 August
(“ASHGEQ”)
Commencement of trading in Ashburton Global 1200 Equity Wednesday,19 August
Fund of Funds ETF
Record date Friday, 21 August
Accounts of dematerialised securities holders updated at their Monday, 24 August
CSDPs or brokers
7. Notices
Ashburton Global 1200 Equity Fund of Funds ETF participatory interests are not in any way
sponsored, endorsed, sold or promoted by the JSE and it does not make any warranty or
representation whatsoever, expressly or implied, either as to the basis of calculation of, or as to
the results to be obtained from the use of S&P Global 1200 Index.
The securities being issued pursuant to this supplement are not eligible for sale in the United
States or in any other jurisdiction in which trading in the securities would be illegal. The securities
have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended,
and the U.S. Commodity Futures Trading Commission under the U.S. Commodity Exchange Act
has not approved trading in the securities. The securities may not be offered, sold or delivered
within the United States or to U.S. persons, nor may any U.S. person at any time trade or maintain
a position in the securities
22 June 2020
Trustee: Standard Chartered Bank
Date: 22-06-2020 05:05:00
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