01 November 2016
Important information for unit holders in Carnegie Emerging Markets and Carnegie
Asia
Carnegie Emerging Markets will merge with Carnegie Asia on 2 February 2017
We continuously evaluate and develop our range of funds. The Carnegie Emerging
Markets fund has not lived up to our expectations and we have therefore decided to
close it. If you are a holder of units in Carnegie Emerging Markets you will instead
become a unit holder in Carnegie Asia. If you are already a holder of units in Carnegie
Asia you are not affected by this merger.
Background and reasons
The board of directors of Carnegie Fonder AB has decided to merge the Carnegie
Emerging Markets and Carnegie Asia funds through absorption. This procedure will
merge Carnegie Emerging Markets (the merging fund) into Carnegie Asia (the acquiring
fund). Unit holders in Carnegie Emerging Markets will therefore receive new Unit Class
A units in Carnegie Asia at a value corresponding to the value of the units in Carnegie
Emerging Markets at the date of the merger. This also means the Carnegie Emerging
Markets fund will be dissolved.
The reason for the board’s decision is that Carnegie Emerging Markets is operating
under difficult market conditions and, unlike Carnegie Asia, has not performed in line
with our expectations. The merger will provide Carnegie Asia with assets that will also
permit some efficiencies in the fund management.
Likely consequences of the merger for fund unit holders
Carnegie Asia is an equity fund focused on Asian companies and non-Asian companies
that have their main activities in Asia (excl. Japan). The objective of the management of
the fund is to achieve a good long-term return that is at least on par with the average
performance of the equity markets in the region, while observing due care. The fund
seeks to achieve a well-diversified portfolio of securities. Under normal circumstances,
the proportion of cash and equivalents will be low. The investment policy is broad,
which means investments are made in a variety of companies in different industries. The
fund is actively managed and does not track an index. The real difference between
Carnegie Emerging Markets and Carnegie Asia is that Carnegie Asia is more
geographically focused.
It is important that unit holders in the Carnegie Emerging Markets fund read the key
investor information document for the Carnegie Asia fund since it contains relevant
information for prospective unit holders.
The changes for unit holders in Carnegie Emerging Markets are not particularly
substantial since Asian equities already make up 70% of the investment universe of the
Carnegie Emerging Markets fund. Ahead of the merger, however, the composition of the
CARNEGIE FONDER AB
Box 7828, 103 97 Stockholm, Sweden
Regeringsgatan 56
Telephone: +46 8 5886 93 60
Fax: +46 8 5886 93 93
www.carnegiefonder.se
Crop ID: 556266-6049.
Registered office: Stockholm
assets in the Carnegie Emerging Markets fund will be adjusted to match that of the
Carnegie Asia fund. Most of this adjustment will be made on 25 January 2017. All of the
changes are in accordance with the fund rules for the Carnegie Emerging Markets fund.
The risk profiles of the two funds are similar and the funds are exposed to similar risks,
as set out in the fund rules for each fund.
The Carnegie Emerging Markets fund has been able to pay dividends (the latest dividend
paid was in 2012). The Carnegie Asia fund does not pay dividends. This means that the
changes for unit holders in the Carnegie Emerging Markets fund are in practice marginal.
The merger results in no dilution effects for unit holders in either Carnegie Emerging
Markets or Carnegie Asia.
The annual management charge for Carnegie Asia (1.93% in 2015) is slightly higher than
the annual charge for Carnegie Emerging Markets (1.84% in 2015).
Holders of units in Carnegie Asia are not affected by the merger. Following the merger,
Carnegie Asia will probably have significantly greater assets under management.
However, given the size of the market, the fund will still be a small investor in the
context, without the restrictions that a large fund can experience when buying and selling
securities. The merger will not lead to any dilution effect on the gains generated by fund
management for Carnegie Asia.
The merger has no tax consequences (capital gain/loss) for those liable to pay tax in
Sweden.
Valuation of assets and liabilities when calculating the exchange ratio
Assets and liabilities will be valued at market value using the valuation policies applied by
the funds, as set out in Section 8 of the fund rules.
The exchange ratio will be calculated on the valuation date of 31 January 2017 by
dividing the unit price of the merging fund by the unit price of the acquiring fund using
the NAV values established on the valuation date.
Planned date for completing the merger
The merger is scheduled for 2 February 2017, based on the exchange ratio on 31 January
2017. The Carnegie Emerging Markets fund will be open for purchases until 25 January
2017.
Rules for the transfer of assets and exchange of units
On the day of the merger, all assets in the merging fund will be transferred to the
acquiring fund. This transfer will take place at the depositary (SEB). Valuation of the
acquiring fund on the merger date will take place including the transferred assets. This
means that the value of the merging fund on the date of the merger will be 0 following
the transfer of assets.
Units in the merging fund will be replaced on the merger date with units in the acquiring
fund using the exchange ratio for the unit values on 31 January 2017 ((number of units in
merging fund x factor for exchange ratio) x unit price for acquiring fund)). No cash
reimbursement will be paid.
Any accrued income will be calculated and reported in accordance with the accounting
rules applied by the funds.
The rights of unit holders
Holders of units in Carnegie Emerging Markets and/or Carnegie Asia have the right to
redeem their units free of charge before the merger is completed. As usual, it is also
possible to switch from your fund to one of our other funds. Requests to redeem units
or switch funds must be received by us not later than 30 January 2017 at 4:00 pm (CET)
for Carnegie Asia, and not later than 31 January 2017 at 4:00 pm (CET) for Carnegie
Emerging Markets in order to be executed prior to the merger.
In addition, unit holders have the right, on request, to receive a copy of the opinion of
our external auditor on reviewing the merger.
Important dates
1. Information to unit holders via website and letter sent 31 October 2016.
2. For unit holders that do not wish to be invested in Carnegie Asia following the merger,
the deadlines to redeem units are 30 January 2017 for Carnegie Asia and 31 January 2017
for Carnegie Emerging Markets.
3. On 25 January 2017 the composition of assets in Carnegie Emerging Markets will be
adjusted to the composition in Carnegie Asia.
4. Carnegie Emerging Markets will be closed for the purchase of units from 26 January
2017.
5. The record date and date for calculation of the exchange ratio is 31 January 2017.
6. The date of the merger is 2 February 2017.
7. From 3 February 2017 the new unit holders in Carnegie Asia will be able to exercise their
rights as fund unit holders.
For more information, please read the key investor information documents and the
prospectuses for the funds, which are available on the fund company’s website at
http://www.carnegie.se/fonder/vara-fonder/ , or contact our fund specialists by calling
+46 8 588 693 50 or by emailing [email protected]
Best regards,
CARNEGIE FONDER AB
Hans Hedström
Chief Executive Officer