Fund merger - Barings Developed and Emerging Markets High Yield Bond Fund

We have been informed by the Directors of Baring International Fund Managers (Ireland) Limited (“Barings”) of its decision to merge the Barings Developed and Emerging Markets High Yield Bond Fund, which is a sub-fund of the Barings Global Umbrella Fund range (“the Merging Fund”), into the Barings Developed and Emerging Markets High Yield Bond Fund, a sub-fund of the Barings Umbrella Fund plc range (the ”Receiving Fund”), with effect from 2 December 2022 (“the Effective Date”). 

We feature the following share class of the Merging Fund in Preference: 

Barings Developed and Emerging Markets High Yield Bond A Inc USD ("the Merging Fund Share Class").

The Merging Fund Share Class is now closed to investment/switches-in from new unitholders until 5 December 2022 when the merger has completed. Existing unitholders can continue to invest in the Merging Fund Share Class, however, please refer to the ‘Impact to Preference unitholders’ section below with regard to the merging period.

Background to the merger

Barings has decided, in consultation with the fund’s Investment Manager, that the merger is in the best interests of unitholders in order to simplify the Barings fund range offering and improve the client experience. From the Effective Date, it is expected that the Merging Fund unitholders will pay the same or lower fees, charges and expenses for their holdings in the new shares of the Receiving Fund.

Investment objective and strategy comparison

The Receiving Fund is being established solely for the purpose of continuing the investment objective and strategy of the Merging Fund. The Receiving Fund will only be launched upon receipt of all net assets from the Merging Fund. The Receiving Fund has been set up with similar characteristics as the Merging Fund, thus allowing long-term continuity and track record of the strategy. The investment policies, investment strategies, and risk profile of the Merging Fund and the Receiving Fund are materially the same, and it is the current intention of the Investment Managers to manage the Receiving Fund in the same manner as the Merging Fund immediately after the Merger.

Impact to our Preference policyholders

The Merging Fund will continue to accept subscription and redemption requests until the dealing cut off on Monday 28 November 2022. Dealing in the Receiving Fund will resume from Monday 5 December 2022. For the period in between, we will not be able to process any instructions from policyholders for tops ups or redemptions for the Merging Fund Share Class. Pricing will also be temporarily suspended by Barings during this period.  

On the Effective Date, the Barings Developed and Emerging Markets High Yield Bond Fund will resume pricing, will then form part of the Barings Umbrella Fund plc fund range and will be detailed in the Barings Umbrella Fund plc prospectus document.

Barings has advised that on the Effective Date, the number of new shares to be issued to each Merging Fund unitholder will be calculated using a ratio of 1:1 as it is intended that the initial offer price of the Receiving Fund will be set to match the net asset value per unit of the Merging Fund. The Valuation Point is 12pm Irish time. As a result, the value of new shares which Preference policyholders will receive under the merger will equal the value of their existing units immediately prior to the Effective Date.

The Merging Fund ISIN will be adopted by the Receiving Fund. Therefore the Receiving Fund Share Class in Preference will keep the same ISIN, however, its name will change slightly, as ‘A’ share classes are being transferred into ‘G’ share classes.

We have written to impacted policyholders. A copy of the letter can be found opposite which provides full details of the merger and the options for policyholders if they would prefer to switch to a different fund in the Preference range.

For more details about Barings visit https://www.barings.com