abrdn China to merge with Fidelity China Special Situations

investmentweek.co.uk:

Fidelity China Special Situations will continue to be managed by FIL Investment Management (Hong Kong) with Dale Nicholls carrying on as portfolio manager.

Following the transaction, which must be approved by both trusts' shareholders, the enlarged Fidelity China Special Situations (FCSS) will continue to be managed to achieve long-term capital growth from an actively managed portfolio made up primarily of securities issued by companies listed in China and Chinese companies listed elsewhere.

FCSS will continue to be managed by FIL Investment Management (Hong Kong), with Dale Nicholls carrying on as portfolio manager.

As part of the deal, shareholders of the enlarged Fidelity China Special Situations will pay a lower ongoing charges figure and see a drop in the second tier of management fees above £1.5bn of net assets to 0.65%, down from its current 0.70%.

abrdn Smaller Companies Income trust to merge with Shires Income

The abrdn China Investment Company (ACIC) will be wound up, with its cash and assets transferred to the Fidelity trust. Its shareholders who choose to rollover to the enlarged Fidelity trust will be issued new shares in that, in exchange for their current holdings.

There is also a cash exit opportunity for shareholders who do not want to be part of the rollover, of up to 33% of the abrdn's shares in issue, at a 2% discount to ‘formula asset value' per ordinary share.

According to the Association of Investment Companies, ACIC currently holds £228.6m in assets and is trading at a 17.9% discount to net asset value.

Explaining the deal in a note to the stock exchange, the board of the abrdn China Investment Company said it has been working on ways to address the concentration of the trust's share register