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(Alliance News) - JPMorgan Global Growth & Income PLC and Henderson International Income Trust PLC on Friday said they have agreed on a combination, creating an investor with GBP3.4 billion in net assets.
The proposed deal between the London-based investment trusts will see HINT's assets rolled into JGGI, under a scheme of reconstruction.
There is no cash option proposed, due to the "strong rating and liquidity" of JGGI shares, as well as the similarity of both firms' investment strategies.
"Investment trusts are in the spotlight at present, and there are growing calls from investors for consolidation, with the emphasis on the need for larger, more liquid vehicles that offer highly competitive cost structures," said JGGI Chair James Macpherson.
More than 85% of HINT's shareholders are also shareholders of JGGI, the trusts added.
JGGI generated a net asset value total return of 22.4% over the last year, compared to HINT's return of 9.6% over the same 12-month period.
JPMorgan Asset Management will manage the enlarged JGGI. HINT is managed by Janus Henderson.
The merger follows JGGI's combination with JPMorgan Multi-Asset Growth & Income last year, and its tie-up with JPMorgan Elect PLC and Scottish Investment Trust in 2022.
HINT Chair Richard Hills said: "The board believes that the proposed combination will provide shareholders with access to a larger, more liquid vehicle with an outstanding track record and a history of growing dividends whilst focusing on the most attractive investment opportunities."
Following the completion of the deal, the JGGI board will consist of seven total directors, six of which will be from the current JGGI board, and one from the board of HINT. The HINT director is expected to step down within the next 12 months, after a transitionary period, reverting the board to six directors.
The deal is expected to conclude by July 2025.
Shares in JGGI were down 0.7% at 604.53 each in London on Friday morning. HINT shares were up 5.7% at 177.50p.
By Emily Parsons, Alliance News reporter
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