LONDON (Alliance News) - JPMorgan Income & Growth Investment Trust PLC, which has a fixed life and is due to wind up in November, on Wednesday gave shareholders the choice of accepting a cash exit or choosing to roll over into new shares issued by JPMorgan Elect PLC.
The rollover into new JPMorgan Elect shares would be efficient both in terms of tax and cost, the trusts said in separate statements, while a cash exit would be at the net asset value - the difference between assets and liabilities - of JPMorgan Income & Growth after subtracting costs.
With net assets of about GBP272.2 million, JPMorgan Elect has three share classes, each with distinct investment policies, objectives and underlying investment portfolios. Conversion between those share classes is allowed on a quarterly basis.
Its Managed Growth share class aims for long-term capital growth from investments in investment trusts and open-ended funds managed in the main by JPMorgan Asset Management.
The Managed Income class seeks to grow income with potential for long-term capital growth by investing in equities, investment companies and fixed income securities, while the Managed Cash class looks to preserve capital with a yield based on short term interest rates by investing in liquidity funds and short dated AAA-rated UK or G7 government securities hedged into sterling.
It is expected that each of JPMorgan Elect's share classes will be made available as rollover options.
"There is a high degree of overlap between the underlying holdings of the company and those of JPMorgan Elect's Managed Income share class, and the company's shareholders will have the option to benefit from continuity of management as the company's portfolio managers are also responsible for managing JPMorgan Elect's portfolio," JPMorgan Income & Growth said in a statement.
Shares in JPMorgan Income & Growth, which is due to wind up on or around November 30, closed down 1.5% at 98.50p on Wednesday.
Later, JPMorgan Income & Growth said it will remain fully invested with gearing maintained at GBP20 million over the remaining months of its life.
"This guidance should allow shareholders to make investment decisions with full knowledge of the exposure of JPMorgan Income and Growth. In extraordinary circumstances the board will reconsider this position. We shall announce any meaningful changes in asset allocation," Chairman Karl Sternberg said in a statement.
The trust said its final full year was a "more difficult period" than each of the previous five years. Shareholders' funds fell by 4.0% in the year ended January 31, though this was nearly 1.0% ahead of its benchmark, the FTSE 350 index. Over five years the annualised total return on shareholders funds has been 8.9%, versus 5.4% for the benchmark.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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