Magellan Financial Group Limited (“Magellan”) is undertaking an initial public offering (“Offer”) for the Magellan Global Trust.
The Magellan Global Trust will invest in a focussed portfolio of high quality global companies and intends to target a 4% cash distribution yield. Magellan Asset Management Limited (“MAM”) will be the investment manager and act as the responsible entity. MAM will draw upon its deep investment expertise in global equities (with over 30 investment analysts), with Hamish Douglass and Stefan Marcionetti acting as the portfolio managers.
The Offer will comprise a priority offer and a broker firm/general public offer. The priority offer is to be made to approximately 250,000 to 300,000 underlying Magellan shareholders and investors in Magellan retail strategies. The priority offer will offer eligible applicants a valuable loyalty reward of additional Units worth 6.25% of the value of Units allotted to them under the priority offer. The one-off cost of the loyalty reward will be paid for by Magellan.
Magellan will also pay all the costs of the Offer in cash so that the opening cash net asset value per Unit is equal to the application price of $1.50 per Unit.
Mr Hamish Douglass, CEO and Chief Investment Officer, said today: “We believe that the Magellan Global Trust will be an attractive vehicle for investors making an investment in global equities. We believe that many retail investors value regular cash distributions and this has been missing in many global equity products. We consider that the target 4% cash distribution yield differentiates this offering from many other global equity products.” “We have sought to align the interests of investors with those of Magellan. We are picking up all of the costs of the Offer so that the opening cash net asset value per Unit is equal to the cash paid by investors and we are putting in place an attractive distribution reinvestment plan with a 5% discount in respect of the cash distribution. The amount of the discount will be paid for by Magellan.” “We also deeply value the support we have received from our many investors and shareholders. As a sign of our appreciation we are delighted to offer our supporters a valuable loyalty reward worth 6.25% of the value of Units allotted to them under the priority offer. The full amount of the loyalty reward will be paid for by Magellan.”
About the Magellan Global Trust
The Magellan Global Trust will be a closed end investment trust listed on ASX:
• Investment mandate: The Magellan Global Trust will invest in a focussed portfolio (15-35 companies) of high quality global companies. The investment mandate will be flexible to enable the Magellan Global Trust to hold up to 50% of the portfolio in cash. It is also intended to manage the currency exposure.
• Attractive distribution yield: The Magellan Global Trust will target a cash distribution yield of 4% p.a., paid semi-annually. The first distribution of 3.0 cents per Unit is expected to be paid in January 2018 and the second distribution of 3.0 cents per Unit is expected to be paid in July 2018. A distribution reinvestment plan (“DRP”) will be offered on the cash distribution with a discount of 5.0% to the prevailing net asset value per Unit. To ensure the DRP is fair to non-participating Unitholders Magellan has agreed to reimburse the Magellan Global Trust for the value of the discount on Units issued under the DRP.
For further information, please see www.magellangroup.com.au.
