London-headquartered asset manager M&G Investments is proposing to move assets of four of its UK-domiciled open-ended strategies to equivalent Sicav funds on its Luxembourg platform ahead of Brexit.
The proposals, which require fund shareholder approval, aim to protect the interests of M&G’s non-UK
domiciled customers as the UK negotiates its exit from the European Union, said M&G in a statement.
Both Luxembourg and Britain’s financial market regulators have already approved the proposals, which will be sent to fund shareholders in early September.
If they give their green light, M&G expects to transfer the assets to the new Luxembourg funds towards the end of November.
The four funds, which have a cumulative market value of £6bn (€6.8bn), are distributed exclusively outside the UK.
The list includes the M&G Dynamic Allocation Fund, the M&G Income Allocation Fund, the M&G Prudent Allocation Fund and the M&G European Inflation Linked Corporate Bond Fund.
Following the move, the M&G Prudent Allocation Fund will be renamed M&G (Lux) Conservative Allocation Fund as a Luxembourg-domiciled Sicav.
The four Luxembourg Sicav funds will follow identical strategies to the current UK-domiciled funds and will be run by the same fund managers.
Anne Richards, chief executive of M&G, said: “With little clarity yet on the outcome of the negotiations between the UK and the rest of the European Union on its future trading relationship, we believe it is prudent to take action now to protect the interests of our international customers.
“The proposals to transfer the assets of these four funds have a primary aim – to minimise disruption for our investors. Approval of the transfer will ensure they retain access to the same strategies and the same fund managers.”
As of 31 March 2017, M&G managed around £275bn (€312.3bn) of assets.