Important Changes to Fidelity Funds. Key Points

Transcription

1 Important Changes to Fidelity Funds Key Points The Fidelity Funds Global Real Asset Securities Fund will merge into Fidelity Funds Global Focus Fund on 23 May If you agree with the Merger you do not need to take any further action. If you do not agree with the Merger you may switch or redeem your investment into any other fund within Fidelity Funds available to you free from any switching or redemption charge. As there are Share classes in the Merging Fund that do not exist in the Receiving Fund certain Share classes will be launched in advance of the Merger. The Fidelity Funds - Global Real Asset Securities Fund A-ACC-SGD Share class will close on 12 May 2016, in advance of the Merger. 23 February 2016 Dear Shareholder, Merger of Fidelity Funds Global Real Asset Securities Fund into Fidelity Funds Global Focus Fund We are writing to inform you that the Board of Directors of Fidelity Funds (the Board ) has taken the decision to merge Fidelity Funds Global Real Asset Securities Fund (the Merging Fund ) into Fidelity Funds Global Focus Fund (the Receiving Fund ) with effect from 23 May 2016 (the Effective Date ). Our records show that you are a shareholder (the Shareholders or you ) in one or both of these funds. For more information on the impacted Share classes, please refer to the ISIN Codes listed in Appendix I. The Board has decided to take this action because the assets of the Merging Fund have been declining over the past few years. The Board believes that there is no future prospect for the Merging Fund and has decided to merge the assets of the Merging Fund into those of the Receiving Fund. Both funds have the same annual management charge and we anticipate no impact for Shareholders in the Receiving Fund. The Board believes that the proposed merger (the Merger ) is in the best interests of Shareholders and the Merger will be conducted in accordance with Article 21.bis of the Articles of Incorporation of Fidelity Funds (the Articles ) and Article 1 (20) a) and Chapter 8 of the Law of 17 December 2010 on undertakings for collective investment. Further details on the Merger are provided below and there is no need for you to take any action if you agree with the proposal. However, Shareholders who do not wish to participate in the Merger may either switch into another fund within Fidelity Funds that is available to them or sell their holdings. Both options are free of charge. Comparison of investment objectives, risk profiles and ongoing charges of the Merging Fund and the Receiving Fund The investment objective of the Merging Fund is as follows: 1

2 The fund aims to achieve long-term capital growth from a portfolio primarily invested in equity securities of companies across the world that provide exposure to commodities, property, industrials, utilities, energy, materials and infrastructure. Up to 20% of the portfolio can consist of investments in Exchange Traded Funds ( ETFs ), Exchange Traded Commodities qualifying as transferable securities ( ETCs ), bonds, warrants and convertibles. The manager is free to select any company regardless of size, industry or location and will concentrate its investment in a more limited number of companies and therefore the resulting portfolio will be less diversified The investment objective of the Receiving Fund is as follows: The fund aims to achieve long-term capital growth from a portfolio primarily invested in stocks across the world s stock markets. The manager is free to select any company regardless of size, industry or location and will concentrate its investments in a more limited number of companies and therefore the resulting portfolio will be less diversified. The risk factors of the Merging Fund and of the Receiving Fund are the same and are described in the table below: GENERAL RISKS THAT APPLY TO ALL FUNDS Applicable Risk Factors* EQUITY RELATED RISK COUNTRY, CONCENTRATION AND STYLE RELATED RISK DERIVATIVES RELATED RISKS Fidelity Funds - Global Real Asset Securities Fund Fidelity Funds - Global Focus Fund * For further information on these risk categories, please refer to the section 1.2. Risk Factors in the latest Fidelity Funds Prospectus. Synthetic Risk and Reward Rating Indicator ( SRRI) The Synthetic Risk and Reward Rating Indicator for Global Focus (5) is slightly lower than for Global Real Assets (6), meaning that clients will move to a product with a similar but slightly lower equity risk indicator. Lower risk Higher risk Lower risk Higher risk You should read the Product Highlights Sheet of the Receiving Fund as well as the Fidelity Funds Singapore Prospectus (the Prospectus ) for further information. These documents are available from FIL Investment Management (Singapore) Limited (as the Singapore Representative of Fidelity Funds) or at Shareholders are required to read these documents. Important note: 2

3 Shareholders should pay attention to the fact that certain Share classes do not currently exist in the Receiving Fund, therefore additional Share classes will be launched to support this Merger. The Board also decided to close certain Share classes in the Merging Fund, details of which can be found in the Share class closure section of this letter. As at 30 April 2015, the Total Expense Ratio (the TER ) of the existing Share classes in the Merging Fund and the corresponding Share classes in the Receiving Fund were as follows: Classes of Shares TER of Fidelity Funds Global Real Asset Securities Fund Securities Fund A-ACC-EUR (hedged) Securities Fund A-ACC-SGD Securities Fund A-ACC-USD Securities Fund I-ACC-USD Share class to be merged to/or to be closed 1.98% FF - Global Focus Fund A-ACC-EUR (hedged) to be launched on 12 May 2016 TER of Fidelity Funds Global Focus Fund 1.97 N/A 1.93% Share class to be closed on 12 May % FF - Global Focus Fund 1.92 A-ACC-USD to be launched on 12 May % FF - Global Focus Fund 0.89 I-ACC-USD to be launched on 12 May 2016 The Board believes that the Merger will not trigger a dilution in the performance of the Receiving Fund. Costs of the Merger The expenses triggered by the Merger, including any legal, audit, regulatory and mailing charges will be borne by FIL Fund Management Limited, the Investment Manager of Fidelity Funds. There are no unamortised preliminary expenses outstanding in respect of the Merging Fund. Any additional liabilities attributable to the Merging Fund, accruing after 4.00 pm Singapore time on the Effective Date, will be borne by the Receiving Fund. Next Steps If you agree with these changes you do not need to take any action. The Merger will proceed as set out in the Articles and the Prospectus. All issues, switching and redemptions of Shares in the Merging Fund will be suspended from 4.00 pm Singapore time* on 13 May Shareholders should note that in the week prior to the Effective Date of the Merger, the intention is that the portfolio of the Merging Fund be rebalanced to match the portfolio of the Receiving Fund and all transaction costs arising from this rebalancing will be borne by the Merging Fund. From this point, the Merging Fund will follow the investment objective of the Receiving Fund. Shareholders of the Merging Fund may deal in their newly issued Shares in the Receiving Fund from the open of business on 24 May Any accrued income on investments in the Merging Fund at the time of the Merger will be included in the final Net Asset Value per Share of the Merging Fund and such accrued income will be accounted for on an on-going basis after the Merger in the Net Asset Value per Share of the The TER represents the total expense borne by the fund over a year and are stated with reference to the Net Asset Value per Share. It is calculated at the fund's financial year end and may vary from year to year. It has been calculated by Fidelity, in accordance with the latest guidelines issued by the Investment Management Association of Singapore and it excludes: performance fees (where applicable); interest expenses; foreign exchange gains and losses of the fund; and portfolio transaction costs. This Share class will not be launched in Singapore if there are no Singapore Shareholders in Securities Fund A-ACC-EUR (hedged) at the time of the Merger. This Share class has not yet launched, and therefore the TER is an estimated figure only. + Please refer to section Closure of the Securities Fund A-ACC-SGD Share class of this letter. 3

4 Receiving Fund. If Shareholders of the Merging Fund have not redeemed or switched their Shares by 13 May 2016, their existing Shares will be automatically converted into Shares of the corresponding Share class in the Receiving Fund. Shareholders of the Merging Fund will receive a number of Shares of the Receiving Fund, the total value of which will correspond to the total value of their existing Shares in the Merging Fund. This will be determined by multiplying the number of Shares of the corresponding class of the Merging Fund by the exchange ratio. The exchange ratio for the conversion of the Shares in the Merging Fund into the corresponding Shares in the Receiving Fund will be determined on the basis of the last available Net Asset Value of the Share classes concerned on 20 May 2016 as of close of business. The number of Shares of the Receiving Fund to be received by Shareholders of the Merging Fund may not be the same as the number of Shares they held in the Merging Fund. Shareholders of the Merging Fund will receive a written confirmation of the number of Shares which they will receive in the Receiving Fund post- Merger. If you are not in agreement with these changes, we are offering you a free switch of your existing Shares in the Merging Fund and/or in the Receiving Fund into any other fund within Fidelity Funds available to you, or you may choose to redeem your existing Shares in the Merging Fund and/or in the Receiving Fund free of charge. 1. For Shareholders who are currently investing in the Receiving Fund using their Supplementary Retirement Scheme (SRS) monies, there are two options available to you. For both options, you are required to bear the charges by your own SRS agent bank. A switch, free of switching charge, of all of your class A-USD Shares into any other class A Shares of another fund of Fidelity Funds available to you under SRS. Please refer to the Prospectus for the list of funds that are available for investment under the SRS^; or Redemption of all of your holdings in the Receiving Fund, free of redemption charge. The proceeds will be credited directly to your previously advised bank account details. 2. For Shareholders who are currently investing in the Receiving Fund using their CPFIS Ordinary Account (OA) monies, there are two options available to you. For both options, you are required to bear the charges by your own CPF agent bank. A switch, free of switching charge, of all of your class CPF shares into any other class CPF shares of sub-fund of Fidelity Funds that are currently included under CPFIS OA. Please refer to the Prospectus for the list of sub-funds that are available for investment under the CPFIS^; or Redemption of all of your holdings, free of redemption charge. The proceeds will be paid to your CPF Investment Account held with your agent bank. 3. For all other Shareholders who are currently investing in either the Merging Fund and/or in the Receiving Fund, there are two options available to you: A switch, free of switching charge, of any of your holdings in either the Merging Fund and/or in the Receiving Fund into another fund of Fidelity Funds available to you; or Redemption of all of your holdings in either the Merging Fund and/or in the Receiving Fund, free of redemption charge. The proceeds will be credited directly to your previously advised bank account details. If you wish to redeem or switch, you should contact either your financial adviser or usual Fidelity contact. Redemptions or switches free of charge can be instructed on any Valuation Date until 4.00 pm Singapore time* on 13 May 2016 starting from the receipt of this letter, and will normally be dealt with at the next calculated Net Asset Value per Share. Upon request, copies of the audit report prepared by the approved statutory auditor of Fidelity Funds in relation to the Merger may be obtained free of charge at the registered office of Fidelity Funds. 4

5 The proposed Merger will have no tax implications for the Merging Fund or the Receiving Fund. Shareholders of the Merging Fund should note that the Merger may be treated for tax purposes as a disposal of Shares depending on personal circumstances and the tax legislation in the various jurisdictions where Shareholders reside. Equally, please note that the redemption or the switching of your holding may be deemed as a disposal for tax purposes. If you have any concerns about your tax position, we recommend that you seek independent tax advice. Closure of the Securities Fund A-ACC-SGD Share class The Securities Fund A-ACC-SGD will close on 12 May 2016 (the Closure ). The Board has taken the decision to effect the Closure, in compliance with the Articles, as the total size of investments in this Share class continues to be small and is not expected to grow after the Merger. It should be noted that further subscriptions and switches into the Share class will not be permitted from 4.00 pm Singapore time* on 5 May If you are a Shareholder in the above Share class, then there are three options available to you: 1. You may instruct us to switch your investment into any other Share class available to you in another fund of Fidelity Funds available to you free from any switching charges at the next calculated Net Asset Value per Share. You may do this on any Valuation Date until 4.00 pm Singapore time* for any other fund on the Business Day before the closure date. 2. You may redeem your investment free from any redemption charge at the next calculated Net Asset Value per Share on any Valuation Date until 4.00 pm Singapore time* on the Business Day before the closure date. The proceeds will be credited directly to your previously advised bank account details. 3. You may take no action, in which case your investment will be automatically redeemed in the Share class currency free from any redemption charge at the Net Asset Value calculated on the closure date and the proceeds sent directly to your bank thereafter. In case Fidelity holds no records of your bank account details in the share class currency, we would need to send you a cheque. To prevent this, we kindly ask you to switch or redeem your shares before the closure date. If you wish to redeem or switch as per steps 1. and 2. above, you should contact either your financial adviser or usual Fidelity contact. Please note that the redemption or the switching of your holding may be deemed as a disposal for tax purposes. If you have any concerns about your tax position, we recommend that you seek independent tax advice as we are not authorised to provide such a service. Amounts which cannot be distributed due to out-of-date or incorrect Shareholder information will be held in escrow accounts by the Caisse de Consignation in Luxembourg. The Board accepts full responsibility for the accuracy of the content of this letter and confirms, having made all reasonable enquiries, that to the best of its knowledge and belief there are no other facts the omission of which would make any statement herein misleading. Any terms not defined in this letter shall have the same meaning as in the Prospectus of Fidelity Funds. If you have any questions related to this proposal please contact your usual financial adviser or FIL Investment Management (Singapore) Limited at Yours sincerely, 5

6 Marc Wathelet Director, FIL (Luxembourg) S.A. Corporate Director, Fidelity Funds (^) Shareholders should contact their own distributors or financial advisors for funds that are available to them for investment. * Please note that different procedures may apply if dealing in Shares is made through distributors or other intermediaries. Please note that some distributors or other intermediaries may charge additional fees (such as switching or transaction fees) or other expenses at their own discretion. For further information on these please contact your financial adviser or your usual contact at the distributor / intermediary whom you transact with. 6

7 Appendix I - List of ISIN Codes Classes of Shares Securities Fund A-ACC-EUR (hedged) Securities Fund A-ACC-SGD to be closed on 12 th May 2016 Securities Fund A-ACC-USD Securities Fund I-ACC-USD FF - Global Focus Fund A-USD FF - Global Focus Fund A-ACC-EUR (hedged) to be launched on 12 th May 2016 FF - Global Focus Fund A-ACC-USD to be launched on 12 th May 2016 FF - Global Focus Fund I-ACC-USD to be launched on 12 th May 2016 ISIN Codes LU LU LU LU LU TBC TBC TBC This Share class will not be launched in Singapore if there are no Singapore Shareholders in Securities Fund A-ACC-EUR (hedged) at the time of the Merger. 7