On 24 September Magellan announced a distribution policy update for the funds for which it acts a responsible entity (‘Fund’ or ‘Funds’).
For each Fund, Magellan intends to target a specific cash distribution yield (“Target Cash Distribution”) and pay distributions semi-annually. Each Fund’s Target Cash Distribution per unit for each semi-annual period will be based on the average of the month-end net asset values per unit applicable to a Fund, or a Fund’s unit class, over a two year rolling period and will be announced at the beginning of each semi-annual distribution period.
This update harmonises the distribution policies across Magellan’s Funds and, Magellan believes, provides investors with greater certainty on the amount of upcoming cash distributions.
For further information and for the Target Cash Distribution per annum for each Fund, please click here.
On 3 August Magellan announced a proposed restructure of three Global Equities retail funds. Please see below a link to the announcement and updates to the Product Disclosure Statements for Magellan Global Fund and Magellan Global Equities Fund
Set out below are the upcoming changes that impact the following registered managed investment schemes.
From 18 November 2019, Magellan Asset Management Ltd (“Magellan”) will no longer be offering Direct Debit as a payment option for additional investments to the Funds above. In place of Direct Debit, Magellan will be introducing BPAY® as a payment option. The minimum amount for an additional investment made using BPAY® will be $500 for all Funds above, other than Magellan High Conviction Fund - Class B Units which will be $1,000.
Electronic Funds Transfer (EFT) and Australian Dollar Cheque will continue as payment methods for additional investments. The minimum amounts for additional investments by these methods will remain unchanged at $5,000 for each Fund, other than Magellan High Conviction Fund – Class B Units which will be $10,000.
From 20 November 2019, Regular Monthly Investment Plans (“Plans”) administered by means of Direct Debit will no longer be available. For those investors who currently have a Plan set up, the last Direct Debit from a nominated bank account will occur on this date. The easiest way for investors to either continue to, or start to, add to existing investments on a regular basis would be to set up a recurring BPAY® payment with their financial institution.
Information on how to set up BPAY® will be available on our website by the end of November.
A unit pricing error has been identified in The Airlie Concentrated Share Fund (the “Fund”). The error is the result of management and trustee fees (the “fees”) not being calculated and charged to the Fund in accordance with the Fund’s Constitution.
Magellan Asset Management Limited (“Magellan”), Responsible Entity to the Fund, has assessed the amount of compensation owed to all investors in the Fund. Compensation was assessed as payable to investors (relative to their holdings in the Fund) if actual fees paid by the Fund each month were greater than the fees that should have been charged.
All existing investors that were adversely impacted by the error have been compensated by Magellan by way of additional units in the Fund. The compensation to exited unit holders (who were adversely affected by $20 or more) has been funded by Magellan and includes an allowance for the time value of money. Magellan has sent written communication about the error to all investors that were adversely impacted.