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Henderson to merge bond funds

Henderson Global Investors is seeking investor approval to merge the Henderson Global Bond fund into the Henderson Overseas Bond fund following a review of its fund range.

The Henderson Global Bond fund had assets under management of just £726,765 at August 24. The £225.3m Henderson Overseas Bond fund is managed by Global Bond fund manager Kevin Adams and Joanna Murdock.

“Based on the current AUM [assets under management] of the fund and the fact that we believe it is unlikely that the fund will attract significant levels of new inflows, we believe that the fund will be unable to grow at a rate that would either continue to make it feasible from a commercial viewpoint or enable it to maximise returns for investors,” writes chief investment officer and managing director of investment management David Jacob.

“By merging the Henderson Global Bond fund with the Henderson Overseas Bond fund we believe that investors will benefit from retaining exposure to fixed income investments issued by overseas governments but in a larger fund.”

If approved by investors the merger will take place on October 25. Dealing in the Overseas Bond fund will be suspended immediately after the valuation point on October 25 and is set to resume on October 29.

The Global Bond fund, a qualified investor scheme, will be merged into the Ucits Overseas Bond fund, which will allow the former to be sold to a wider range of investors.

The Overseas Bond fund aims to provide a return “by directly investing primarily in non-UK, fixed and floating rate securities issued by governments, public authorities and international organisations”. Currently, the Global Bond fund aims for “a more stable returns than typical investment in global equities” by investing in other collective investment schemes.

Henderson announced the third phase of its fund rationalisation in August, which included the proposed closure of the Henderson Japan Absolute Return fund.

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