Announcement and notice of the termination and delisting of the fund

IMPORTANT: If you are in any doubt about this Announcement and Notice or as to the action you should take, you should consult your stockbroker, lawyer, accountant, tax adviser or other professional advisers.

If you have sold or transferred all your units in Principal FTSE ASEAN 40, you should hand this Announcement and Notice to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

The Singapore Exchange Securities Trading Limited (“SGX-ST”) takes no responsibility for accuracy of any statement or opinion expressed in this Announcement and Notice.

PRINCIPAL FTSE ASEAN 40 (the “Fund”)
(a Singapore unit trust authorised under
Section 286 of the Securities and Futures Act 2001 of Singapore)
(Stock Code: M62 and QS0)

Terms not defined in this Announcement and Notice shall have the same meanings as used in the prospectus of the Fund registered by the Monetary Authority of Singapore on 13 September 2024 (the “Prospectus”).

We, Principal Asset Management (S) Pte Ltd (the “Manager”), the manager of the Fund, wish to inform Unitholders of the termination of the Fund and delisting of the units in the Fund (“Units”).

A. Proposed termination of the Fund
Pursuant to Clause 34.3(A) of the trust deed constituting the Fund dated 6 September 2006, as amended, supplemented or restated from time to time (“Trust Deed”), the Fund may be terminated by the Manager in its absolute discretion by reasonable notice in writing to DBS Trustee Limited (the “Trustee”) if on the Accounting Date or any other date falling after a period of three calendar years from the date of the Principal Deed (i.e. 6 September 2006) if on such Accounting Date or other date the aggregate Net Asset Value of all the Units outstanding hereunder shall be less than US$40 million.

As at 30 October 2024, the aggregate Net Asset Value of the Fund stands at approximately US$8,201,675.16. The Net Asset Value of the Fund has declined in recent years and in view of the current and anticipated future lack of demand, the Manager does not expect the size of the Fund to grow substantially in the near future. Continuing to manage the Fund at this size will result in higher operating costs and will not provide a favourable return to the Unitholders. Therefore, the Manager is of the view that it is in the interests of Unitholders as a whole to terminate the Fund. Consequently, the Manager has decided to exercise its power under Clause 34.3(A) of the Trust Deed to terminate the Fund with effect from 21 March 2025 (the “Termination Date”).

The Manager has given written notice to the Trustee notifying the Trustee of its proposal to terminate the Fund pursuant to Clause 34.3(A) of the Trust Deed, and to seek the delisting of the Units from the SGX-ST.

As required under Clause 34.5 of the Trust Deed, no less than three months’ notice is hereby given to the Unitholders, notifying them of the proposed termination of the Fund

B.Proposed delisting of the Fund from the SGX-ST
An application to delist the Units from the SGX-ST was made to the SGX-ST on 24 October 2024, and the SGX-ST granted its approval-in-principle for the proposed delisting of the Units on 22 November 2024.

Pursuant to the approval-in-principle granted by the SGX-ST, the Manager hereby announces that the delisting of the Units is conditional upon the Manager’s submission of a written confirmation to the SGX-ST to the effect that:
(1) the proposed termination of the Fund and the delisting of the Units and the proposed timeline for the termination of the Fund and delisting of the Units are in accordance with the applicable laws, regulations and agreements governing the Fund;

(2) the Manager will notify Unitholders (as named in the depository register maintained by The Central Depository (Pte) Limited (“CDP”) for the Fund) in writing of the termination of the Fund and the delisting of the Units promptly upon the publication of this Announcement and Notice on the Singapore Exchange Network (“SGXNET”);

(3) the costs and expenses associated with the termination of the Fund and the delisting of the Units (other than any Duties and Charges and any expenses and taxes payable, arising on the anticipated sale of the remaining investments comprised in the Fund and the Provision (as defined below)) will be fully borne by the Manager and not by the Fund or the Unitholders;

(4) the designated market maker of the Fund (“DMM”) will stand ready to quote bid and ask prices prior to the suspension of the listing and quotation of the Fund to ensure that Unitholders are able to liquidate their positions in the Fund before the close of trading on the Last Trading Day (as defined below); and

(5) the Fund will be liquidated and the net cash proceeds derived from the realisation of the remaining investments comprised in the Fund as of the Last NAV Day (as defined below) will be made to the remaining Unitholders.

The above decision of the SGX-ST is not an indication of the merits of the proposed termination and delisting of the Fund from the Official List of the SGX-ST.

The trading of the Units on the SGX-ST will cease with effect from close of trading on the SGX-ST on 6 March 2025 (the “Last Trading Day”) and the Units will be delisted from the SGX-ST on or around 11 April 2025 (the “Delisting Date”). Accordingly, investors may buy and sell Units on the SGX-ST in accordance with the usual trading arrangements, during the trading hours of the SGX-ST and based on the prevailing market prices, until close of trading on the Last Trading Day.

Applications for the creation of Units in the primary market will not be accepted with effect from 6 December 2024 except by the DMM solely for the purpose of market making activities to provide liquidity for the trading of the Units on the SGX-ST. Applications for the redemption of Units in the primary market, where applicable, may be made in accordance with the Prospectus until the Dealing Deadline on the Last Trading Day (being 12:00pm (Singapore time) on 6 March 2025). No further applications for the creation and redemption of Units in the primary market will be accepted after the Dealing Deadline on the Last Trading Day.

After the Last Trading Day, the Units will cease trading on the SGX-ST. Accordingly, no further buying or selling of Units on the SGX-ST will be possible after the Last Trading Day.

Please note that only Participating Dealers may purchase or redeem Units directly from the Fund at the Net Asset Value. All other investors may only purchase and sell Units on the SGX-ST or through a Participating Dealer, subject to such terms and conditions as may be imposed by the Participating Dealer.

C. Liquidation of investments of the Fund and distribution of proceeds
The Fund will be terminated on the Termination Date and the Manager will commence realisation of all the remaining investments comprised in the Fund in accordance with the Trust Deed from the Termination Date.

Subject to the Trust Deed, the liquidation proceeds will be distributed (the “Distribution”) among the Unitholders who hold Units as at 5:00pm (Singapore time) on 14 March 2025 (“Distribution Record Date”) (as recorded in the depository register maintained by the CDP) (the “Relevant Unitholders”), who shall be entitled to payment of the amount of Distribution in US$ in proportion to the Units held by them as at the Distribution Record Date. Such Distribution is expected to be paid on or around 4 April 2025 (“Distribution Date”).

Subject to the Trust Deed, the amount of Distribution will be equal to the value of net cash proceeds derived from the realisation of the remaining investments comprised in the Fund as of 26 March 2025 (“Last NAV Day”) (which exclude (i) any Duties and Charges and any expenses and taxes payable, arising on the anticipated sale of the remaining investments comprised in the Fund; and (ii) the sum to be retained by the Trustee as it determines to be full provision for all costs, charges, expenses, claims, demands, actions and proceedings incurred, made or instituted against or apprehended by the Trustee in connection with or arising out of the Fund (including but not limited to any fees payable to any service provider by the Fund, including the Manager) (the “Provision”)).

For a Relevant Unitholder who is subscribed to the CDP’s Direct Crediting Service (“DCS”), the Distribution will be credited directly into the Relevant Unitholder’s designated bank account via CDP’s DCS (or in such other manner as the Relevant Unitholder may have agreed with CDP for the payment of any cash distribution). The Currency Conversion Service (“CCY”) is automatically provided to a subscriber of the CDP’s DCS. Accordingly, the Distribution will be paid in S$ based on the currency exchange rate as may be determined by CDP in accordance with the CCY. To receive the Distribution in US$, the Relevant Unitholder must opt out of the CCY at least 3 business days before the Distribution Date.

For a Relevant Unitholder who is not subscribed to the CDP’s DCS, the Distribution will be credited directly into the Relevant Unitholder’s Cash Ledger in US$ and be subject to the same terms and conditions as Cash Distributions under the CDP Operation of Securities Account with the Depository Terms and Conditions (Cash Ledger and Cash Distributions as defined therein).

The Manager will publish a further announcement on SGXNET and notify the Relevant Unitholders in writing of the exact dates of the Distribution Date and Delisting Date as well as the amount of Distribution per Unit in respect of the Fund (the “Distribution Announcement and Notice”) before the Distribution Date.

After the payment of the Distribution to the Relevant Unitholders, the Manager does not expect or anticipate there will be a further distribution to any Relevant Unitholder. However, in the unlikely event there is a further distribution to any Relevant Unitholder, the Manager will publish a subsequent announcement on SGXNET and notify the Relevant Unitholders in writing accordingly.

D. Options for Unitholders
In view of the upcoming termination of the Fund and delisting of Units, Unitholders who purchased Units via the SGX-ST have the following options:

Option 1
From the date of this notice up to the Last Trading Day, Unitholders may continue to buy or sell its Units on the SGX-ST. The DMM shall stand ready to buy Units (during normal trading hours of the SGX-ST up to the Last Trading Day) from any Unitholder who wishes to sell such Units on the SGX-ST. Please note that the fees and charges payable when selling Units on the SGX-ST (including brokerage and clearing fees) will apply.

Option 2
Unitholders who have not sold their Units on the SGX-ST by the Last Trading Day will not be able to sell their Units on the SGX-ST. Unitholders who hold Units as at 5:00pm (Singapore time) on the Distribution Record Date will receive a Distribution in proportion to their holdings of Units, which will be paid out by the Distribution Date.

E. Indicative Timetable
The table below sets out the indicative timetable of the termination of the Fund and delisting of the Units from the SGX-ST:

 

Please note that the dates mentioned in this Announcement and Notice and in the indicative timetable are subject to change. The Manager will issue further announcements on SGXNET should there be any material change to the information provided herein.

F. Enquiries
If you have any questions concerning this Announcement and Notice, please contact us at +65 6031 0811 during normal office hours or via email at nicholas.yap@principal.com / jingxin.seng@principal.com.
 

Christopher Leow
Chief Executive Officer
For and on behalf of Principal Asset Management (S) Pte Ltd
6 December 2024