LIC Mutual Fund to acquire IDBI Mutual Fund schemes

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LIC Mutual Fund to acquire IDBI Mutual Fund schemes

LIC Mutual Fund (LICMF) has unveiled its plans to acquire the schemes of IDBI Mutual Fund (IDBIMF), signaling a significant development in the mutual fund industry. In a letter sent to all unitholders of IDBIMF schemes, the company outlined the proposed changes in sponsorship, trusteeship, management, and administration that would accompany the acquisition. Complying with regulations, IDBIMF has also provided unitholders with the option to exit their investments without incurring any exit load.

Among the 20 schemes currently offered by IDBIMF, 10 will be merged with LICMF schemes in corresponding categories. For instance, the IDBI Equity Advantage Fund, an Equity Linked Savings Scheme (ELSS), will be integrated into the LICMF Tax Plan. This merger encompasses five equity funds, one hybrid fund, and several debt products. The remaining 10 schemes will be transferred to LICMF and rebranded. This set comprises two gold investment schemes, one hybrid fund, and the remaining equity schemes.

According to the agreement between the two fund houses, LICMF will assume responsibility for managing, operating, and administering all of IDBIMF’s schemes moving forward. To ensure transparency and obtain unitholder approval, IDBIMF has issued a ballot form. The voting period commences on June 20, 2023, and concludes on July 19, 2023 (inclusive). Valid and properly filled-out ballot papers received by the Registrar, as well as electronically submitted votes during this duration, will be considered in determining the ballot results. Each unitholder will have one vote per unit held.

As the merger and transfer of IDBIMF schemes, along with the change of the asset management company (AMC), entail fundamental attribute modifications, unitholders are granted the opportunity to exit their investments until July 19, 2023, without incurring any exit load. However, exercising this option is not obligatory, and unitholders may choose to remain invested if they are satisfied with the proposed changes.

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IDBIMF will communicate the date of the scheme mergers and transfers to unitholders following the conclusion of the exit window period and voting process.

As of May 31, 2023, LICMF managed assets valued at Rs 18,719 crore, while IDBI MF had assets worth Rs 3,805 crore, according to Value Research.

About LIC Mutual Fund:

LIC Mutual Fund was founded on April 20th, 1989, by LIC of India. As a subsidiary of India’s leading and most reputable brand, LIC Mutual Fund is a prominent player in the field of asset management. With a strong commitment to disciplined investment practices and a high level of financial ethics and corporate governance, LIC Mutual Fund is becoming a favored choice among investors.

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