Changes to the Threadneedle Navigator Fund Range

We have identified considerable overlap between some of the Navigator Funds and similar funds in the Threadneedle Managed Funds range.

Following approval at the extraordinary general meetings (EGMs) on 14 February 2018, the assets of the Navigator Funds listed below will be merged into other Threadneedle funds on 16 March 2018.

Navigator Fund Managed Fund
Threadneedle Navigator Adventurous Managed TrustintoThreadneedle Managed Equity Fund
Threadneedle Navigator Balanced Managed TrustintoThreadneedle Managed Equity and Bond Fund
Threadneedle Navigator Cautious Managed TrustintoThreadneedle Managed Bond Focused Fund
Threadneedle Navigator Growth Managed TrustintoThreadneedle Managed Equity Focused Fund

 

We want to assure you that the transfers will not affect the value of your investment and that you will be placed in a suitable alternative product from our existing range. There are, however, some changes resulting from the transfer. They include the following:

  1. Some differences to the descriptions of the investment policies of some of the funds. For instance, the Threadneedle Navigator Growth Managed Trust aims to achieve a total return by capital growth whilst the fund into which it merges (Threadneedle Managed Equity Focused Fund) aims to achieve a total return by capital growth and income. In practice, there is little difference between the way the two funds are invested and long-term returns have been broadly consistent.
  2. A change to the dates on which income is paid.
  3. Changes to the way certain fees are applied.
  4. Some differences in the Synthetic Risk and Reward Indicator (SRRI) between the Navigator Funds and Managed Funds. The Managed Funds have either an equal or lower SRRI than the Navigator Funds. For those with a lower SRRI, your assets will be transferred into a product which has historically possessed slightly lower levels of risk.

Full details of the differences between the Navigator Funds and the Managed Funds can be found in Section 2 and Appendix 1 of the Unitholder Circular.

By merging the Navigator Funds into the Managed Funds we expect that Unitholders will pay lower fees than is currently the case. The mergers will also help to simplify our fund range and reduce the overlap between our products.

If your investment in the Navigator Funds is held in an ISA, please note that your ISA status will be unaffected by the transfer to the Managed Funds.

We consider the changes to be in the best interests of all investors. Please note that Columbia Threadneedle Investments will bear all the administration costs relating to the mergers.

Please refer to the Q&A for any questions you may have regarding the proposal.

The mergers were approved at EGMs held on 14 February 2018. If you do not wish for your investment to be transferred to the Managed Funds, then you have the following options:

  1. Switch your investment free of charge into another Threadneedle fund(s).
  2. Transfer your ISA investment to another ISA manager. To do so, you will need to complete an ISA transfer form and send it to your new ISA manager, who will then contact us to complete the transfer. Please note ISA transfers can take up to 30 days.
  3. Sell your units in the Navigator funds and receive the proceeds in cash. Please be aware that if you choose this option and your units are held in an ISA, then you will lose your ISA protection and there may also be tax implications depending on your individual circumstances.

We have decided to close the following funds on 22 March 2018:

  • Threadneedle Navigator Growth Trust
  • Threadneedle Navigator Income Trust
  • Threadneedle Navigator UK Index Tracker Trust

The Threadneedle Navigator Growth Trust and the Threadneedle Navigator Income Trust have fallen in size to a level which makes them economically unviable to run and we have identified that they are unlikely to attract new investors in the future. We are also aware of further planned redemptions from the Navigator Income Trust which would reduce its size further.

The Threadneedle Navigator UK Index Tracker Trust is an index tracking fund and there are no plans to develop our range of index tracking products.

We have considered alternatives to closing the Funds, but do not believe that alternative options are appropriate or in the best interests of investors.

Dealing in the Funds will be suspended from 12 noon on 21 March 2018, and the termination process will begin on 22 March 2018.

Action required

Ahead of the closures, your clients have the following options:

  1. You can switch your investment free of charge into another Threadneedle fund(s) up until 12 noon on 21 March 2018. Details of our funds can be found on the website: www.columbiathreadneedle.com. Before you switch funds, it is important that you read the Key Investor Information Document (KIID) for the fund(s) you wish to switch to. To switch to another Threadneedle fund(s), please complete and return the Form of Direction in the enclosed pre-paid envelope by 12 noon on 21 March 2018. 
  2. You can sell your investment before the Funds are suspended. To sell your units, please complete and return the Form(s) of Direction in the enclosed pre-paid envelope by 12 noon on 21 March 2018. 
  3. You can take no action and your units will be redeemed and the proceeds sent to you.

Please note, we must receive your Form of Direction to switch before 12 noon on 21 March 2018 in order to switch your units before the Funds are suspended. Instructions to switch on completion of the termination process will not be accepted after 12 noon on 21 March 2018 and we will redeem your holdings and send the proceeds to you instead.

If you are unclear about which option to choose, please speak to a financial adviser. If we do not receive your Form(s) of Direction by 12 noon on 21 March 2018, we will cash in your investment on 22 March 2018 and send the proceeds to you as soon as possible after the end of the termination process (we expect this to take approximately one month).

Additional information for ISA investors

If you want to keep your investment in an ISA, you have the following options:

  1. Switch your investment free of charge into another Threadneedle fund(s) before 12 noon on 21 March 2018.
  2. Transfer your ISA investment to another ISA manager. To do so, you will need to complete an ISA transfer form and send it to your new ISA manager, who will then contact us to complete the transfer. Please note ISA transfers can take up to 30 days.

If you choose to sell your investment or do not take any action your investment will be cashed in when the Funds are closed, and your investment will lose its ISA status.

Please refer to the Q&A for any questions you may have regarding the proposal.

FURTHER INFORMATION

If you are unsure about the implications for your investment and the action you should take, please contact your financial adviser. If you do not have a financial adviser, you can find one in your area by visiting www.unbiased.co.uk – please note that we do not endorse this site or the advisers found on it.

If you are unclear about any of the details relating to this proposal, or have any further questions, please call us on 0800 953 0134*. Our team is available from 8.00am to 6.00pm UK time, Monday to Friday.