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Results of ballot voting procedures in respect of the amendment of the investment policy of the SYG4IR ETF
Sygnia Itrix (RF) (Proprietary) Limited
Sygnia Itrix 4th Industrial Revolution Global Equity ETF
JSE Code: SYG4IR
ISIN: ZAE000252433
Portfolios in the Sygnia Itrix Collective Investment Scheme registered as such in terms of the
Collective Investment Schemes Control Act, 45 of 2002, managed by Sygnia Itrix (RF)
Proprietary Limited (Sygnia Itrix).
Results of ballot voting procedures in respect of the amendment of the investment
policy of the Sygnia Itrix 4th Industrial Revolution Global Equity ETF
Investors are referred to the announcement released on SENS on 29 April 2024 regarding
the ballot voting procedures in respect of the amendment of the investment policy of the
Sygnia Itrix 4th Industrial Revolution Global Equity ETF (the Portfolio) and are advised that
the audited results of the voting ballot procedures were as follows:
Total shares Total Total Responses Responses
responses responses in favour against
not received
received
Number of shares 41,306,277 34,988,351 6,317,926 6,280,229 37,697
% of total shares 100% 84.70% 15.30% 15.20% 0.10%
Less than 25% of the total number of participatory investors in the portfolio responded to the
first ballot request, therefore the ballot voting procedure was not successful and a second
ballot voting procedure will be conducted as set out below.
Second ballot voting procedure in respect of the amendment of the Sygnia Itrix 4th
Industrial Revolution Global Equity ETF (SYG4IR)
Sygnia Itrix (RF) (Pty) Limited is regulated by the Financial Sector Conduct Authority. In
terms of Section 98(2) of the Collective Investment Schemes Control Act of 2002 and clause
59.3 of the Main Deed of the Scheme, which stipulates that if investors holding less than
25% in value of the total number of participatory interests in a portfolio responded to the first
ballot in accordance with clause with clause 59.1 of the Main Deed (as is the case with the
first ballot that was conducted), then a second ballot must be conducted where only the
majority result of those investors who have responded, will determine whether the
amendment will be successful or not i.e. 25% quorum is not required (Clause 59.3 of Main
Deed).
Action required:
1. Investors are requested to notify their JSE Brokers/CSDPs in writing by no later than
Monday, 8 July 2024, as to whether they approve the amendment as set out in this
announcement or not;
2. If you have disposed of your participatory interests in the portfolio, no action is
required.
Background:
Sygnia Itrix (RF) (Pty) Ltd, a Manager appointed in terms of the Collective Investment
Schemes Control Act, No. 45 of 2022 (the Act), hereby effects 2nd ballot voting procedures in
terms of Section 59 of the Deed and Section 98 of the Act to obtain approval for:
• An amendment of the investment policy of the Sygnia Itrix 4th Industrial Revolution
Global Equity ETF (SYG4IR) changing the fund from a passively managed exchange
traded fund (ETF) to an actively managed ETF.
Motivation for the proposed change:
The motivation for changing the Sygnia Itrix 4th Industrial Revolution Global Equity ETF to
an actively managed ETF is to allow the fund to be repositioned to benefit from changing
economic environments. The current Kensho New Economies Index is based on a complex
rule based weighting algorithm that results in small and unprofitable companies being
overrepresented in the index and these companies tend to cyclically underperform in times
of high interest rates. Changing the fund to an actively managed ETF means Sygnia would
have more flexibility to vary the weights to companies across economic cycles. The fund
retains its focus on global companies optimally positioned to benefit from new technologies
and innovations that have the potential to transform the global economy across a broad
range of sectors.
Impact on Investors:
We believe that the impact of the proposed changes will be to the benefit of investors as the
portfolio manager will have more flexibility in selecting investments in new technologies and
innovations, as well as the weighting of these investments in the portfolio. As the current
index construction has resulted in small and unprofitable companies being overrepresented
in the index, by allowing active management, the portfolio manager will be able to have
discretion in removing these from the portfolio when optimal to do so. The manager, through
a number of mechanisms including portfolio construction and efficient portfolio management,
will aim to improve the return / risk ratio relative to the benchmark.
Important information to note:
1. The JSE code and ISIN of the fund will remain the same; and
2. The management fee will remain the same.
Please refer to the below summary indicating the changes before and after the investment
policy change.
List of similarities and differences before and after the proposed changes:
Before After
JSE Code: SYG4IR SYG4IR
ISIN: ZAE000252433 ZAE000252433
Fund name: Sygnia Itrix 4th Industrial Revolution Sygnia Itrix 4th Industrial Revolution
Global Equity ETF Global Equity Actively Managed
ETF
Long name: SYG4IRGE S4IR ACTIVELYMANAGED ETF
Abbreviated SYG4IRGE S4IRAMETF
name:
Portfolio S&P Kensho New Economies Solactive GBS United States 500
benchmark: Composite Index Index
Investment The objective of this portfolio is to provide simple The portfolio will be an actively managed exchange
access to investors who wish to gain investment traded fund. The Sygnia Itrix 4th Industrial
policy:
exposure to new technologies by tracking the Revolution Global Equity Actively Managed ETF is
movements of the Kensho New Economies a Global-Equity-General portfolio which seeks to
Composite Index through investing in the deliver long term capital growth by investing in
physical index securities. The Kensho New financially sound equity securities, preference
Economies Composite Index comprehensively shares which generate capital growth, property
captures the 21st Century Sectors that are shares and property related assets in liquid form
propelling the 4th Industrial Revolution and listed internationally. The portfolio may invest in
fostering new industries that will transform every participatory interests and other forms of
facet of our lives. participation in portfolios of collective investment
The investment policy of the portfolio shall be to schemes, registered in South Africa and other
track the Index by buying securities that similar schemes operated in territories with a
substantially make up the Index at similar regulatory environment which is to the satisfaction
weighting as they are included in the Index. of the manager and trustee of a sufficient standard
Whenever the Index gets rebalanced by the index to provide investor protection at least equivalent to
provider, the Portfolio will purchase the constituent that in South Africa and which is consistent with the
securities that substantially make up the Index and portfolio's primary objective.
will sell the constituent securities which were
excluded from the Index and buy or sell the The portfolio may also invest in listed and unlisted
securities that remain in the Index, in order to financial instruments, including derivatives, in
ensure that the returns of the portfolio follows that accordance with the provisions of the Collective
of the index. A tracking error minimizing algorithm Investment Schemes Control Act and applicable
is used to determine the least number of legislation, as amended from time to time, in order
transactions required to keep the portfolio's to achieve the portfolio's investment objective. The
returns aligned as closely as practically and Manager may also include unlisted forward
feasibly possible to the Index's return while at the currency, interest rate, index and exchange rate
same time keeping the trading costs in the portfolio swap transactions for efficient portfolio
to a minimum. management. In selecting securities for the
portfolio, where possible, the manager shall seek
No securities will be bought for the sole purposes to sustain long-term capital growth.
of making a speculative profit by selling them at a
higher price later on unless this is for the purpose The portfolio will focus on selecting global
of tracking the Index. All purchase and sales of companies which have exposure to new
securities are done solely to ensure the Portfolio technologies and innovations which have the
holds securities that substantially make up the potential to transform the global economy across a
Index and minimizes the tracking error to the broad range of sectors. The underlying portfolio
Index. will be actively managed in terms of sector and
geographical allocation. The securities selection
The portfolio is passively managed, and aims to will be determined by reference to published
produce the same level of income as that indices associated with each sector, taking into
produced by the Index. As a further objective, the account risk. The manager shall have the
securities held by the portfolio shall be managed maximum flexibility to vary allocation between the
to generate income for the benefit of investors. various geographical markets and sector classes
to reflect changing economic and market
The composition of the Portfolio will be compared conditions. The portfolio's benchmark, for
to the composition of the Index on a daily basis, performance measurement purposes, will be the
taking into account any investment contributions or Solactive GBS United States 500 Index.
withdrawals to and from the Portfolio, the receipt
of any dividends for reinvestment, the effect of any The effective exposure of the portfolio invested
corporate actions and its impact on the outside of the Republic of South Africa will always
composition of the Portfolio relative to that of the be above 80%.
Index.
The portfolio also represents Sygnia's best
The portfolio shall also be entitled to employ such investment view on the optimal combination of
other investment techniques and instruments as securities required to achieve superior long-term
will most effectively give effect to the object and returns at a reasonable level of risk at any time.
investment policy of the portfolio, including the use The portfolio exploits the benefits of diversification
of depository receipts as well as listed and unlisted and will change its exposure to different securities
financial instruments, including derivatives, in and sectors on an active basis, based on prevailing
accordance with the provisions of the Act and market conditions.
applicable legislation as amended from time to
time. The Manager may also include unlisted The portfolio aims to achieve its investment
forward currency, interest rate, index and objectives whilst recognising that there will be
exchange rate swap transactions for efficient significant short-term volatility and aims to protect
portfolio management. capital over the medium to long term.
Investors can obtain participatory interests in the
Portfolio by acquiring participatory interests on the
secondary market or subscribing for participatory
interests in the portfolio. In order to achieve this
objective the manager may, subject to the Act and
this Supplemental Deed No 16 read together with
the Main Deed, create and issue or redeem and
cancel an unlimited number of participatory
interests in the portfolio.
The portfolio will not be managed according to
traditional methods of active management, which
involve the buying and selling of securities based
on economic, financial and market analysis and
investing judgment. Instead the investment
objective and style will be replication of the Index
returns. As a result the financial or other condition
of any company or entity included from time to time
in the Index will not result in the elimination of its
securities from the portfolio unless the securities of
such company or entity are removed from the
Index itself.
The portfolio will hold securities purely for the
economic rights and benefits attaching thereto,
and accordingly if a takeover bid is made for
shares of a company included in the Index, the
portfolio will not tender shares in respect thereof.
Securities held by the portfolio which are subject
to a takeover bid will only be surrendered if such
surrender is mandatory (and then only to the
extent of such mandatory surrender) in terms of
the applicable law or under the rules of a
regulatory authority or body having jurisdiction. If a
takeover bid results in a company no longer
qualifying for inclusion in the Index, any shares of
the company held by the portfolio after the
takeover bid will be disposed of by the portfolio,
and the proceeds will be applied in effecting the
appropriate adjustments to the portfolio.
To the extent necessary for the purposes of
achieving its investment policies, the portfolio may
hold assets in liquid form.
It is recorded that the portfolio's ability to replicate
the price and yield performance of the Index will
be affected by the costs and expenses incurred by
the portfolio.
To the extent that assets in the portfolio are
exposed to exchange rate risk, the Manager may
include listed and unlisted financial instruments for
the exclusive purpose of hedging exchange rate
risk subject to the conditions and limits stipulated
by the Act. The manager shall have the maximum
flexibility to vary allocation between the various
geographical markets and sector classes to reflect
changing economic and market conditions.
The portfolio may invest in participatory interests
and other forms of participation in portfolios of
collective investment schemes, whether listed on
an exchange or not, registered in South Africa and
other similar schemes operated in territories with a
regulatory environment which is to the satisfaction
of the manager and trustee of a sufficient standard
to provide investor protection at least equivalent to
that in South Africa and which is consistent with
the portfolio's primary objective.
Any material change to the investment policy of
the portfolio shall constitute an amendment of the
Deed, and shall be subject to the provisions of
clause 65 of the Deed, in which even investors
shall be given reasonable notice to enable them to
redeem their participatory interest prior to
implementation of the change.
Charges: Management Fees 0.50% excl VAT Management Fees 0.50% excl VAT
Distribution: June, December June, December
Rebalancing: March, June, September and Not applicable
December
ASISA Global Equity General Global Equity General
classification
JSE Sector Exchange Traded Fund Exchange Traded Fund
JSE Sub- Exchange Traded Fund Actively Managed Exchange Traded
sector Fund
How does the proposed changes impact your investment?
Please refer to the list of similarities and differences above summarising the changes.
If the ballot is successful and approved by the FSCA, the SYG4IR portfolio will be changed
from a passively managed ETF to an actively managed ETF. Refer to the list above for a
detailed description of the investment policy of the actively managed ETF. The investment
policy change will be achieved by means of a Name Change capital event that will settle
through STRATE. In other words, there will be no conversion ratio applicable as investors will
hold the same number of shares in the actively managed ETF as they held in the ETF.
Therefore, a rounding methodology and/or fractions will not apply.
There shall be no tax impact or change in investment value for investors as a result of the
investment policy change.
The investment policy change does not release the trustees, custodian or manager from any
responsibility to the investors.
Your rights as an investor:
All investors in the SYG4IR portfolio are given an opportunity to vote in favour of, or against,
the proposed investment policy change in terms of clause 98 of the Act.
An independent auditor will verify the outcome of the 2nd ballot.
Should you not be comfortable with the proposal in so far as they relate to the portfolio in
which you hold participatory interests, you may elect to redeem your participatory interests at
any time and withdraw your money at the prevailing price in the market, as defined in the Main
Deed, subject to that it is a discretionary investment. By electing to redeem or sell your
participatory interests, it will constitute a CGT event for which you will be liable to pay
CGT at your next income tax assessment.
If you choose not to withdraw your investment, the proposed changes as set out in this
announcement (to the extent that they are approved by investors) will automatically apply to
your investment.
Approval and commencements:
Subject to the 2nd ballot voting procedure being successful and approval by the FSCA, the
proposed amalgamation will come into effect from commencement of business on
Wednesday, 31 July 2024. Copies of the Sygnia Itrix 4th Industrial Revolution Global Equity
ETF Pricing Supplement, in English, may be obtained during normal business hours from the
office of Sygnia Itrix (RF) (Proprietary) Limited located at 7th Floor, The Foundry, Cardiff Street,
Greenpoint, 8001 and is available on the website: https://www.sygnia.co.za/our-funds.
Expected timeline for the implementation of the proposed change in the investment
policy:
Salient dates 2024
Record date (investor extract date) Friday, 31 May
Declaration date announcement of 1st ballot Friday, 7 June
results and 2nd ballot voting procedures
Last day for investors to respond to their Monday, 8 July
JSE brokers/CSDPs on whether they
approve the amendment or not (by 5pm)
Deadline for Auditors to submit the findings Friday, 12 July
report to Sygnia Itrix
FSCA issues approval letter Monday, 22 July
Finalisation SENS announcement Tuesday, 23 July
confirming the results of the ballot by 11:00
Last day to trade in the old name as an ETF Tuesday, 30 July
Ex-date (trading commences as an AMETF) Wednesday, 31 July
Record date Friday, 2 August
Settlement date Monday, 5 August
Note:
SYG4IR will carry over its trading and reference data history from the ETF to the AMETF.
Any changes to the expected dates above will be announced on SENS.
Index disclaimer:
The indices currently tracked by SYG4IR are products of S&P Dow Jones Indices LLC or its
affiliates ("SPDJI") and has been licensed for use by Sygnia Itrix. Standard & Poor's® and
S&P® are registered trademarks of Standard & Poor's Financial Services LLC ("S&P"); Dow
Jones® is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and
these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes
by Sygnia Itrix. The Fund is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones,
S&P, their respective affiliates and none of such parties make any representation regarding
the advisability of investing in such product(s) nor do they have any liability for any errors,
omissions, or interruptions of the Index.
Should you require any further information, please do not hesitate to contact our Client Contact
Centre on 0860 794 642.
07 June 2024
Manager
Sygnia Itrix (RF) (Proprietary) Limited
Trustee
The Standard Bank of South Africa Limited
JSE Sponsor
Vunani Sponsors
Date: 07-06-2024 12:00:00
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