SEBI is expected to give product restructuring approval shortly after which investors will be given a no load exit window.
SEBI has issued a no objection certificate (NOC) on the change of ownership of Fidelity AMC a few days back. SEBI is expected to give its go ahead for restructuring the two entities products shortly. Once the product approval comes, investors will be given an option to exit without load.
“We are pleased to announce that SEBI has confirmed that it has no objection to the change in control of the Fidelity India AMC,” said a Fidelity spokesperson.
Both fund houses will merge their schemes which have common objectives. L&T has eight equity schemes, two hybrid and seven debt funds while Fidelity runs 15 schemes. L&T MF has a predominant debt book while Fidelity has focussed on equity assets. Both, L&T and Fidelity have a common registrar — CAMS.
L&T MF will absorb Fidelity’s sales, marketing and fixed income team.
The combined entity’s assets under management stood at Rs 10424 crore as on June 2012 which could take L&T MF to 15th rank in the 44 players industry. The key challenge for L&T will be to retain its newly acquired assets and put up a good fund performance to win investors and distributors confidence.
L&T MF entered the MF industry by acquiring DBS Cholamandalam in 2010 and picked up a 100% stake in Fidelity in March 2012. Fidelity had set up its Indian mutual fund business in 2004.
