By Elena Vardon
Henderson Diversified Income Trust and Henderson High Income Trust said that they have agreed to combine.
The London-listed trusts said Wednesday that if their respective shareholders and the regulator approved the proposed merger, it would be effected through a scheme of reconstruction with Henderson Diversified Income Trust, or HDIV, winding up.
The transaction would also include the transfer of part of HDIV's assets and undertaking to Henderson High Income Trust, or HHI, in exchange for the issue of new HHI shares or cash at a 1% discount, or both, they said.
The enlarged group would still be managed by Janus Henderson Investors UK, with David Smith as lead portfolio manager, they said.
"Those shareholders who roll will maintain a similar income profile, managed by the same investment group, but with the advantage of greater scale and liquidity," HDIV Chair Angus Macpherson said.
The proposals are expected to become effective in January, HHI said.
"The combination will increase the size of HHI, improve the liquidity and marketability in the company's shares and help to reduce the ongoing charges ratio by spreading costs across a larger shareholder base, which is in the interests of both existing and new shareholders," HHI Chairman Jeremy Rigg said.
At 0726 GMT, HDIV shares were up 4 pence, or 6.4%, at 66.6 pence, while HHI shares edged up 0.5 pence, or 0.3%, at 157.5 pence.
Write to Elena Vardon at [email protected]
Corrections & Amplifications
This article was corrected at 1142 GMT because the original incorrectly said HHI would be winding up and that part of its assets and undertakings would be transferred to HDIV. The combination of Henderson Diversified Income Trust and Henderson High Income Trust will lead to Henderson Diversified Income Trust winding up. The transaction would also include the transfer of part of HDIV's assets and undertaking to Henderson High Income Trust.