JPMorgan Japanese Investment Trust PLC and JPMorgan Japan Small Cap Growth & Income PLC on Wednesday announced a tie-up.

The combination will create a trust with £1 billion of net assets with a ‘broad all-cap strategy to capture a compelling investment opportunity’.

The merger, which would be the latest in a slew of tie-ups between listed investment trusts this year, will see JSGI’s assets rolled into JFJ.

In exchange, JSGI investors will be issued new JFJ shares, but will also have the option to realise up to 25% of their investment in JSGI in cash.

‘The respective boards and JPMorgan believe that the outlook for Japanese equities remains compelling with a combination of improving economic fundamentals, structural transformation and corporate governance reforms. The new combined entity, JFJ, will represent a very attractive way to invest in this opportunity. The transaction would result in a company with net assets of up to approximately £1.0 billion,’ the duo said.

Alexa Henderson, chair of JPMorgan Japan Small Cap, said: ‘The board believes that the proposed combination will provide continuity of investment process and philosophy within a broader market opportunity. The proposed combination will provide a much larger investment trust with significantly lower costs for shareholders.’

JPMorgan Japanese Investment Trust shares rose 2.7% to 551.33 pence each on late Wednesday morning in London, giving it a market capitalisation of £795.1 million. JPMorgan Japan Small Cap Growth shares jumped 7.6% higher to 326.13 pence each, giving it a market cap of £162.4 million.

Copyright 2024 Alliance News Ltd. All Rights Reserved.