Article

Announcement of Consolidation Proposals

14 December 2023
Invesco

Announcement of Consolidation Proposals

The Board of Invesco Select Trust Plc (the “Company”) has undertaken a review of the Company and its strategy, with the objective of broadening the appeal of the Company as well as improving liquidity and narrowing the discount at which the Company’s shares trade. Consequently, the Board intends to put forward proposals to the Company’s shareholders (“Shareholders”) to simplify the Company’s corporate structure and to introduce certain features that it believes will appeal to a broad investor base (the “Proposals”).

Background

The Company was launched in 2006 with a multi-share class structure to enable Shareholders to invest in a wide array of asset classes and to rebalance their portfolio by allowing them to convert, tax-efficiently between share classes. However, in recent years, the Company has seen a limited take-up of the conversion opportunities between the existing four share classes: 

  • Global Equity Income (“Global Share Class”)
  • UK Equity (“UK Share Class”)
  • Balanced Risk Allocation (“Balanced Risk Class”)
  • Managed Liquidity (“Managed Liquidity Class”)

With demand from investors for larger, more liquid investment vehicles, the Board believes it could be increasingly challenging to market separately the Global Share Class and the UK Share Class in their current form, with the structure potentially presenting an additional hurdle for those looking to invest.

The Proposals

The Board believes that the Global universe offers the broadest set of investment opportunities for equity investors whilst also providing diversification benefits for UK investors. Accordingly, the Board has concluded that it would be in the best interests of shareholders as a whole to consolidate the UK Share Class and the Smaller Share Classes (the Balanced Risk and Managed Liquidity Share Classes) into the Global Share Class (the “Consolidation”).

Download document to learn more about Invesco Select Trust Plc’s restructuring proposals.

Discover the full range of Investment Trusts

Investment risks

  • Investment risks

    The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.

    The use of borrowings may increase the volatility of the NAV and may reduce returns when asset values fall.

    The Invesco Select Trust plc uses derivatives for efficient portfolio management which may result in increased volatility in the NAV. In addition, some companies are suspending, lowering or postponing their dividend payments, which may affect the income received by the product during this period and in the future.

    The Invesco Select Trust plc Global Equity Income Share Portfolio invests in emerging and developing markets, where difficulties in relation to market liquidity, dealing, settlement and custody problems could arise. The Invesco Select Trust plc UK Equity Share Portfolio invests in smaller companies which may result in a higher level of risk than a product that invests in larger companies. Securities of smaller companies may be subject to abrupt price movements and may be less liquid, which may mean they are not easy to buy or sell.

    In the Invesco Select Trust plc Balanced Risk Allocation Share Portfolio, fixed income securities may not always make interest and other payments, nor is the solvency of the issuers guaranteed. Market conditions, such as a decrease in market liquidity, may mean that the product may not be able to sell those securities at their true value. The product has exposure to commodities, which are generally considered to be high-risk investments and may result in large fluctuations in the NAV. The product makes significant use of derivatives for investment purposes, which may result in the product being significantly leveraged and may result in large fluctuations in the NAV.

Important information

  • All information correct as at 14 December 2023 unless otherwise stated.

    Current tax levels and reliefs may change. Depending on individual circumstances, this may affect investment returns. If investors are unsure if this product is suitable for them, they should seek advice from a financial adviser.

    This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.

    Views and opinions are based on current market conditions and are subject to change.

    For more information on our products, please refer to the relevant Key Information Document (KID), Alternative Investment Fund Managers Directive document (AIFMD), and the latest Annual or Half-Yearly Financial Reports. This information is available on the website.

    Further details of the Company’s Investment Policy and Risk and Investment Limits can be found in the Report of the Directors contained within the Company’s Annual Financial Report.