ICICI Pru mutual fund has introduced that its board and the trustees have accredited the merger of 5 Fixed Maturity Plans (FMPs), into ICICI Prudential Money Market Fund.
The merging schemes are ICICI Prudential FMP Series 84 – 1272 Days Plan Q, ICICI Prudential FMP Series 84 – 1279 Days Plan P, ICICI Prudential FMP Series 84 – 1288 Days Plan O, ICICI Prudential FMP Series 84 – 1254 Days Plan U and ICICI Prudential FMP Series 84 – 1247 Days Plan W.
The efficient date of the merger would be the maturity date of every FMP, which is both May 30, 2022 or June 2/9, 2022.
Investors who agree with the merger proposal ought to give a consent type to the fund home. The consent interval is open for one month ranging from April 29, 2022 until the maturity of the fund.
Unitholders who don’t submit the consent type might be deemed as not in settlement with the merger and can obtain the redemption proceeds on the maturity date of the FMP. The maturity proceeds will entice the capital good points tax.
Note that there might be no influence on the investments of current buyers within the ICICI Pru Money Market Fund. However, the present buyers on this fund are additionally given an choice to exit, with none exit load, throughout the exit possibility interval ranging from April 29, 2022 until June 09, 2022 at relevant NAV.
The 5 FMPs at the moment have vital publicity to AAA-rated company bonds and sovereign securities. On the opposite hand, the cash market fund that the FMPs will get merged into has good publicity to cash market devices equivalent to business papers and certificates of deposit.
“In that case, there might be no main distinction on the credit score publicity entrance between current FMPs and the cash market fund,” stated Joydeep Sen, an impartial debt market analyst. He additionally identified that buyers who will not be in want of rapid money requirement may give their consent to the merger due to the tax advantages on the merger.
As per the Income Tax Act, consolidation of schemes of mutual funds doesn’t set off tax implications. Thus, if funds are invested within the new scheme on the merger, there might be no capital good points influence on the investor now.