First Trust Advisors L.P. ("FTA") announced today that the Board of Trustees of First Trust RiverFront Dynamic Asia Pacific ETF (Nasdaq: RFAP), an actively managed exchange-traded fund ("ETF") managed by FTA and sub-advised by RiverFront Investment Group LLC ("RiverFront"), approved the reorganization of RFAP into First Trust RiverFront Dynamic Developed International ETF (Nasdaq: RFDI), another actively managed ETF managed by FTA and sub-advised by RiverFront. The reorganization has also been approved by the Board of Trustees of RFDI. RFDI will be the surviving fund.
Under the terms of the proposed transaction, which is expected to be tax‑free, the assets of RFAP would be transferred to, and the liabilities of RFAP would be assumed by, RFDI, and shareholders of RFAP would receive shares of RFDI with a net asset value equal to the aggregate net asset value of the RFAP shares held by them. It is currently expected that the transaction will be consummated no later than the third quarter of 2021, subject to satisfaction of applicable regulatory requirements and approvals and customary closing conditions. More information on the proposed transaction will be contained in an information statement that will be filed with the SEC in the coming weeks. Upon completion of the proposed transaction, the investment objective and strategies of RFDI will remain unchanged.
RFAP is an actively managed ETF that seeks to provide capital appreciation. Under normal market conditions, RFAP pursues this investment objective by investing at least 80% of its net assets (including investment borrowings) in a portfolio of equity securities of "Asian Pacific companies" through investments in common stock, depositary receipts, and common and preferred shares of real estate investments trusts ("REITs"), and forward foreign currency exchange contracts and currency spot transactions used to hedge RFAP’s exposure to the currencies in which the equity securities of such Asian Pacific companies are denominated. Asian Pacific countries include the countries located in Asia and the Pacific Islands as well as Australia and New Zealand. RFAP generally focuses its Asian Pacific company investments in Australia, Hong Kong, Japan, New Zealand and/or Singapore. The securities in which RFAP may invest must be listed on a U.S. or non-U.S. securities exchange. RFAP may invest in small, mid and large capitalization companies.
RFDI is an actively managed ETF that seeks to provide capital appreciation. Under normal market conditions, RFDI pursues this investment objective by investing at least 80% of its net assets (including investment borrowings) in a portfolio of equity securities of developed market companies, including through investments in common stock, depositary receipts and common and preferred shares of REITs, and forward foreign currency exchange contracts and currency spot transactions used to hedge RFDI’s exposure to the currencies in which the equity securities of such developed market companies are denominated. Developed market countries currently include the countries comprising the Morgan Stanley Capital International World Index or countries considered to be developed by the World Bank, the International Finance Corporation or the United Nations. Under normal market conditions, RFDI will invest in at least three countries and at least 40% of its net assets in countries other than the United States. The securities in which RFDI may invest must be listed on a U.S. or non-U.S. securities exchange. RFDI may invest in small, mid and large capitalization companies.
FTA is a federally registered investment advisor and serves as the investment advisor of RFAP and RFDI. FTA and its affiliate First Trust Portfolios L.P. ("FTP"), a FINRA registered broker-dealer, are privately-held companies that provide a variety of investment services. FTA has collective assets under management or supervision of approximately $171.578 billion as of December 31, 2020 through unit investment trusts, exchange-traded funds, closed-end funds, mutual funds and separately managed accounts. FTA is the supervisor of the First Trust unit investment trusts, while FTP is the sponsor. FTP is also a distributor of mutual fund shares and exchange-traded fund creation units. FTA and FTP are based in Wheaton, Illinois.
RiverFront Investment Group LLC is a global asset manager utilizing a strategic and tactical investment approach with uncommon transparency and serves as the sub-advisor of RFAP and RFDI. RiverFront is a registered investment advisor whose employees maintain majority ownership. The team averages 20 years in the investment industry with an emphasis on relationships with retail clients and advisors.
Additional Information about the Proposed Reorganization and Where to Find It
This press release is not intended to, and shall not, constitute an offer to purchase or sell shares of RFAP or RFDI. This press release references an information statement, to be filed by RFDI. This information statement has yet to be filed with the SEC.
Investors and security holders of RFAP are urged to read the information statement and other documents filed with the SEC carefully in their entirety when they become available because they will contain important information about the proposed reorganization. Investors should consider the investment objectives, risks, charges and expenses of RFAP and RFDI carefully. The information statement will contain information with respect to the investment objectives, risks, charges and expenses of the funds and other important information about RFAP and RFDI. The information statement will constitute neither an offer to sell securities, nor will it constitute a solicitation of an offer to buy securities, in any state where such offer or sale is not permitted.
Investors may obtain free copies of the information statement and other documents (when they become available) filed with the SEC at the SEC’s web site at www.sec.gov. In addition, free copies of the information statement and other documents filed with the SEC may also be obtained after the information statement is filed by calling FTA toll-free at (800) 621-1675.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA and the Internal Revenue Code. First Trust has no knowledge of and has not been provided any information regarding any investor. Financial advisors must determine whether particular investments are appropriate for their clients. First Trust believes the financial advisor is a fiduciary, is capable of evaluating investment risks independently and is responsible for exercising independent judgment with respect to its retirement plan clients.
Forward Looking Statements
Certain statements made in this press release that are not historical facts are referred to as "forward‑looking statements" under the U.S. federal securities laws. Actual future results or occurrences may differ significantly from those anticipated in any forward‑looking statements due to numerous factors. Generally, the words "believe," "expect," "intend," "estimate," "anticipate," "project," "will" and similar expressions identify forward‑looking statements, which generally are not historical in nature. Forward‑looking statements are subject to certain risks and uncertainties that could cause actual results to differ from those anticipated in any forward-looking statements. You should not place undue reliance on forward‑looking statements, which speak only as of the date they are made. FTA, FTP, RiverFront, RFAP and RFDI undertake no responsibility to update publicly or revise any forward‑looking statements.
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