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Wednesday, May 27, 2020

Franklin Templeton MF: Vote for assets disposal

On May 7, Sebi asked Templeton to focus on returning money to investors “as soon as possible”.

Written by George Mathew | Mumbai | Published: May 16, 2020 12:44:12 am
Franklin Templeton, Franklin Templeton mutual fund, Franklin Templeton crisis. Franklin Templeton fraud, Franklin Templeton asset disposal The troubled fund house closed six of its debt schemes with assets under management totalling Rs 28,000 crore. (Photo: Noah Berger/Bloomberg News)

After unilaterally and abruptly winding up six credit risk schemes with a corpus of Rs 28,000 crore, Franklin Templeton has informed investors that they will have to participate in a “voting process” to authorise the Trustees of the mutual fund to proceed with the disposal of the assets of the schemes.

On May 7, Sebi asked Templeton to focus on returning money to investors “as soon as possible”. In an ultimatum to the investors, the fund house said, “If Trustees do not receive authorisation to proceed with disposal of assets of the scheme, this may delay the process of monetizing such assets and distribution of proceeds.”

“An investor in one or more schemes will be required to vote separately for each scheme they hold investments in. I would also like to clear some misconceptions regarding the purpose of the voting exercise. Some investors believe that by voting in the ‘Negative’, the winding up will be reversed and that the six schemes will recommence the redemption and subscription process. This is not true,” Sanjay Sapre, president, Franklin Templeton Asset Management said to investors.

“The purpose is to authorise trustees to take next steps for disposal of the assets of the scheme and distribution of the proceeds to the unitholders in accordance with regulations,” it says.

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