The Hindu Business Line : Alliance Cap fund to migrate to Birla MF early next year

Alliance Cap, currently on its way to bidding a final good-bye to the Indian market, had announced its deal with the Birla outfit in mid-October. It is now in the process of seeking unit-holders' approval even as an application for amending the Alliance MF Trust Deed is pending with the SEBI.

Alliance has sent a detailed note to investors listing the norms that should be followed with regard to voting.

While all unit-holders (as on October 31) are eligible to vote, only signed ballots received on or before the close of business on December 30 will be considered valid.

Valid ballots will be counted by CAMS, the transfer agent, in the presence of an independent third party and an Alliance representative.

If more than 50 per cent of the total votes are in favour, the proposal will be carried.

The Alliance note has further referred to its open-ended schemes, in which exit loads have been removed from November 22.

Unit-holders are now free to redeem their holdings without charge, provided lock-in provisions under Section 54 EB or Section 88 of the Income-Tax Act do not apply to them.

Further, investors who have pledged their units will not have the option to exit unless a release of their pledge is procured.

The Alliance move is aimed at transferring its right to manage the schemes to Birla MF, billed earlier as a larger mutual fund house growing at a faster rate.

Alliance, which began its foray into the Indian market with the introduction of the Luxembourg-registered India Liberalisation Fund, managed about Rs 2,000 crore as of end-September 2004. In comparison, Birla MF's assets added up to roughly Rs 9,000 crore.

Mr S.V. Prasad, CEO of Birla MF, said that the Alliance schemes will, at least for the time being, be managed under a somewhat different identity.

The idea is to create in the minds of investors a fit place for both Birla MF and Birla Sunlife MF. The Alliance schemes will be prefixed with the latter.

These schemes will be governed by the Birla MF Trust Deed, entered into between Birla Growth Fund Ltd (now Birla Global Finance) and Birla Capital International Ltd (now Birla Sun Life Asset Management).