Van Eck Global and Merrill Lynch & Co., a subsidiary of Bank of America Corporation ("Merrill Lynch"), have entered into an agreement relating to Merrill Lynch-sponsored HOLding Depository ReceiptS (“HOLDRS”). Van Eck’s Market Vectors ETF Trust plans to offer investors in six HOLDRS -- Oil Services (OIH), Semiconductor (SMH), Pharmaceutical (PPH), Biotech (BBH), Retail (RTH), and Regional Bank (RKH) -- the opportunity to exchange their shares in these funds for shares of new Market Vectors exchange-traded funds (ETFs). These HOLDRS had approximately $3.65 billion in aggregate assets and a combined 30-day average daily trading volume of approximately 20.07 million shares as of the close of trading on August 11, 2011. Terms of the transaction were not disclosed.
Van Eck’s proposed exchange offer is expected to allow participating investors the opportunity for uninterrupted exposure to target industries. The new ETFs are expected to retain the corresponding HOLDRS’ ticker symbols. Van Eck expects the exchange offer to be launched early in the fourth quarter of 2011 and the transaction to be consummated later in the fourth quarter of 2011. The exchange offer documents, which are expected to be filed with the Securities Exchange Commission (“SEC”) in September 2011, will contain information about the transaction including its mechanics and potential tax implications.
“As a leading provider of exchange-traded funds, Van Eck Global is an excellent partner for us on this transaction,” said Liam O’Neil, Head of Market Linked Solutions at Merrill Lynch.
The table below presents the six HOLDRS as well as ticker symbols, names and underlying indices of the soon-to-be-launched Market Vectors ETFs. (The table includes links to information about the underlying indices, including methodology and constituents.) The six new ETFs will be part of Van Eck’s family of Market Vectors ETFs. Upon the completion of Van Eck’s expected exchange offer, Merrill Lynch intends to delist the six HOLDRS included in the transaction and liquidate them thereafter.
|Ticker||HOLDRS||Market Vectors ETFs||Market Vectors Indices|
|HOLDRS/ETFs INCLUDED IN EXCHANGE OFFER:|
|OIH||Oil Services||Market Vectors Oil Services ETF||Market Vectors US Listed Oil Services 25 Index (MVOIHTR)|
|SMH||Semiconductor||Market VectorsSemiconductor ETF||Market Vectors US Listed Semiconductor 25 Index (MVSMHTR)|
|PPH||Pharmaceutical||Market VectorsPharmaceutical ETF||Market Vectors US Listed Pharmaceutical 25 Index (MVPPHTR)|
|BBH||Biotech||Market Vectors Biotech ETF||Market Vectors US Listed Biotech 25 Index (MVBBHTR)|
|RTH||Retail||Market Vectors Retail ETF||Market Vectors US Listed Retail 25 Index (MVRTHTR)|
|RKH||Regional Bank||Market VectorsMoney-Center Bank ETF||Market Vectors US Listed Money-Centre Bank 25 Index (MVRKHTR)|
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