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Ballot Voting Procedure - Proposed Amalgamation of the STXHLT ETF with the STXESG
SATRIX MANAGERS (RF) PTY LTD
SATRIX HEALTHCARE INNOVATION FEEDER ETF
SHARE CODE: STXHLT
ISIN: ZAE000310496
A portfolio in the Satrix Collective Investment Scheme in Securities,
registered as such in terms of the Collective Investment Schemes Control
Act, 45 of 2002
Ballot Voting Procedure - Proposed Amalgamation of the Satrix Healthcare
Innovation Feeder ETF with the Satrix MSCI World ESG Enhanced Feeder
ETF
This letter is important and requires your immediate attention.
The purpose of this letter is to inform you of the proposed
amalgamation of the Satrix Healthcare Innovation Feeder ETF (source
portfolio) with the Satrix MSCI World ESG Enhanced Feeder ETF (targeted
portfolio) and to provide you with sufficient information to vote on
this proposal – including your rights as an investor and the impact
this will have on your investment.
In terms of Section 99 of the Collective Investment Schemes Control
Act, 45 of 2002 ("the Act"), the proposed amalgamation will proceed
if the majority of investors vote in favour of the amalgamation by
way of the enclosed ballot. Absence of a response will be regarded as
a vote in favour of the amalgamation.
The amalgamation ballot is conducted at the request of Satrix Managers
(RF) (Pty) Ltd ("Satrix"), FSP 15658, the manager of the Satrix
Collective investment Scheme in Securities.
Reason for the Proposed Amalgamation
This proposal seeks to amalgamate the Satrix Healthcare Innovation
Feeder ETF into the Satrix MSCI World ESG Enhanced Feeder Portfolio.
The objective is to streamline the product offering, improve cost
efficiency, and enhance investor outcomes by consolidating assets into
a fund with broader diversification, deeper ESG integration, and more
consistent global exposure while moving away from a one-sector focus
ETF.
Both these ETFs are thematically driven, with the Healthcare
Innovation Feeder ETF focusing on long-term medical, biotech, and
health-tech innovation while the World ESG Enhanced Portfolio focuses
on environmental, social, and governance (ESG) performance and
improved sustainability profiles. Both these funds go through ESG
screening, with both typically excluding companies involved in
controversial weapons, tobacco, or those violating UN Global Compact
principles.
Feature Satrix Healthcare Satrix World ESG
Innovation ETF Enhanced ETF
Basic ESG exclusions Yes Yes
UN Global Compact screen Yes Yes
Exclusion of controversial Limited Broad
sectors
Uses ESG data from top provider (STOXX + (MSCI ESG
Sustainalytics/MSCI) Research)
Risk and Return on Past Performance
The chart below illustrates the historical drawdowns of the indices
that are tracked by these two ETFs (in Rand terms)
Figure 1 - Drawdowns of the indices tracked by the two ETFs, in ZAR
– to end of May 2025. Source: Bloomberg, Satrix
The chart above illustrates the historical drawdowns of the indices
tracked by the Healthcare Innovation ETF compared to the World ESG
Enhanced ETF from 2013 to April 2025. It is evident that the Healthcare
ETF has experienced significantly deeper and more frequent drawdowns,
with declines close to -30% at times, particularly during periods of
market stress. In contrast, the World ESG Enhanced ETF has displayed
greater resilience and more stable performance, consistently avoiding
extreme downturns.
The chart below shows the cumulative performance of the two indices
tracked by these ETFs, in ZAR terms also showing the higher volatility
in the Healthcare index compared to the more stable World ESG Enhanced
index.
Figure 2: Total returns of the indices tracked by the two ETFs, in ZAR
– to end of May 2025. Source: Bloomberg, Satrix
This volatility differential reinforces the case for amalgamation: by
transitioning into the more diversified and balanced ESG Enhanced ETF,
investors can benefit from smoother return profiles, reduced downside
risk, and improved long-term capital preservation, without completely
forgoing exposure to the healthcare sector
Overlapping Objectives and ESG Scoring
While the Satrix Healthcare Innovation Feeder ETF focuses on a specific
sector, both ETFs apply baseline ESG exclusions. The Satrix World ESG
Enhanced Feeder Portfolio applies a more comprehensive ESG framework,
offering exposure to a wide range of industries and companies with
superior ESG scores. By merging into the ESG Enhanced ETF, investors
retain exposure to high-quality healthcare companies (as part of the
MSCI World universe) while benefiting from a broader ESG strategy.
Improved Diversification
The Satrix Healthcare Innovation Feeder ETF is concentrated in a niche
sector, which exposes investors to higher volatility and sector-
specific risks. In contrast, the ESG Enhanced Feeder Portfolio is well-
diversified across sectors, regions, and ESG factors, reducing
concentration risk and enhancing long-term stability.
Cost Efficiency and Scale
Consolidating the assets under the larger and more scalable Satrix
World ESG Enhanced Feeder Portfolio allows for improved cost
efficiencies, both in terms of TER and operational management.
Investors benefit from a lower-cost structure and enhanced liquidity.
ESG Momentum and Global Trends
There is growing regulatory and investor demand for ESG-aligned
investment strategies. The Satrix World ESG Enhanced Feeder Portfolio
is positioned to benefit from this momentum and already meets evolving
expectations for ESG integration, carbon screening, and ESG score
optimisation. Moving assets into this fund better aligns with future-
focused investor preferences.
Differences in Investment Policies
The table below lists the investment policies of both ETFs:
Satrix Healthcare Innovation Satrix MSCI World ESG Changes and
Feeder ETF Enhanced Feeder ETF impact
Investment Policy Investment Policy
The objective is
3.1 The objective of the 3.1 The objective of the to streamline
Satrix Healthcare Innovation Satrix MSCI World ESG the product
Feeder ETF is to provide an Enhanced Feeder Portfolio is offering,
investment vehicle for to provide an investment improve cost
investors wishing to track vehicle for investors wishing efficiency, and
the performance of the STOXX to track the MSCI World ESG enhance investor
Global Breakthrough Enhanced Focus NET Index outcomes by
as closely as possible, by
Healthcare Index investing in iShares MSCI consolidating
(hereinafter referred to as World ESG Enhanced UCITS ETF assets into a
"the Index") as closely as securities. fund with
possible, by investing in broader
iShares Healthcare diversification,
Innovation UCITS ETF. deeper ESG
3.2 The portfolio will apart integration, and
3.2 The portfolio will apart from assets in liquid form, more consistent
from assets in liquid form, and financial instruments for global exposure
and financial instruments the exclusive purpose of while moving
for the exclusive purpose of hedging exchange rate risks, away from a one
hedging exchange rate risks, invest in participatory sector focus
invest in participatory interests of the iShares MSCI ETF.
World ESG Enhanced UCITS the
interests of the iShares iShares IV Public Limited
Healthcare Innovation UCITS Company approved by the
ETF ("the Fund") established Central Bank of Ireland in
under the iShares IV Public August 2011.
Limited Company approved by
the Central Bank of Ireland The investment objective of
in August 2011. the Fund is to provide
investors with a total
The investment objective of return, considering both
the Fund is to provide capital and income returns,
investors with a total which reflects the return of
return, considering both the MSCI World ESG Enhanced
capital and income returns, Focus NET Index. In order to
which reflects the return of achieve this investment
the STOXX Global objective, the investment
Breakthrough Healthcare policy of the Fund is to
Index. In order to achieve invest in a portfolio of
this investment objective, equity securities that as
the investment policy of the far as possible and
Fund is to invest in a practicable consists of the
portfolio of equity component securities of the
securities that as far as MSCI World ESG Enhanced
possible and practicable Focus NET Index
consists of the component Benchmark Index. The Fund
securities of the STOXX intends to use optimisation
Global Breakthrough techniques in order to
Healthcare Index, the Fund's achieve a similar return to
Benchmark Index. The Fund the Benchmark Index and it
intends to use optimisation is therefore not expected
techniques in order to that the Fund will hold each
achieve a similar return to and every underlying
the Benchmark Index and it constituent of the Benchmark
is therefore not expected Index at all times or hold
that the Fund will hold each them in the same proportion
and every underlying as their weightings in the
constituent of the Benchmark Benchmark Index. The Fund
Index at all times or hold may hold some securities
them in the same proportion which are not underlying
as their weightings in the constituents of the
Benchmark Index. The Fund Benchmark Index where such
may hold some securities securities provide similar
which are not underlying performance (with matching
constituents of the risk profile) to certain
Benchmark Index where such securities that make up the
securities provide similar Benchmark Index. However,
performance (with matching from time to time the Fund
risk profile) to certain may hold all constituents of
securities that make up the the Benchmark Index. The
Benchmark Index. However, Benchmark Index measures the
from time to time the Fund performance of developed
may hold all constituents of market companies that
the Benchmark Index. The screens out controversial
Benchmark Index measures the business areas and gives
performance of companies of greater weighting to
developed and emerging companies with higher
market companies that that environmental, social and
are focused on innovation governance (ESG) scores
within healthcare services which comply with MSCI's
which comply with STOXX's size, liquidity and free-
size, liquidity and free- float criteria.
float criteria.
3.3 The portfolio shall not
3.3 The portfolio shall not buy or sell securities for
buy or sell securities for the purpose of making a
the purpose of making a profit nor for any purpose
profit nor for any purpose other than tracking the
other than tracking the return of the Index.
return of the Index.
3.4 The Trustee shall ensure
3.4 The Trustee shall ensure that the investment policy
that the investment policy set out in the preceding
set out in the preceding clauses is adhered to.
clauses is adhered to.
Portfolio Benchmark Portfolio Benchmark The objective is
to streamline
STOXX Global Breakthrough MSCI World ESG Enhanced Focus the product
Healthcare Index CTB Index offering,
improve cost
efficiency, and
enhance investor
outcomes by
consolidating
assets into a
fund with
broader
diversification,
deeper ESG
integration, and
more consistent
global exposure
while moving
away from a one
sector focus
ETF.
Distribution Methodology Distribution Methodology No change
Annual Annual
Total Expense Ratio Total Expense Ratio The objective is
to streamline
49 bps 33 bps the product
offering,
improve cost
efficiency, and
enhance investor
outcomes by
consolidating
assets into a
fund with
broader
diversification,
deeper ESG
integration, and
more consistent
global exposure
while moving
away from a one
sector focus
ETF.
Impact of Change – Additional Information
Satrix Healthcare Satrix MSCI World ESG
Description Innovation Feeder ETF Enhanced Feeder ETF
(Source portfolio) (Target portfolio)
JSE Code STXHLT STXESG
Global – Equity – General Global – Equity – General
ASISA Classification
Risk Profile Aggressive Aggressive
Currency Risk Yes Yes
Geographical, Diversified outside of the Diversified outside of the
Political & Economic South African market South African market
Risk
Asset allocation Offshore Emerging & Offshore Developed
Developed Equity - 100% Equity - 100%
Benchmark Indices STOXX Global Breakthrough MSCI World ESG Enhanced
tracked Healthcare Index Focus CTB Index
Portfolio Holdings Feeder structure, holding Feeder structure,
the iShares Healthcare holding the iShares MSCI
Innovation UCITS ETF as World ESG Enhanced UCITS
the underlying fund ETF as the underlying
fund
Fund Denomination ZAR ZAR
Satrix Fund AUM R95mil R1.1bil
TER 0.49% 0.33%
Index Rebalancing Quarterly Bi-annually
Domicile Ireland Ireland
(underlying fund)
Distribution Reinvesting Reinvesting
(underlying fund)
Number of holdings 188 1146
UCITS AUM US$910mil US$5.5bil
How the Amalgamation Impacts Your Investment
Replacement participatory interests
When the source portfolio, Satrix Healthcare Innovation Feeder ETF is
absorbed into and amalgamated with the target portfolio, the Satrix
MSCI World ESG Enhanced Feeder ETF, investors will be issued with
replacement participatory interests (shares) in the new amalgamated
fund. The replacement shares will be equal in market/monetary value
to the shares held prior to the amalgamation, although the number of
shares held may change. The Satrix Healthcare Innovation Feeder ETF
(source portfolio) will cease to exist.
This is in accordance with Section 99 (3) (a) of the Act, which
stipulates that on the effective date, every investor:
"…shall… hold in the new scheme or portfolio such participatory
interests with an aggregate money value which is not less than the
lower of the net asset value or market value, as may be fair and
reasonable in the circumstances, of the participatory interests
which such investor, immediately before the date on which the
proposed transaction becomes effective, held in an original scheme
or portfolio;"
Details of the distribution and amalgamation salient dates will be
announced after Financial Sector Conduct Authority ("FSCA")("the
Authority") approval.
Taxation implications
Satrix does not provide tax advice, but there should be no tax impact
for investors who remain in the fund.
Effective date and approval of change
The effective date for the proposed amalgamation of the funds will be
communicated via SENS, contingent upon a successful ballot and receipt
of the requisite approval from the FSCA.
Expected timeline for the implementation of the proposed
amalgamation:
Weekday Action
Friday, 22 August 2025 Approval from FSCA
Friday, 29 August 2025 Request STRATE register holdings (Cut-off
date for investors on record to be
balloted as at 29 August 2025)
Wednesday, 3 September Release of SENS announcement
2025
Wednesday, 15 October Deadline for returned ballots (30 business
2025 days after SENS announcement)
Monday, 20 October 2025 Submission of auditors report to FSCA
Tuesday, 21 October 2025 Submission of final deed to FSCA
Friday, 31 October 2025 FSCA approve Supplemental Deed
Tuesday, 4 November 2025 SENS announcement confirming the results of
the ballot and declaration announcement
Action Required
1. Please read this circular on the proposed amalgamation, your rights
as an investor and the impact this will have on your investment.
2. Please complete the enclosed ballot form and email it directly to
our external auditors, KPMG, at satrixballotSTXHLT@kpmg.co.za on
or before 15 October 2025. If you do not participate in the ballot
in time, you will be deemed to have voted in favour of the
amalgamation.
3. Please do not include any other instructions regarding your
holdings with your ballot form, e.g., requests for purchases,
switching instructions, etc. Your ballot form will go directly to
our auditors and, should such instructions be sent to the auditors,
we cannot guarantee that any instruction subsequent to the
commencement of the ballot process will be effected.
4. If you are no longer invested in the Satrix Healthcare Innovation
Feeder ETF, no action is required.
Your Rights As An Investor
The rights of investors are firmly entrenched in the Act. In terms
of Section 99 of CISCA, as read with Clause 59 of the Deed of the
Satrix Collective Investment Scheme in Securities, the Authority
requires that:
• All investors in the affected source portfolios will be informed
in writing on the details of the proposed amalgamation of the
portfolios.
• All source portfolio investors are given an opportunity to vote
in favour of, or against, the proposed amalgamation.
• An independent auditor will verify the outcome of the ballot.
• All investors will be notified in writing of any proposed
material changes to the collective investment schemes and
portfolios in which they hold units, and
• All investors will be given the opportunity to vote on the
proposed changes.
If investors do not respond before the cut-off date, they will be
deemed to have voted in favour of the change.
If the ballot is successful and you do not want your investment to be
included in the amalgamation, you may elect to sell your securities
at any time before the amalgamation effective date and withdraw your
funds at the prevailing market price of the Satrix Healthcare
Innovation Feeder ETF. Please note that such sale transaction may
trigger a CGT event and that you may be liable for CGT at your next
income tax assessment, and such transaction may also attract brokerage
cost.
If you choose not to sell your funds prior to the effective date of
the amalgamation, the amalgamation proposals, as set out in this
letter (if approved by investors), will automatically apply to your
investment.
Should you require further information on the proposed change you
can also email us on info@satrix.co.za.
JSE Sponsor
Vunani Sponsors
3 September 2025
Date: 03-09-2025 12:35:00
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