Three-day voting window to open on June 9: Franklin Templeton MF

Franklin Templeton Mutual Fund, which closed its six debt schemes, on Thursday said the voting window for affected investors would be opened for three days starting June 9. The e-voting window would open on June 9 and close on June 11 and the unitholders' meeting through video conferencing would happen on June 12, the fund house said in notices to investors.

It further asked investors, who have not registered their e-mail ID yet, to register it by June 8 as those who do not have an e-mail ID or mobile number registered with the fund house will not be able to participate in the voting process. Each unitholder is entitled to vote only once per scheme that they have invested in, irrespective of the number of units.

Investors are being asked to vote as schemes can be wound up only after repaying the amount due to the unitholders. The steps to wind up the schemes include active monetization of assets and return of the investment proceeds to the unitholders.

K Fintech has been entrusted by the fund house to carry out the voting process. The fund house said that investors will have two options on how the scheme assets should be monetized -- authorize the trustees assisted by Kotak Mahindra Bank as independent advisor and supported by the AMC or authorize Deloitte Touche Tohmatsu India LLP assisted by the AMC with the AMC being advised by Kotak.

If majority of unitholders select Deloitte, the trustee's role will be restricted to distribution of proceeds to unitholders after payment of liabilities and expenses. Investors will also have an option to vote 'no' for either of the two proposals but this will delay the monetization of scheme assets.

According to the fund house, in the absence of authorization, the winding up process will be delayed as further steps will be possible only after seeking fresh authorization from the unitholders. The pay-outs to investors can be finalized and implemented only after the successful completion of the voting process.

Franklin Templeton MF said the proceeds of sale will be first utilized towards discharge of liabilities that are due and payable under the scheme and after making appropriate provision for meeting the expenses connected with such winding up, the balance will be paid to the unitholders in proportion to their respective interest in the assets of the scheme. It is the endeavor of trustees to liquidate the assets in an orderly manner and distribute the proceeds to the unitholders in the earliest possible opportunity.

Last month, the fund house had closed six of its debt funds, citing redemption pressures and lack of liquidity in the bond markets. These schemes, together with having an estimated amount of over Rs 25,000 crore assets under management, were Franklin India Low Duration Fund, Franklin India Dynamic Accrual Fund, Franklin India Credit Risk Fund, Franklin India Short Term Income Plan, Franklin India Ultra Short Bond Fund and Franklin India Income Opportunities Fund.