3.33.6.5 Maintain Details for Side Pocket Merger

This topic provides information on maintaining details for side pocket merger details.

For side pocket merger, you must maintain related details in the Corporate Actions Maintenance screen. Select the Side Pocket Merger option in the Corporate Action Type field.

You can perform merger of side pockets with the main fund by following the instructions specified below:

• Select Side Pocket Merger option in the Corporate Action Type field.
• Specify the Parent Ratio for merger in Merger Details tab.
• System performs 100% redemption of the side pocket fund
• Unit based subscription transactions are generated for the main fund
• The transactions are allotted based on the allocation lag and price availability

After merger, you need to manually disable the side pocket funds.

The example given below illustrates the merger of a side pocket fund:

Example:

Assume that JPMORG is a Hedge Fund and SIDEP1 is a side pocket of JPMORG. The current holdings of all unit holders are as below:

Table 3-64 Unit holder ID & Units

Unit holder ID	Units
UH1	1000
UH2	1500
UH3	2000
UH4	2500

Side Pocket Creation: Split Ratio 0.1

Units in JPMORG

Table 3-65 Units in JPMORG

Unit holder ID	Units
UH1	900
UH2	1350
UH3	1800
UH4	2250

Units in SIDEP1

Table 3-66 Units in SIDEP1

Unit holder ID	Units
UH1	100
UH2	150
UH3	200
UH4	250

Side Pocket Merger: Merger Ratio .05

Units in JPMORG (before merger)

Table 3-67 Units in JPMORG (before merger)

Unit holder ID	Units
UH1	900
UH2	1350
UH3	1800
UH4	2250
UH5	1000
UH6	2000

Units in JPMORG (after merger)

Table 3-68 Units in JPMORG (after merger)

Unit holder ID	Units
UH1	905
UH2	1357.5
UH3	1810
UH4	2262.5
UH5	1000
UH6	2000

SIDEP1 fund will be disabled after merger process. There will not be any change in units of the new unit holders who subscribed in JPMORG after side pocket creation.