SYDNEY, AUSTRALIA: WAM Leaders Limited (ASX: WLE) has announced a Scheme Implementation Agreement to merge with QV Equities Limited (ASX: QVE), in a transaction poised to reshape the landscape of listed investment companies.

Under the proposed Scheme of Arrangement, WAM Leaders will acquire all shares of QVE, offering QVE shareholders new WAM Leaders shares as consideration. The exchange rate of these shares will be calculated based on the pre-tax net tangible assets (NTA) of both entities at a set calculation date. Additionally, QVE shareholders have the option to receive cash at a 2.5% discount to QVE’s pre-tax NTA or opt for a mix of shares and cash.

The merger is expected to yield a combined entity with a market capitalisation nearing $2 billion and a shareholder base of approximately 30,000. The union is projected to bolster WAM Leaders’ net assets by an estimated $238.8 million, as of March 8, 2024.

Geoff Wilson AO, Chairman and Chief Investment Officer of WAM Leaders, expressed confidence in the merger’s capacity to benefit shareholders through enhanced market presence and access to broader opportunities. The merger is also anticipated to lower management expense ratios by consolidating costs and spreading expenses over a larger asset pool.

The execution of the Scheme Implementation Agreement sets forth the terms for the merger, contingent upon approval from QVE shareholders, an independent expert’s endorsement, and Federal Court sanctioning. The exchange ratio determination will align with the Scheme’s legal binding date, ensuring NTA fluctuations are accounted for.

QVE shareholders are slated to vote on the Scheme in a meeting anticipated for late June 2024, with comprehensive details to be provided in the Scheme Booklet, expected to reach shareholders by mid-to-late May 2024.