Claymore Investments, Inc. is holding a special unitholder meeting on June 5 to consider a proposal to merge Adjustable Rate MBS Trust with Claymore Global Monthly Advantaged Dividend ETF, the company said Monday.

The merger is being proposed to provide unitholders of Adjustable Rate MBS Trust the opportunity to invest in a fund that will have a larger market capitalization, increased liquidity and a lower management expense ratio, Claymore says.

Claymore Global Monthly Advantaged Dividend ETF is an ETF which provides its unitholders with exposure to the performance of the Zacks Global Multi-Asset Income Index, a proprietary index designed to identify companies with potentially high income and superior risk-return profiles while maintaining industry diversification. As with Adjustable Rate MBS Trust, distributions made by Claymore Global Monthly Advantaged Dividend ETF are expected to consist primarily of capital gains and returns of capital and are intended to be tax efficient when compared to units of a trust that depends solely on interest, dividend and/or other investment income to pay distributions.

If the merger proposal is approved, all of Adjustable Rate MBS Trust’s net assets will be transferred to Claymore Global Monthly Advantaged Dividend ETF in consideration for Advisor Class Units of Claymore Global Monthly Advantaged Dividend ETF based on an exchange ratio to be determined by reference to the relative net asset values of the units of Adjustable Rate MBS Trust and Claymore Global Monthly Advantaged Dividend ETF.

As part of the Merger Proposal, the scheduled annual redemption period of Adjustable Rate MBS Trust will be extended from June 1 to June 30 in order to allow Adjustable Rate MBS Trust unitholders who do not wish to participate in the merger an opportunity to exit.

If the merger proposal is not approved, the Claymore board of directors has approved a proposal providing for the wind-up and termination of the Adjustable Rate MBS Trust on June 30.

In order to become effective, the merger must be approved by a two-thirds majority of unitholders of Adjustable Rate MBS Trust present in person or represented by proxy at the special meeting. The merger is also subject to the receipt of all necessary regulatory approvals.

IE