Assets in the FBR Fund for Government Investors were merged into the Legg Mason-sponsored Western Asset Government Money Market Fund. In a prospectus supplement dated December 7, 2009, the FBR funds says, "Effective as of the close of business on December 4, 2009, shares of the FBR Fund for Government Investors are no longer offered. Effective on that date, the assets of the Fund were transferred to another money market fund as part of a reorganization transaction and the Fund has been terminated as a separate investment series of The FBR Funds."
Western spokeswoman Mary Athridge tells Crane Data, "This transaction was undertaken to give shareholders in FGI the opportunity to be part of a larger fund with a similar investment objective and investment strategies and offers the potential for greater economies of scale. The Western Asset Fund is much larger ($6.7 billion in AUM as of September 30, 2009) as opposed to FGI, which had $70 million in AUM as of December 1, 2009."
She adds, "There was a tax-free reorganization on December 4, 2009 in which FGI investors received Class A shares of Western Asset Government Money Market Fund with the same aggregate net asset value as the FGI shares they owned immediately prior to the reorganization. While a relatively small transaction, this is one step in continuing to build up Legg Mason and Western Asset's liquidity business. We are continuing to explore options such as this type of transaction in order to build our liquidity business."
For more on liquidations, mergers, outsourcing and consolidation, see the December issue of Money Fund Intelligence, which features the article, "BlackRock, BGI Merger Shrinks Money Fund Manager Universe". The piece says, "Though formerly major players Reserve and Credit Suisse have exited the money fund stage, almost all of the other retreats have been either partial or have been very minor.... Liquidated funds from Monetta, Monarch, Calamos, and Pax World, combined would barely eke out a 0.1% in market share."
