IndexIQ Announces October 2014 M&A Deal Holdings In IQ Merger Arbitrage ETF [IndexIQ IQ ARB Merger Arbitrage ETF]

indexiqIndexIQ, a leading developer of index-based alternative investment solutions, today announced the mergers and acquisitions (M&A) deals to which investors can gain exposure in the IQ Merger Arbitrage ETF (NYSEARCA:MNA). MNA was the industry’s first exchange-traded fund (ETF) to give investors exposure to global corporate M&A activity, which is rapidly increasing.

“Historically, investors have not had broad access to capitalize on mergers and acquisitions activity in an ETF”

MNA has more than four years of live performance, having launched on November 17, 2009, while its underlying index, the IQ Merger Arbitrage Index, has more than six years of live performance, having launched on October 31, 2007.

MNA was designed to provide capital appreciation by investing in global companies for which there has been a public announcement of a takeover by an acquirer, a strategy generally known as “merger arbitrage.” This strategy generally seeks to take advantage of the price differential, where it exists, between the current trading price of a stock and the price of that stock at the time the deal is completed.

As of October 2, 2014, the deals that were added to and removed from the IQ Merger Arbitrage ETF are as follows:

MNA Deals Added to MNA ETF
Target Acquirer Target Target Announce Added
Name Name Sector Country Date Date
Alere Inc. Alere, Inc. /Private Group/ Health Care United States 09/15/2014 10/03/2014
Athlon Energy, Inc. EnCana Corp. Energy United States 09/29/2014 10/03/2014
Auxilium Pharmaceuticals, Inc. Endo International Plc Health Care United States 09/16/2014 10/03/2014
Compuware Corporation Thoma Bravo LLC Technology United States 09/02/2014 10/03/2014
Concur Technologies, Inc. SAP SE Consumer Cyclicals United States 09/18/2014 10/03/2014
Conversant Inc. Alliance Data Systems Corp. Consumer Cyclicals United States 09/11/2014 10/03/2014
Dresser-Rand Group Inc. Siemens AG Energy United States 09/21/2014 10/03/2014
Glimcher Realty Trust Washington Prime Group, Inc. Financials United States 09/16/2014 10/03/2014
Kodiak Oil & Gas Corp. Whiting Petroleum Corp. Energy United States 07/13/2014 10/03/2014
Nobel Biocare Services AG Danaher Corp. Health Care Switzerland 09/15/2014 10/03/2014
Sigma-Aldrich Corporation Merck KGaA Basic Materials United States 09/22/2014 10/03/2014
TIBCO Software Inc. Vista Equity Partners LLC Technology United States 09/29/2014 10/03/2014
MNA Deals Removed from MNA ETF
Target Acquirer Announce Added Deal
Name Name Sector Country Date Date Result
InterMune, Inc. Roche Holding AG Health Care United States 08/24/2014 09/04/2014 Completed
Bell Aliant Inc. BCE, Inc. Communication Services Canada 07/23/2014 08/05/2014 Completed
Panaust Limited Guangdong Rising Assets Management Co., Ltd. Basic Materials Australia 05/12/2014 06/04/2014 Min Wt
Safeway Inc. Cerberus Capital Management LP Consumer Staples United States 03/06/2014 05/05/2014 Max Age
Sai Global Limited Pacific Equity Partners Pty Ltd. Consumer Cyclicals Australia 05/26/2014 06/04/2014 Cancelled
Treasury Wine Estates Limited KKR Holdings LP Consumer Staples Australia 05/20/2014 06/04/2014 Cancelled

“Historically, investors have not had broad access to capitalize on mergers and acquisitions activity in an ETF,” said Adam Patti, chief executive officer at IndexIQ. “The Merger Arbitrage ETF is a hedged strategy designed to take advantage of price disparities that exist in merger activity and strengthen investor portfolios by buying below the target price and realizing the capital appreciation if the deal closes at or above the target price. As such a strategy had not historically been accessible in an ETF before the launch of MNA more than four years ago, we are very excited about providing investors with this liquid, transparent, low cost, and easily tradable product.”

Merger Arbitrage funds typically have the potential to benefit from buying target companies below the target price. The “spread” in price, the difference between the target price and market price, can be quite lucrative for investors, especially if there are competitive bids for a company. Given today’s relatively low corporate valuations and the significant amount of cash on corporate balance sheets, industry experts forecast a rapid increase in M&A activity.

The IQ Merger Arbitrage ETF seeks to track, before fees and expenses, the performance of the IQ Merger Arbitrage Index. The Index seeks to achieve capital appreciation by investing in global companies for which there has been a public announcement of a takeover by an acquirer. This approach is based on a passive strategy of owning certain announced takeover targets with the goal of generating returns that are representative of global merger arbitrage activity. The Index also includes short exposure to global equities as a partial equity market hedge.

IndexIQ indexes underlie a variety of investment products, including ETFs, mutual funds, and institutional accounts. IndexIQ products are designed to be liquid, transparent, low cost,* and accessible to a broad range of investors, many of which are the first of their kind to be introduced to the market, including:

  • IQ Alpha Hedge Strategy Fund (IQHIX – Institutional Share Class; IQHOX – Investor Share Class), the first open-end, no-load hedge fund replication mutual fund;
  • IQ Hedge Multi-Strategy Tracker ETF (NYSE Arca: QAI), the first US-listed hedge fund replication Exchange-Traded Fund;
  • IQ Hedge Market Neutral Tracker ETF (NYSE Arca: QMN) providing exposure to the market neutral hedge fund universe;
  • IQ Hedge Macro Tracker ETF (NYSE Arca: MCRO), the first Global Macro/Emerging Markets hedge fund replication ETF;
  • IQ Merger Arbitrage ETF (NYSE Arca: MNA), the first merger arbitrage ETF;
  • IQ Real Return ETF (NYSE Arca: CPI), the first US-listed “real return” ETF, which seeks to generate a real return above the rate of inflation as measured by changes in the Consumer Price Index;
  • IQ US Real Estate Small Cap ETF (NYSE Arca: ROOF), the first US Real Estate Small Cap ETF;
  • IQ Global Resources ETF (NYSE Arca: GRES), the first hedged global natural resources ETF;
  • IQ Global Agribusiness Small Cap ETF (NYSE Arca: CROP), the first agribusiness small cap ETF;
  • IQ Global Oil Small Cap ETF (NYSE Arca: IOIL), the first global oil small cap ETF;
  • IQ Canada Small Cap ETF (NYSE Arca: CNDA), the first Canada small cap ETF;
  • IQ Australia Small Cap ETF (NYSE Arca: KROO), the first Australia small cap ETF.
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