T. Rowe Price Institutional Africa & Middle East Fund to liquidate

TheShadow

https://www.sec.gov/Archives/edgar/data/852254/000174177320000504/c497.htm

497 1 c497.htm IAM STICKER

T. Rowe Price Institutional Africa & Middle East Fund

Supplement to Prospectus and Summary Prospectus Dated March 1, 2020

At a Board meeting held on March 9, 2020, the fund’s Board of Directors approved the closure and liquidation of the fund. The closure and liquidation are expected to occur on May 8, 2020 (“Liquidation Date”). Prior to the Liquidation Date, the assets of the fund will be liquidated at the discretion of the fund’s portfolio management and the fund will cease to pursue its investment objective. In anticipation of the closure and liquidation, effective April 27, 2020, the fund will be closed to new investors or existing shareholders to purchase Fund shares. At any time prior to the termination, we welcome you to exchange your shares of the fund for the same class of shares of another T. Rowe Price fund. After the fund is closed and liquidated, the fund will no longer be offered to shareholders for purchase.

The date of this supplement is March 11, 2020.

E171-041 3/11/20

msf

I wonder why TRP isn't simply merging this fund into its retail Africa & Middle East fund, converting TRIAX shares into the institutional class shares PRAMX of the latter fund. Same manager, effectively clones.

TRIAX page: https://www.troweprice.com/financial-intermediary/us/en/investments/mutual-funds/us-products/institutional-africa-middle-east-fund.html

PRAMX page: https://www.troweprice.com/content/fai/us/en/investments/mutual-funds/us-products/africa-and-middle-east-fund/i-class.html

TheShadow

@msf

I own the investor class of this fund. Curious to learn whether they are considering to liquidate the investor class as well.

msf

To clarify - these are two different funds. The fund being liquidated is "Institutional Africa & Middle East Fund". The fund you own, which has two share classes (investor and institutional) is "Africa & Middle East Fund".

The former (TRIAX) has $33.6M AUM. Your fund has $101.4M AUM, divided between PRAMX and TRAMX (your shares). PRAMX (the institutional class shares of your fund) are not being liquidated. That is, unless you run across a new SEC filing for this fund.

(Figures are from T. Rowe Price pages, not M*)

TheShadow

Yes; however both are small funds based on AUM (one larger than the other). The retail class has been around for years, but never really garnered assets. Keep in mind Templeton is in the process of liquidating its Frontier Markets Fund, (which I exchanged into their Convertible Securities Fund prior to its closing to new investors).

With oil taking a hit of late, it may affect Frontier Market type of funds.

msf

I see the confusion - terminology. What you call the "retail class" is a fund with two classes, a retail class and an institutional class. The latter (PRAMX) has the same $1M min as the institutional fund's single share class.

The retail fund (including its institutional class) has indeed been around for several years. I always thought of it as a narrow niche product and was somewhat surprised it hung around so long. I believe $100M is large enough for a fund to be viable, albeit not extremely profitable for the management company.

T.Rowe Price was (still is, for now) practically alone in offering an African-focused fund. (M* shows 15 misc. region funds; the only other fund focused on Africa is the $2M CAFRX fund.)

The Templeton fund TFMAX is (was?) a broader fund, with around 2/5 in each of Africa/Middle East and Asian EM countries; the remaining holdings are in Latin America.

Here's a 2015 M* column that suggests a few alternatives:
https://www.morningstar.com/articles/719486/frontier-markets-havent-been-immune