In a letter to shareholders of the two funds, BlackRock said that in an effort to ensure that the funds are kept within a size that “best enables them to be managed optimally”, a decision has been taken to introduce a €1,700m capacity limit on its European Credit Strategies Fund and a €175m capacity limit on the size of its European Constrained Credit Strategies Fund. As of the end of April the net asset value of the two funds were approximately €1,350m and €131m respectively.
According to BlackRock the purpose of closing the fund is to protect the interests of existing investors and ensure that the portfolio managers concerned can continue to run the portfolio in the same way that they have in the past.
“Where steps are not taken to manage the size of a capacity constrained fund, a consequence may be a shortfall of available assets in which the proceeds of further subscriptions can be invested in line with the investment objective,” it said.
