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Van Eck Global offers ETF swap to HOLDRS investors


Van Eck’s Market Vectors ETF Trust plans to offer investors in six Merrill Lynch-sponsored HOLding Depository ReceiptS (HOLDRS) – Oil Services (OIH), Semiconductor (SMH), Pharmaceutical (PPH), Biotech (BBH), Retail (RTH), and Regional Bank (RKH) – the opportunity to exchange their shares in these funds for shares of new Market Vectors exchange-traded funds (ETFs).


These HOLDRS had approximately USD3.65 billion in aggregate assets and a combined 30-day average daily trading volume of approximately 20.07 million shares as of the close of trading on August 11, 2011. Terms of the transaction were not disclosed.

Van Eck’s proposed exchange offer is expected to allow participating investors the opportunity for uninterrupted exposure to target industries. The new ETFs are expected to retain the corresponding HOLDRS’ ticker symbols. Van Eck expects the exchange offer to be launched early in the fourth quarter of 2011 and the transaction to be consummated later in the fourth quarter of 2011. The exchange offer documents, which are expected to be filed with the Securities Exchange Commission (SEC) in September 2011, will contain information about the transaction including its mechanics and potential tax implications.

"As a leading provider of exchange-traded funds, Van Eck Global is an excellent partner for us on this transaction," says Liam O’Neil (pictured), Head of Market Linked Solutions at Merrill Lynch.

The six new ETFs will be part of Van Eck’s family of Market Vectors ETFs. Upon the completion of Van Eck’s expected exchange offer, Merrill Lynch intends to delist the six HOLDRS included in the transaction and liquidate them thereafter.

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