Van Eck Begins Exchange Offers For Six HOLDRs Funds

Van Eck Global, the sixth-largest U.S. ETF issuer, has commenced its exchange offers for six Merrill Lynch-sponsored HOLDRs ETFs. Unless extended, the exchange offers are slated to expire at 11 AM EST on December 20, 2011. The six HOLDRs funds being exchanged by Van Eck are the following: Oil Services OIH, Semiconductor SMH, Pharmaceutical PPH, Biotech BBH, Retail RTH, and Regional Bank RKH. The HOLDRs funds will become Market Vectors ETFs and retain their current tickers. There is no cost to investors to participate in the exchange. The transaction is structured to be an equal value exchange, i.e., the value of the shares of the new ETF received by investors participating in the exchange will be expected to have the equivalent value to the tendered HOLDRS, according to a statement issued by Van Eck. The new indexes the funds will track are as follows: The U.S. Listed Oil Services 25 Index, the U.S. Listed Semiconductor 25 Index, the U.S. Listed Pharmaceutical 25 Index, the U.S. Listed Biotech Index, the U.S. Listed Retail Index and the U.S. Listed Bank and Brokerage 25 Index. As of the close of trading on November 9, 2011, the six HOLDRS subject to Van Eck's exchange offers had approximately $3.5 billion in aggregate assets and a combined 30-day average daily trading volume of approximately 17.36 million shares, according to the Van Eck Statement. The new Market Vectors ETFs will begin trading the day after the HOLDRs' final trading day. Van Eck had 37 ETFs with $23.9 billion in assets under management at the end of October, according to data from the National Stock Exchange.