Carmignac Portfolio Merger Arbitrage Plus

• The month was particularly quiet in terms of ongoing transactions, with few specific news items. Noteworthy, however, was the rejection by Banca Generali shareholders of the acquisition by Mediobanca.• The positive note of the month came from M&A activity, which remained very buoyant despite the summer period, which is usually quieter.
• Thirty-three new transactions were announced in August, up 27% from last year, for a total of $92 billion.
• With $30 billion, Europe is proving to be one of the main drivers of the recovery in M&A activity. One example is the $23 billion acquisition of Dutch coffee and tea producer JDE Peet's by US company Keurig Dr Pepper.
• Against a backdrop of continuing low interest rates, private equity funds are continuing to grow in strength, with 30% of announced transactions being LBOs. An example is Thoma Bravo's $11 billion acquisition of Dayforce in the United States.
• During the month, there was a general tightening of merger arbitrage spreads, supported by the redeployment of capital after a month of July marked by the completion of 34 transactions totalling approximately $190 billion.

• The fund posted positive performance during the month.• The main contributors to performance were: Frontier Communications, Verona, and Spartannash.
• The main detractors from performance were: Olo, Cantaloupe, and Banca Generali.

• The fund's investment rate stands at 109%, up from the previous month. Despite the high number of transactions exiting the portfolio over the last two months, new transactions announced at the end of July and in August have increased the capital deployed in the strategy.• With 65 positions in the portfolio, diversification remains satisfactory: the increase in the investment rate is therefore accompanied by a marginal increase in the overall risk of the portfolio.
• 2025 continues to look much more promising than 2024 thanks to an antitrust environment that is more favorable to M&A activity worldwide: a change of administration in the US following Trump's election, the publication of the Draghi report in Europe recommending the emergence of national champions to face global competition, regulators in the UK pushed by politicians to prioritize economic activity, and the Japanese market continuing to open up to foreign capital.
• Lower interest rates should also drive M&A activity in the coming quarters.
• While the instability linked to the tariff war launched by the Trump administration, combined with geopolitical tensions, slowed momentum and made the recovery less sustained than hoped for in the first half of the year, the significance of the announcements made at the end of the summer and the increase in bidding wars allow us to be very optimistic about the second half of the year.