
Carmignac Merger Arbitrage: Letter from the Portfolio Managers
Dear investors,
After a rather difficult year for the Merger Arbitrage asset class, we nevertheless managed to preserve our investors' capital. The performance of our funds was positive, with an increase of +3.79% for Carmignac Portfolio Merger Arbitrage (I EUR Acc shareclass) and +3.68% for Carmignac Portfolio Merger Arbitrage Plus (I EUR Acc shareclass).
Market environment
The fourth quarter was marked by a series of events characteristic of the year 2024 :
- Two emblematic transactions (Capri and Albertsons) were blocked by the US courts.
- Deals came under increased scrutiny from competition authorities (Catalent, Shinko Electric Industries and Juniper).
- Failure of a deal in Asia (China Traditional Chinese Medicine) largely played by arbitrageurs, resulting in a 45% fall in the target's share price.
- Uncertainty over certain discounts (United States Steel) and technical volatility over others (DS Smith).
All in all,** there was widespread tension across all Merger Arbitrage (M&A) spreads,** which are usually fairly stable at the end of the year. This increase in volatility was exacerbated by the unwinding and closure of several M&A portfolios within the largest multi-strategy investment platforms.
In terms of M&A activity in the final quarter of 2024, there was a slight decline of 1%1 in volume and 9%1 in value worldwide compared with the previous quarter1. This drop in activity is not unusual in the run-up to the US elections. The rebound in M&A activity in Europe was particularly impressive, with growth of 60%* in value terms compared with the previous quarter1. Significant deals included the acquisition of Covestro in Germany for $16bn and Unicredit's hostile bid for its competitor Banco BPM for $11bn.
Performance Review
This particularly difficult environment obviously had an impact on the performance of M&A funds. The HFRX Merger Arbitrage index fell by 0.93%** over the last quarter1.
However, we fared well, posting a positive performance of +0.89% over the same period.
This good performance can be explained by :
- Strict application of our investment process prompted us not to participate in the preliminary offer for China Traditional Chinese Medicine.
- Rigorous portfolio construction, with each position weighted according to its potential loss in the event of failure. We were indeed present in Capri and Albertsons, but the negative impact of these failures was more than offset by the portfolio's gains elsewhere.
- A traditionally cautious approach to transactions with too high a political risk. For example, we stayed away from the United States Steels deal.
- A fundamental approach to the issues, which enabled us to keep discounts under pressure, such as Catalent (closed in December), Juniper and Shinko Electric Industries (still in progress).
Outlook for 2025?
We believe that the outlook for 2025 is much brighter, thanks to a more favourable antitrust environment for M&A activity worldwide:
- In the US, following the election of Trump, the administration is due to be renewed, which should result in a reset of antitrust policy in certain economic sectors.
- In Europe, a change of doctrine with the publication of the Draghi report recommending the emergence of national champions to face up to global competition.
- In the United Kingdom, the new government is encouraging the competition authority to take greater account of economic considerations in their decisions.
- In Japan, capital markets continue to be opened up to foreign investors.
Lower interest rates are also likely to drive M&A activity in the quarters ahead.
In these conditions, the M&A cycle that began at the end of 2023 should continue to gain momentum. As a result, we expect to be able to deploy more capital in M&A, while keeping risks under control through good fund diversification.
Merger Arbitrage Team
Carmignac Portfolio Merger Arbitrage Plus I EUR Acc
- Horizonte de investimento mínimo recomendado
- 3 anos
- Escala de Risco*
- 2/7
- Classificação SFDR**
- Artigo 8
*Escala de Risco do KID (documentos de informação fundamental). O risco 1 não significa um investimento isento de risco. Este indicador pode variar ao longo do tempo. **Regulamento SFDR (Sustainable Finance Disclosure Regulation) 2019/2088. A classificação SFDR dos Fundos pode evoluir ao longo do tempo.
Principais riscos do fundo
volumes de negociação de ações ou capitalização bolsista.
Comissões
- Custos de entrada
- Não cobramos uma comissão de subscrição.
- Custos de saída
- Não cobramos uma comissão de saída para este produto.
- Comissões de gestão e outros custos administrativos ou operacionais
- 1,12% O impacto dos custos que suportamos anualmente pela gestão dos seus investimentos e outras comissões administrativas. Esta é uma estimativa baseada nos custos efetivos ao longo do último ano.
- Comissões de rendimento
- 20,00% como máximo da performance superior, se a performance for positiva e o valor patrimonial líquido exceder a high-water mark. O montante real irá variar dependendo da performance do seu investimento. A estimativa de custo agregado acima inclui a média dos últimos 5 anos, ou desde a criação do produto, se for inferior a 5 anos.
- Custos de transação
- 0,23% O impacto dos custos inerentes às nossas operações de compra e de venda de investimentos subjacentes ao produto.
Desempenho
| Carmignac Portfolio Merger Arbitrage Plus | +2,3 | +4,6 | +3,7 | +3,2 |
| Carmignac Portfolio Merger Arbitrage Plus | +3,0% | +3,7% | +3,9% |
Fonte: Carmignac em 30 de out de 2026.
Data do primeiro VPL : 14/04/2023.
O desempenho passado não é necessariamente um indicador do desempenho futuro. Os desempenhos são líquidos de comissões (excluindo eventuais comissões de subscrição cobradas pelo distribuidor). O Fundo apresenta um risco de perda do capital.
O retorno pode aumentar ou diminuir em resultado de flutuações cambiais, para as acções que não estão cobertas por divisas.
Indicador de Referência: -