[Federal Register Volume 66, Number 67 (Friday, April 6, 2001)]
[Notices]
[Pages 18324-18326]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-8467]


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SECURITIES AND EXCHANGE COMMISSION

[Rel. No. IC-24922; File No. 812-12336]


Barr Rosenberg Series Trust, et al.

March 30, 2001.
AGENCY: Securities and Exchange Commission (the ``Commission'' or 
``SEC'')

ACTION: Notice of application for an order pursuant to Section 17(b) of 
the Investment Company Act of 1940 (the ``1940 Act'') for an exemption 
from Section 17(a) of the 1940 Act.

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Summary of Application: The Applicants seek an order to permit the sale 
of substantially all the assets of the Barr Rosenberg VIT Market 
Neutral Fund to the AXA Rosenberg Value Market Neutral Fund (the 
``Merger'').

Applicants: Barr Rosenberg Variable Insurance Trust (the ``VIT''), on 
behalf of its Barr Rosenberg VIT Market Neutral Fund (the ``VIT 
Fund''), Barr Rosenberg Series Trust (the ``Series Trust'' and, 
together with the VIT, the ``Trust''), on behalf of its AXA Rosenberg 
Value Market Neutral Fund (the ``Value Fund'' and, together with the 
VIT Fund, the ``Funds''), the Funds' investment adviser, AXA Rosenberg 
Investment Management LLC (the ``Adviser'') and the VIT Fund's sole 
shareholder and the parent company to the Adviser, AXA Rosenberg Group 
LLC, (``AXA Rosenberg Group'' and, together with the Trusts, the Funds 
and the Adviser, the ``Applicants'').

Filing Date: The application was filed on November 21, 2000, and 
amended and restated on March 29, 2001.

Hearing or Notification of Hearing: An order granting the application 
will be issued unless the Commission orders a hearing. Interested 
persons may request a hearing by writing to the Secretary of the 
Commission and serving Applicants with a copy of the request, 
personally or by mail. Hearing requests should be received by the 
Commission by 5:30 p.m. on April 24, 2001, and should be accompanied by 
proof of service on the Applicants in the form of an affidavit or, for 
lawyers, certificate of service. Hearing requests should state the 
nature of the writer's interest, the reason for the request, and the 
issues contested.

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Persons who wish to be notified of a hearing may request notification 
by writing to the Secretary of the Commission.

ADDRESSES: Secretary, Securities and Exchange Commission, 450 Fifth 
Street, NW., Washington, DC 20549-0609; Applicants: c/o Joseph B. 
Kittredge Jr., Esq., Ropes & Gray, One International Place, Boston, 
Massachusetts 02110.

FOR FURTHER INFORMATION CONTACT: Martha Atkins, Attorney, at (202) 942-
0668, or Keith Carpenter, Branch Chief, at (202) 942-0679, Office of 
Insurance Products, Division of Investment Management.

SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application is available for a fee from the 
SEC's Public Reference Branch, 450 Fifth Street, NW., Washington, DC 
20549-0102 (telephone (202) 942-8090).

Applicants' Representations

    1. The Series trust is a Massachusetts business trust organized 
under the laws of The Commonwealth of Massachusetts and is registered 
on Form N-1A under the 1940 Act as a diversified, open-end management 
investment company. The Series Trust has issued shares of beneficial 
interest in ten series, each of which represents an interest in a 
different investment portfolio. Each series of the Series Trust, 
including the Value Fund, is managed by the Adviser.
    2. The Value Fund's investment objective is to increase the value 
of an investment in bull markets and in bear markets through strategies 
designed to maintain limited net exposure to general equity market 
risk. It seeks to achieve its investment objective by buying common 
stocks that the Adviser believes are undervalued and by ``selling 
short'' stocks that the Adviser believes are overvalued. The Value Fund 
seeks to have approximately equal dollar amounts invested in long and 
short positions and near neutral exposure to specific industries, 
specific capitalization ranges and certain other risk factors. The 
Value fund invests primarily in stocks that are principally traded in 
the markets of the United States, and measures its performance by a 
comparison to 3-month U.S. Treasury Bills.
    3. The VIT is a Massachusetts business trust organized under the 
laws of The Commonwealth of Massachusetts and is registered on Form N-
1A under the 1940 Act as a diversified, open-end management investment 
company. The sole series of the VIT is the VIT Fund, which is managed 
by the Adviser.
    4. AXA Rosenberg Group, a holding company for the AXA Rosenberg 
businesses, is the sole member and 100% owner of the Adviser and as 
such may be deemed an affiliate of the Adviser under the 1940 Act. AXA 
Rosenberg Group is a controlling shareholder of the VIT Fund and 
therefore may be deemed an affiliate of the Value Fund by virtue of its 
beneficial ownership, as of January 31, 2001, of 100% of the 
outstanding voting securities of the VIT Fund.
    5. The VIT Fund was originally launched by the VIT as a clone of 
its retail counterpart, the Value Fund. Accordingly, the investment 
objective and strategies of the VIT Fund are substantially identical to 
those of the Value Fund as described above.
    6. The Adviser is the investment adviser to both Trusts and the 
Funds. The Adviser is responsible for making investment decisions for 
the Funds and managing the Funds' other affairs and business, subject 
to the supervision of the Trust's Board of Trustees. The Adviser also 
provides investment advisory services to a number of institutional 
investors as well as the other portfolios of the Series Trust.
    7. Since its inception, the VIT Fund has never achieved returns 
sufficient to enable the Adviser to market its shares successfully to 
insurance company separate accounts. Consequently, the Adviser 
continues to incur the substantial costs of maintaining the VIT Fund, 
even though its asset base has never grown beyond the contributions of 
AXA Rosenberg Group. Given its historical record, the VIT Fund is 
unlikely to attract insurance companies to utilize it as a funding 
vehicle for variable products and thus is expected to present a 
constant drain on the Adviser's assets while providing no benefit to 
the investing public.
    8. The Trusts are proposing to effect the Merger pursuant to an 
Agreement and Plan of Reorganization (the ``Plan''). The Plan provides 
that substantially all of the assets, subject to the liabilities, of 
the VIT Fund will be sold to the Value Fund. The Plan further provides 
that, as payment for such assets, the Value Fund will issue to the VIT 
Fund a number of its Institutional Shares having an aggregate net asset 
value equal to the aggregate value of the net assets of the VIT Fund 
exchanged therefor. Those Institutional Shares of the Value Fund will 
then be distributed to AXA Rosenberg Group, as the VIT Fund's sole 
shareholder. The value of the assets of both Funds will be calculated 
in accordance with the Series Trust's valuation procedures as set forth 
in the Series Trust's registration statement, which are the same as 
those set forth in the VIT's registration statement and are similar to 
those suggested under Rule 17a-7 under the 1940 Act. No sales charge or 
fee of any kind will be charged to the Value Fund's shareholders in 
connection with the Merger.
    9. The Agreement and Declaration of Trust of the VIT, as amended, 
provides that the Trust's Board of Trustees must approve a sale of 
substantially all the assets of any series of the VIT and that the 
Board of Trustees may submit such matters to the shareholders of the 
VIT Fund, which it has done. AXA Rosenberg Group, as the sole 
shareholder of the VIT Fund, has indicated that it will approve the 
Merger, and therefore it is intended that there will be no proxy 
solicitation in connection therewith. Instead, the VIT has filed a 
registration and information statement with the Commission on Form N-14 
detailing the proposed Merger and intends to send the Prospectus/
Information Statement contained therein to AXA Rosenberg Group shortly 
after such registration and information statement becomes effective.
    10. The terms of the proposed Merger were presented to the Trusts' 
Board of Trustees at their meeting on December 4, 2000. At that time, 
the Board determined that the Merger is in the best interests of the 
shareholders of the Value Fund and the shareholder of the VIT Fund and 
that the interests of the Value Fund's shareholders will not be diluted 
thereby, in each case as required under rule 17a-8 under the 1940 Act.
    11. The Applicants believe that the Merger as proposed is 
consistent with the interests of the Value Fund's shareholders because 
the Funds have substantially identical investment objectives and 
strategies and because the injection of additional capital into the 
Value Fund is expected to increase economies of scale for its 
shareholders to the extent that certain of the Value Fund's expenses 
are fixed and do not vary with asset size.
    12. Applicants agree that the terms of and conditions to the 
issuance of an order granting the section 17(b) exemption requested by 
the Applicants are that:
    (a) The Trusts' Board of Trustees, including a majority of the 
Trusts' independent Trustees voting separately, has determined (1) that 
participation in the Merger is in the best interests of each of the VIT 
Fund and the Value Fund, and (2) that the interests of the Value Fund's 
shareholders will not be diluted as a result of the Merger;
    (b) All securities positions valued in connection with the Merger 
will be

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consistently valued in accordance with the Series Trust's valuation 
procedures, which are substantially identical to those of the VIT and 
similar to those suggested under Rule 17a-7 under the 1940 Act; and
    (c) The Merger will be reviewed during the following quarter by the 
Series Trust's Trustees, including the independent Trustees, for 
purposes of determining that the condition set forth in (b) above has 
been met.

    For the Commission, by the Division of Investment Management, 
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-8467 Filed 4-5-01; 8:45 am]
BILLING CODE 8010-01-M