ING simplifies offer to investors

PRESS RELEASE
Auckland, 28 May 2009

ING simplifies offer to investors in ING Diversified Yield Fund and
ING Regular Income Fund

• Offer will provide investors access to money now, and more choice, certainty and flexibility
• Investors to be offered special ANZ cash account for five years paying 8.3% per annum
• Offer packs to be mailed to investors shortly

ING New Zealand today announced that it has finalised the details of the offer to investors in its two suspended funds, the ING Diversified Yield Fund (DYF) and the ING Regular Income Fund (RIF).

Helen Troup, ING New Zealand Chief Executive Officer, said investors had waited a long time, and the company was now ready for the formal offer to be put to investors in the two suspended funds, which has been modified from the proposal previously announced on 25 February 2009.

“Since announcing our previous proposal, we have responded to the feedback from investors and advisers that five years was simply too long to wait for access to their money. The most recent assessment of the funds indicated that the future value of the units in the funds over the next five years is likely to remain lower than the offer prices.

“We have therefore found a way to provide investors with the bulk of their money back in five years’ time, without requiring them to be locked into the funds when we believe there is likely to be no upside above the offer prices during that period. The proposal is now simpler, more flexible and it enables investors to decide what option is best for them, regardless of what other investors may decide.

“Our shareholders, ANZ National Bank Limited and ING Group, have stepped up and will commit more than $400 million to enable each investor to have a simple choice: to receive a payment now of around three times the manager’s current estimated value of their investment, or to realise even more than this by selling their units and investing their payment into an on-call ANZ Cash Account paying 8.3% per annum for five years. I am not aware of any other shareholder in New Zealand that has stepped up to provide this level of financial support when faced with similar circumstances.

“As a condition of accepting the offer, investors will be required to agree not to start or continue with any claims or legal action related to the funds. We believe that’s a reasonable term as part of this very good offer,” said Ms Troup.

Under the Cash Out Option, which has not changed, investors will be able to sell their units immediately for 60 cents per unit for DYF and 62 cents per unit for RIF. Under the modified Five Year Option, the proceeds from the sale of their units will be invested into a high interest ANZ Cash Account, and investors will have the ability to withdraw some or all of the money at any time in the five year period.

The changes to the Five Year Option will result in all investors gaining added flexibility and some investors potentially being able to receive higher returns (under current tax rates) than the previous proposal. Some investors will however receive a lower after-tax return depending on their tax rate and whether they withdraw any money earlier.

Investors can also choose not to accept the offer and can remain in the funds. If investors choose to do this, they will retain their rights in relation to the funds and will accept the market risks that go along with this decision.

Ms Troup said now that ING has been able to announce the detail of the upcoming full and final offer, its focus would be on ensuring investors have a full understanding of the options available to them through the offer pack, including an independent expert report, as well as investor briefings and access to a financial expert service.

“Investors will need to make whichever decision is best for them in light of their own individual circumstances. The offer is now simpler, so the offer will no longer be dependent on a collective unitholder vote,”concluded Ms Troup.

The offer packs, which will contain full details of the offer and acceptance forms, will shortly be printed and will be with investors during the week commencing 8 June.

ING Full Media Release 28May (pdf)

The Offer A Summary (pdf)

ENDS

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