Morgan Stanley Dean Witter of New York has proposed merging its smaller, poorer performing Mid-Cap Dividend Growth Fund into its $1.8 billion Mid-Cap Equity Fund, according to a preliminary proxy statement filed with the SEC Feb. 11. Mid-Cap Dividend Growth invests at least 65 percent of its assets in mid-cap companies that pay dividends. Mid-Cap Equity invests the same minimum percentage of assets in mid-cap growth stocks, according to the SEC filing.
The directors of Mid-Cap Dividend cited the fact that the fund was competing for assets against Mid-Cap Equity and was unlikely to increase in size as a reason for backing the proposed merger, according to the proxy statement.
Mid-Cap Dividend Growth's A shares ranked 184th out of 194 mid-cap value funds through Feb. 10, according to Lipper of Summit, N.J., the fund tracking and consulting firm. Mid-Cap Equity's A shares ranked 31st out of 362 funds in the multi-cap growth fund category, Lipper reported.
Mid-Cap Dividend had approximately $192 million in assets under management as of Dec. 31, according to Lipper.