Transamerica Funds
Transamerica ClearTrack 2015
Transamerica ClearTrack 2020
Transamerica ClearTrack 2025
Transamerica ClearTrack 2030
Transamerica ClearTrack 2035
Transamerica ClearTrack 2040
Transamerica ClearTrack 2045
Transamerica ClearTrack 2050
Transamerica ClearTrack 2055
Transamerica ClearTrack 2060
Transamerica ClearTrack Retirement Income
Transamerica Dynamic Income
TRANSAMERICA SERIES TRUST
Transamerica Legg Mason Dynamic Allocation - Balanced VP
Transamerica Legg Mason Dynamic Allocation - Growth VP
Transamerica QS Investors Active Asset Allocation - Conservative VP
Transamerica QS Investors Active Asset Allocation - Moderate VP
Transamerica QS Investors Active Asset Allocation - Moderate Growth VP
1801 California Street, Suite 5200
Denver, CO 80202
NOTICE OF INTERNET AVAILABILITY OF JOINT INFORMATION STATEMENT
This communication presents only an overview of the more complete Joint Information Statement that is available to you on the internet relating to Transamerica ClearTrack 2015, Transamerica ClearTrack 2020, Transamerica ClearTrack 2025, Transamerica ClearTrack 2030, Transamerica ClearTrack 2035, Transamerica ClearTrack 2040, Transamerica ClearTrack 2045, Transamerica ClearTrack 2050, Transamerica ClearTrack 2055, Transamerica ClearTrack 2060, Transamerica ClearTrack Retirement Income, Transamerica Dynamic Income, Transamerica Legg Mason Dynamic Allocation – Balanced VP, Transamerica Legg Mason Dynamic Allocation – Growth VP, Transamerica QS Investors Active Asset Allocation – Conservative VP, Transamerica QS Investors Active Asset Allocation – Moderate VP and Transamerica QS Investors Active Asset Allocation – Moderated Growth VP (each a “Fund” and collectively, the “Funds”). We encourage you to access and review all of the important information contained in the Joint Information Statement.
The following material is available for view: Joint Information Statement
The Joint Information Statement is to inform investors that on June 17-18, 2020, the Boards of Trustees (the “Board”) of Transamerica Funds and Transamerica Series Trust (collectively, the “Trusts”) approved new sub-advisory agreements between Transamerica Asset Management, Inc. (“TAM”), the Funds’ investment manager, and QS Investors, LLC (“QS Investors”), the Funds’ sub-adviser, (the “New Sub-Advisory Agreements”) with respect to the Funds and a new sub-sub-advisory agreement between QS Investors and Western Asset Management Company (“Western Asset”) with respect to Transamerica Legg Mason Dynamic Allocation – Balanced VP and Transamerica Legg Mason Dynamic Allocation - Growth VP (the “Dynamic Allocation Funds”) (the “New Sub-Sub-Advisory Agreement” and together with the New Sub-Advisory Agreements, the “New Agreements”) to take effect upon the closing of Franklin Resources, Inc.’s acquisition of Legg Mason Inc., the ultimate parent entity of QS Investors and Western Asset (the “Transaction”). The Transaction closed on July 31, 2020. This Transaction constituted an “assignment,” as that term is defined in the Investment Company Act of 1940, as amended, (the “1940 Act”) of the prior sub-advisory agreements with QS Investors with respect to the Funds and the prior sub-sub-advisory agreement between QS Investors and Western Asset with respect to the Dynamic Allocation Funds, and resulted in the automatic termination of those prior agreements. In approving the New Agreements, the Board considered, among other things, that the Transaction is not expected to result in any diminution in the nature, extent and quality of sub-advisory and sub-sub-advisory services provided to the Funds. TAM continues to serve as each Fund’s investment manager. The enclosed Joint Information Statement provides information regarding the New Agreements.
The Trusts and TAM have received an exemptive order (the “Order”) from the U.S. Securities and Exchange Commission that permits TAM to enter into and materially amend sub-advisory agreements (with non-affiliated entities) with the approval of the Trusts’ Board of Trustees, including a majority of Board Members who are not parties to the agreement and are not interested persons, as defined in the 1940 Act, of the parties to the agreement, without obtaining investor approval. The Order instead requires that an Information Statement be sent to you. In lieu of physical delivery of the Joint Information Statement, the Trusts will make the Joint Information Statement available to you online.
The Joint Information Statement will be available on the Transamerica website until at least April 30, 2021 at https://www.transamerica.com/media/qs-investors-control-change_tcm145-121780.pdf. A paper or email copy of the Joint Information Statement may be obtained, without charge, by contacting the Transamerica Funds at 1-888-233-4339 or TST Funds at 1-800-851-9777.
If you want to receive a paper or e-mail copy of the Joint Information Statement, you must request one. There is no charge to you for requesting a copy.
Transamerica Levin Large Cap Value VP
Effective on or about December 1, 2020, Transamerica Asset Management, Inc. (“TAM”) will terminate its investment sub-advisory agreement with Levin Easterly Partners LLC (“Levin”) with respect to Transamerica Levin Large Cap Value VP (the “portfolio”) and will enter into a new investment sub-advisory agreement with Rothschild & Co Asset Management US Inc. (“Rothschild”) with respect to the portfolio. An information statement will be made available to investors which will provide certain information about the new sub-adviser and the terms of the new sub-advisory agreement.
In connection with the change in sub-adviser from Levin to Rothschild, the following will also change with respect to the portfolio: (i) the portfolio will be renamed; (ii) the portfolio’s principal investment strategies will be revised; and (iii) the portfolio will have lower management fee and sub-advisory fee schedules. These changes are described below.
TAM will continue to serve as the portfolio’s investment manager.
Effective on or about December 1, 2020, Transamerica Levin Large Cap Value VP will be renamed Transamerica Rothschild & Co Large Cap Value VP and the following information will supplement and supersede any contrary information contained in the Prospectus, Summary Prospectus and Statement of Additional Information concerning the portfolio:
The portfolio will change its management fee schedule as described below.
TAM will receive compensation from the portfolio, calculated daily and paid monthly, at the annual rates (expressed as a percentage of the portfolio’s average daily net assets) indicated below:
First $1 billion......................................................................................................... 0.594%
Over $1 billion up to $2 billion............................................................................ 0.58%
Over $2 billion up to $3 billion............................................................................ 0.56%
In excess of $3 billion............................................................................................ 0.54%
The “Annual Fund Operating Expenses” table included in the “Fees and Expenses” section of the Prospectus and Summary Prospectus is deleted in its entirety and replaced with the following:
|
Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) |
||
|
Class |
Initial |
Service |
|
Management fees1 |
0.59% |
0.59% |
|
Distribution and service (12b-1) fees |
0.00% |
0.25% |
|
Other expenses2 |
0.58% |
0.58% |
|
Total annual fund operating expenses |
1.17% |
1.42% |
|
Fee waiver and/or expense reimbursement3 |
0.22% |
0.22% |
|
Total annual fund operating expenses after fee waiver and/or expense reimbursement |
0.95% |
1.20% |
1 Management fees have been restated to reflect a reduction in management fees effective December 1, 2020.
2 Other expenses for Initial Class shares are based on estimates for the current fiscal year.
3 Contractual arrangements have been made with the portfolio’s investment manager, Transamerica Asset Management, Inc. (“TAM”), through May 1, 2021 to waive fees and/or reimburse portfolio expenses to the extent that total annual fund operating expenses exceed 0.95% for Initial Class shares and 1.20% for Service Class shares, excluding, as applicable, acquired fund fees and expenses, interest, taxes, brokerage commissions, dividend and interest expenses on securities sold short, extraordinary expenses and other expenses not incurred in the ordinary course of the portfolio’s business. These arrangements cannot be terminated prior to May 1, 2021 without the Board of Trustees’ consent. TAM is permitted to recapture amounts waived and/or reimbursed to a class during any of the 36 months from the date on which TAM waived fees and/or reimbursed expenses for the class. A class may reimburse TAM only if such reimbursement does not cause, on any particular business day of the portfolio, the class’s total annual operating expenses (after the reimbursement is taken into account) to exceed the applicable limits described above or any other lower limit then in effect.
The “Example” table included in the Prospectus and Summary Prospectus is deleted in its entirety and replaced with the following:
Example: This Example is intended to help you compare the cost of investing in the portfolio with the cost of investing in other mutual funds.
The Example assumes that you invest $10,000 in the portfolio for the time periods indicated and then redeem all shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the portfolio’s operating expenses remain the same. The Example does not reflect charges that are, or may be, imposed under your variable life insurance policy or variable annuity contract. If such charges were reflected, costs would be higher. Only the 1 year dollar amount shown below reflects TAM’s agreement to waive fees and/or reimburse fund expenses. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
|
|
1 year |
3 years |
5 years |
10 years |
|
Initial Class |
$97 |
$350 |
$622 |
$1,401 |
|
Service Class |
$122 |
$428 |
$755 |
$1,683 |
The following information will be added alphabetically to the sub-section titled “Recent Management Fee Changes” under the heading “Shareholder Information - Investment Manager” in the Prospectus:
Transamerica Rothschild & Co Large Cap Value VP: Effective December 1, 2020, the management fee is 0.594% of the first
$1 billion; 0.58% over $1 billion up to $2 billion; 0.56% over $2 billion up to $3 billion; and 0.54% in excess of $3 billion in average daily net assets. Prior to December 1, 2020, the management fee was 0.65% of the first $750 million; 0.62% over $750 million up to $1 billion; 0.60% over $1 billion up to $2 billion; 0.59% over $2 billion up to $3 billion; and 0.58% in excess of
$3 billion in average daily net assets.
PRINCIPAL INVESTMENT STRATEGIES:
The portfolio’s principal investment strategies will be as follows:
Under normal circumstances, the portfolio will invest at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of large cap companies. The portfolio considers large cap companies to be companies with capitalizations within the range of companies included in the Russell 1000® Index1. As of December 31, 2019, the market capitalization range of the Russell 1000® Index was between approximately $823.8 million and $1,287.6 billion. The portfolio’s sub-adviser, Rothschild & Co Asset Management US Inc. (the “sub-adviser”), normally focuses primarily on companies with market capitalizations greater than $5 billion. The portfolio typically holds between 35 and 50 positions. The portfolio’s benchmark is the Russell 1000® Value Index.
The portfolio will employ a relative value approach, combining a quantitative screening tool to identify attractive candidate securities with a bottom-up, fundamental research process to select and weight individual securities. The sub-adviser invests in securities it believes to be attractively valued with the potential to exceed investor expectations and may sell securities that no longer meet the investment criteria of the portfolio management team.
The portfolio will generally invest in companies across a variety of industries and sectors. Valuation is assessed on both a relative and absolute basis. The portfolio will invest primarily in common stock and depositary receipts. The portfolio may invest up to 20% of its assets in non-U.S. securities. The portfolio considers non-U.S. securities to include issuers organized or located outside the U.S. and trade primarily in a market located outside the U.S. The portfolio may invest up to 20% of its net assets in small and/or medium capitalization companies.
1 “Russell®” and other service marks and trademarks related to the Russell indexes are trademarks of the London Stock Exchange Group companies.
The portfolio’s sub-adviser will be as follows:
Rothschild & Co Asset Management US Inc. has been registered as an investment adviser since 1970. As of June 30, 2020, Rothschild & Co Asset Management US Inc. had approximately $7.4 billion in total assets under management. Rothschild & Co Asset Management US Inc.’s principal business address is 1251 Avenue of the Americas, New York, NY.
The portfolio’s portfolio managers will be as follows:
|
Name |
Sub-Adviser |
Positions Over Past Five Years |
|
Paul Roukis, CFA |
Rothschild & Co Asset Management US Inc. |
Portfolio Manager of the portfolio since 2020; Managing Director and Co-Portfolio Manager with Rothschild & Co Asset Management US Inc. since 2005 |
|
Jeff Agne |
Rothschild & Co Asset Management US Inc. |
Portfolio Manager of the portfolio since 2020; Managing Director and Co-Portfolio Manager with Rothschild & Co Asset Management US Inc. since 2015 |
The following information revises the corresponding information appearing in the table contained in the “Investment Manager Compensation” sub-section of the Statement of Additional Information under the heading “Investment Management and Other Services – The Investment Manager”:
|
Fund Name |
Percentage of Average Daily Net Assets |
|
Transamerica Rothschild & Co Large Cap Value VP |
First $1 billion................................................. 0.594% Over $1 billion up to $2 billion.................... 0.58% Over $2 billion up to $3 billion.................... 0.56% In excess of $3 billion.................................... 0.54% |
The following information revises the corresponding information appearing in the table contained in the “Sub-Advisory Fees” sub-section of the Statement of Additional Information under the heading “Investment Management and Other Services – Sub-Advisers”:
|
Fund |
Sub-Adviser |
Sub-Advisory Fees |
|
Transamerica Rothschild & Co Large Cap Value VP |
Rothschild & Co Asset Management US Inc. (11) |
0.144% of the first $1 billion 0.13% over $1 billion up to $3 billion 0.12% in excess of $3 billion |
(11) The average daily net assets for the purpose of calculating sub-advisory fees will be determined on a combined basis with Transamerica Large Cap Value.
Investors Should Retain this Supplement for Future Reference
Supplement to the Currently Effective Prospectus
The following replaces the existing “Legal Proceedings” disclosure in the “Shareholder Information” section of the Prospectus:
On August 27, 2018, Transamerica Asset Management, Inc. (“TAM”), Aegon USA Investment Management, LLC (“AUIM”) and Transamerica Capital, Inc. (“TCI”) reached a settlement with the Securities and Exchange Commission (the “SEC”) that resolved an investigation into asset allocation models and volatility overlays utilized by AUIM when it served as sub-adviser to certain Transamerica-sponsored mutual funds, and related disclosures. TAM and TCI serve as investment manager and principal underwriter, respectively, to Transamerica-sponsored mutual funds. TCI also serves as the principal underwriter to the variable life insurance and annuity products through which certain Transamerica-sponsored mutual funds are offered. AUIM, an affiliate of TAM and TCI, serves as sub-adviser to a number of Transamerica-sponsored mutual funds.
The SEC’s order instituting administrative and cease-and-desist proceedings (the “Order”) pertains to events that occurred during the period between July 2011 and June 2015, and, among other things, the operation and/or implementation of an asset allocation model utilized by AUIM when it served as sub-adviser to certain Transamerica tactical funds and asset allocation funds, the designation of the portfolio manager for certain of these funds as well as the operation and/or implementation of volatility overlays utilized by AUIM when it served as sub- adviser to the asset allocation funds. The Order also states that the parties failed to make appropriate disclosures regarding these matters, including in marketing materials, and failed to have adequate compliance policies and procedures. The tactical funds are Transamerica Dynamic Income (formerly, Transamerica Tactical Income), Transamerica Dynamic Allocation (formerly, Transamerica Tactical Rotation) and Transamerica Dynamic Allocation II (formerly, Transamerica Tactical Allocation, and now reorganized into Transamerica Dynamic Allocation). The asset allocation funds are Transamerica Managed Risk – Conservative ETF VP (formerly, Transamerica Vanguard ETF Portfolio – Conservative VP and Transamerica Index 35 VP), Transamerica Managed Risk – Balanced ETF VP (formerly, Transamerica Vanguard ETF Portfolio – Balanced VP and Transamerica Index 50 VP), Transamerica Managed Risk – Growth ETF VP (formerly, Transamerica Vanguard ETF Portfolio – Growth VP and Transamerica Index 75 VP), Transamerica QS Investors Active Asset Allocation – Conservative VP (formerly, Transamerica Aegon Active Asset Allocation – Conservative VP), Transamerica QS Investors Active Asset Allocation – Moderate VP (formerly, Transamerica Aegon Active Asset Allocation – Moderate VP) and Transamerica QS Investors Active Asset Allocation – Moderate Growth VP (formerly, Transamerica Aegon Active Asset Allocation – Moderate Growth VP). AUIM ceased to serve as sub-adviser to the Transamerica tactical funds on April 30, 2015 and to the Transamerica asset allocation funds on June 30, 2015.
Under the terms of the Order, AUIM, TAM and TCI were censured, and agreed, without admitting or denying the findings in the Order, to cease and desist from committing or causing any violations of certain statutory provisions and SEC rules. AUIM agreed to pay civil penalties of $21,000,000, $24,599,896 in disgorgement and $3,682,195 in prejudgment interest. TAM agreed to pay civil penalties of $10,500,000, $15,000,000 in disgorgement and $2,235,765 in prejudgment interest. TCI agreed to pay civil penalties of $4,000,000, $12,000,000 in disgorgement and $1,826,022 in prejudgment interest. The amounts paid in disgorgement, prejudgment interest and civil penalties will be deposited into a Fair Fund for distribution to affected investors. Affected investors are those who purchased or held the relevant mutual funds, variable life insurance and annuity investment portfolios and separately managed account strategies during the period between July 2011 and June 2015. The Order states that these investors are to receive from the Fair Fund the pro rata fees and commissions paid by them during that period, subject to any de minimis threshold.
In accepting the settlement, the SEC considered the substantial cooperation and remedial efforts of AUIM, TAM and TCI. In the Order, the SEC acknowledged that, after the start of the SEC staff’s investigation but before the settlement, AUIM, TAM and TCI had voluntarily retained an independent compliance consultant to conduct a comprehensive review of certain compliance policies and procedures, internal controls and related procedures, and that AUIM, TAM and TCI had received the consultant’s written findings and implemented the consultant’s proposed changes. The SEC also acknowledged that, in advance of receiving written findings and recommendations from the independent compliance consultant, AUIM, TAM and TCI had already begun making revisions and improvements to their compliance policies and procedures. The SEC also considered that AUIM, TAM and TCI have retained the independent compliance consultant for further reviews through the completion of the consultant’s follow-up review for fiscal year 2019.
The settlement does not impose any restrictions on the business or continued ability of AUIM, TAM or TCI to serve the funds.
Transamerica Financial Advisors, LLC (“TFA”), which serves as an intermediary for the Transamerica-sponsored mutual funds, also was a party to the settlement. The findings in the Order with respect to TFA are unrelated to the mutual funds.
The foregoing is only a brief summary of the Order. A copy of the Order is available on the SEC’s website at https://www.sec.gov.
The funds are affected by many factors and risks: for example, the risk that the sub-advisers’ judgments and investment decisions, and methods, tools, resources, information, models and analyses utilized in making investment decisions, are incorrect or flawed, do not produce the desired results, and cause the funds to lose value. See “Principal Risks” in the prospectus.
Investors Should Retain this Supplement for Future Reference
August 27, 2018
2
The Board of Trustees has approved the termination of Barrow, Hanley, Mewhinney & Strauss, LLC as sub-adviser to Transamerica Barrow Hanley Dividend Focused VP (the "portfolio"). The Board has also approved a new investment sub-advisory agreement with Aegon Asset Management UK plc ("AAM"), an affiliate of Transamerica Asset Management, Inc. ("TAM"), the portfolio's investment manager, subject to approval by the portfolio's investors.
Because AAM is an affiliate of TAM, the new investment sub-advisory agreement between TAM and AAM with respect to the portfolio must be approved by investors. A proxy statement describing the details of the proposed change in sub-adviser is expected to be mailed to portfolio investors in September 2020. If approved by portfolio investors, it is anticipated that the change in sub-adviser would occur on or about December 1, 2020. At that time, among other things, the portfolio is expected to be renamed Transamerica Aegon Sustainable Equity Income VP and certain changes would be made to the portfolio's principal investment strategies and principal risks.
Investors Should Retain this Supplement for Future Reference
* * *
Transamerica Greystone International Growth VP
Transamerica U.S. Equity Index VP
Transamerica International Equity Index VP
Effective May 1, 2020, the names of each of Transamerica Greystone International Growth VP, Transamerica U.S. Equity Index VP and Transamerica International Equity Index VP (each, a “Portfolio” and collectively, the “Portfolios”) will change. Each Portfolio’s investment objectives, principal investment strategies, principal risks, portfolio managers, investment manager, sub-adviser and fee schedules will remain the same.
The Portfolios will be renamed as set forth in the table below and the following information will supplement and supersede any contrary information contained in the Prospectus, Summary Prospectuses and Statement of Additional Information concerning the Portfolios.
Current Name New Name (effective May 1, 2020)
|
Transamerica Greystone International Growth VP |
|
Transamerica International Growth VP |
|
Transamerica U.S. Equity Index VP |
|
Transamerica S&P 500 Index VP |
|
Transamerica International Equity Index VP |
Transamerica MSCI EAFE Index VP |
|
Investors Should Retain this Supplement for Future Reference
TRANSAMERICA SERIES TRUST
Transamerica BlackRock Global Allocation VP
Supplement to the Currently Effective Prospectus,
Summary Prospectus
and Statement of Additional Information
* * *
Effective on or about May 1, 2020, Transamerica Asset Management, Inc. (“TAM”) will terminate its investment sub-advisory agreement with BlackRock Investment Management, LLC (“BlackRock”) with respect to Transamerica BlackRock Global Allocation VP (the “portfolio”) and will enter into a new investment sub-advisory agreement with Morgan Stanley Investment Management Inc. (“Morgan Stanley”) with respect to the portfolio. An information statement will be made available to investors which will provide certain information about the new sub-adviser and the terms of the new sub‑advisory agreement.
In connection with the change in sub-adviser from BlackRock to Morgan Stanley, the following will also change with respect to the portfolio: (i) the portfolio will be renamed; (ii) the portfolio’s investment objective will change; (iii) the portfolio’s principal investment strategies and principal risks will be revised; (iv) the portfolio will have lower management fee and sub-advisory fee schedules; and the portfolio will change its primary and secondary benchmark indices. These changes are described below.
TAM will continue to serve as the portfolio’s investment manager.
* * *
Effective on or about May 1, 2020, Transamerica BlackRock Global Allocation VP will be renamed Transamerica Morgan Stanley Global Allocation VP and the following information will supplement and supersede any contrary information contained in the Prospectus, Summary Prospectus and Statement of Additional Information concerning the portfolio:
INVESTMENT OBJECTIVE:
The portfolio’s investment objective will be as follows:
Seeks high total return.
PRINCIPAL INVESTMENT STRATEGIES:
The portfolio’s principal investment strategies will be as follows:
Under normal circumstances, the portfolio’s sub-adviser, Morgan Stanley Investment Management, Inc. (the “sub-adviser”), seeks to achieve the portfolio’s investment objective by investing primarily in a blend of equity and fixed-income securities of U.S. and non-U.S. issuers. Equity securities may include common and preferred stocks, depositary receipts, convertible securities, equity-linked securities, real estate investment trusts (“REITs”), rights and warrants to purchase equity securities and limited partnership interests. Fixed-income securities may include mortgage-related or mortgage-backed securities, floating rate securities, inflation-linked fixed-income securities, securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities, securities issued or guaranteed by non-U.S. governments, their agencies or instrumentalities, corporate bonds and notes issued by U.S. and non-U.S. entities.
The sub-adviser will utilize a top-down investment approach that focuses on asset class, sector, region, country and currency and thematic allocations. The sub-adviser’s investment and allocation decisions for the portfolio will be based upon the sub-adviser’s evaluations, analyses and judgments, taking into account results of its fundamental market research and recommendations generated by the sub-adviser’s quantitative inputs. The sub-adviser’s research process generally focuses on the following factors across asset classes: 1) valuation (both relative and absolute), 2) dynamics, including earnings revisions, interest rate policy and inflation expectations and 3) technicals, such as investor flows and sentiment. The portfolio may invest in any country, including developing or emerging market countries. The portfolio’s investments may be U.S. and non-U.S. dollar denominated. In determining whether to sell a security, the sub-adviser considers a number of factors, including changes in capital appreciation potential, or the overall assessment of asset class, sector, region, country, and currency and thematic allocation shifts.
The portfolio may invest a portion of its assets in below investment grade fixed-income securities. The mortgage-backed securities in which the portfolio may invest include mortgage pass-through securities that represent a participation interest in a pool of mortgage loans originated by U.S. governmental or private lenders such as banks.
The portfolio may, but is not required to, use derivative instruments for a variety of purposes, including hedging, risk management, portfolio construction, capital appreciation, or to earn income. The portfolio’s use of derivatives may involve the purchase and sale of derivative instruments such as futures, options, swaps and structured investments (including commodity-linked notes), and other related instruments and techniques. The portfolio may utilize foreign currency forward exchange contracts, which are also derivatives, in connection with its investments in foreign securities. Derivative instruments used by the portfolio will be counted toward the portfolio’s exposure to the types of securities listed above to the extent they have economic characteristics similar to such securities.
The portfolio may, consistent with its principal investment strategies, invest up to 25% of its total assets in a wholly-owned subsidiary of the portfolio organized as a company under the laws of the Cayman Islands (the “Subsidiary”). The Subsidiary may invest, directly or indirectly through the use of derivatives, in securities, commodities, commodity-related instruments and other investments, primarily futures, swaps and notes. The Subsidiary has the same investment objective as the portfolio and is managed by Transamerica Asset Management, Inc. and sub-advised by the sub-adviser.
Investments in the Subsidiary are intended to provide the portfolio with exposure to commodities markets within the limitations of the federal tax requirements that apply to the portfolio. The Subsidiary primarily obtains its commodity exposure by investing in commodity-linked derivative instruments, which may include, but are not limited to, total return swaps, commodity (U.S. or foreign) futures and commodity-linked notes. The Subsidiary may also invest in other instruments, including fixed-income securities, either as investments or to serve as margin or collateral for its swap positions, and foreign currency transactions (including forward contracts).
The portfolio may invest up to 10% of its assets in China A-shares (equity securities of Chinese companies) listed and traded on Chinese stock exchanges such as the Shanghai Stock Exchange or the Shenzhen Stock Exchange.
PRINCIPAL RISKS:
The portfolio will no longer be subject to “Convertible Securities” risk, “Distressed or Defaulted Securities” risk, “Growth Stocks” risk, “Loans” risk, “Money Market Funds” risk, “Precious Metals-Related Securities” risk, “Preferred Stock” risk, “Short Sales” risk, “Structured Instruments” risk or “Warrants and Rights” risk as principal risks. The portfolio will be subject to the following additional principal risk:
U.S. Government and Agency Obligations – Government agency obligations have different levels of credit support and, therefore, different degrees of credit risk. Securities issued by agencies and instrumentalities of the U.S. government that are supported by the full faith and credit of the U.S. government generally present a lesser degree of credit risk than securities issued by agencies and instrumentalities sponsored by the U.S. government that are supported only by the issuer’s right to borrow from the U.S. Treasury and securities issued by agencies and instrumentalities sponsored by the U.S. government that are supported only by the credit of the issuing agencies. A security backed by the “full faith and credit” of the U.S. government is guaranteed only as to its stated interest rate and face value at maturity, not its current market price.
SUB-ADVISER:
The portfolio’s sub-adviser will be as follows:
Morgan Stanley Investment Management Inc., a subsidiary of Morgan Stanley, has been a registered investment adviser since 1981. As of September 30, 2019, Morgan Stanley Investment Management Inc. has approximately $507 billion in total assets under management. Morgan Stanley Investment Management Inc.’s principal business address is 522 Fifth Avenue, New York, NY 10036.
PORTFOLIO MANAGER:
The portfolio’s portfolio managers will be as follows:
|
Name |
Sub-Adviser |
Positions Over Past Five Years |
|
|
Cyril Moullè-Berteaux |
Morgan Stanley Investment Management Inc. |
Lead Portfolio Manager of the portfolio since 2020; associated with Morgan Stanley Investment Management Inc. in an investment management capacity since 2011, and from 1995 to 2003; Managing Director; Head of the Global Multi-Asset team; Founding Partner and Portfolio Manager at Traxis Partners from 2003 to 2011 |
|
|
Mark Bavoso |
Morgan Stanley Investment Management Inc. |
Portfolio Manager of the portfolio since 2020; associated with Morgan Stanley Investment Management Inc. in an investment management capacity since 1986; Managing Director; Sr. Portfolio Manager of the Global Multi-Asset team |
|
|
Sergei Parmenov |
Morgan Stanley Investment Management Inc. |
Portfolio Manager of the portfolio since 2020; associated with Morgan Stanley Investment Management Inc. in an investment management capacity since 2011, and from 1996 to 2003; Managing Director; Executive Director of the Global Multi-Asset team; Analyst and Portfolio Manager at Traxis Partners from 2003 to 2008 |
|
MANAGEMENT FEES:
The portfolio’s management fee schedule will be as follows:
TAM will receive compensation from the portfolio, calculated daily and paid monthly, at the annual rates (expressed as a percentage of the portfolio’s average daily net assets) indicated below:
0.66% of the first $500 million
0.65% over $500 million up to $750 million
0.64% over $750 million up to $1 billion
0.63% over $1 billion up to $3 billion
0.59% in excess of $3 billion
SUB-ADVISORY FEES:
The portfolio’s sub-advisory fee schedule will be as follows:
Morgan Stanley will receive monthly compensation from TAM at the annual rate of a specified percentage, indicated below, of the portfolio’s average daily net assets:
|
Fund |
Sub-Adviser |
Sub-Advisory Fees |
|
Transamerica Morgan Stanley Global Allocation VP
|
Morgan Stanley Investment Management Inc. |
0.27% of the first $500 million 0.26% over $500 million up to $1 billion 0.25% over $1 billion up to $3 billion 0.21% in excess of $3 billion |
* * *
BENCHMARKS:
The portfolio’s benchmarks will be as follows:
Primary benchmark = MSCI ACWI Index
Secondary benchmark = Transamerica Morgan Stanley Global Allocation VP Blended Benchmark (consists of the MSCI ACWI Index (60%) and Bloomberg Barclays Global Aggregate Index (40%))
* * *
Investors Should Retain this Supplement for Future Reference
December 9, 2019
TRANSAMERICA SERIES TRUST
Supplement to the Currently Effective Prospectus
and Statement of Additional Information
* * *
Effective October 1, 2020, the third paragraph of the “Investment Manager” sub-section under the “Shareholder Information” section of the Prospectus is deleted in its entirety and replaced with the following:
TAM is directly owned by Transamerica Life Insurance Company (“TLIC”) (77%) and AUSA Holding, LLC (“AUSA”) (23%), both of which are indirect, wholly owned subsidiaries of Aegon NV. TLIC is owned by Commonwealth General Corporation (“Commonwealth”). Commonwealth and AUSA are wholly owned by Transamerica Corporation (DE). Transamerica Corporation (DE) is wholly owned by The Aegon Trust, which is wholly owned by Aegon International B.V., which is wholly owned by Aegon NV, a Netherlands corporation, and a publicly traded international insurance group.
* * *
Effective September 30, 2020, the following is added to the “Shareholder Information” section of the Prospectus immediately after the “Investment Manager” sub-section:
Legal Proceedings
On September 30, 2020, Transamerica Asset Management, Inc. (“TAM”), the investment manager of the portfolios, entered into a settlement with the Securities and Exchange Commission (the “SEC”) relating to expense recaptures. The recaptures at issue, which TAM self-reported to the SEC, involved amounts previously voluntarily waived and/or reimbursed to four money market funds to prevent the funds from experiencing a negative yield. In some cases recaptures under the voluntary yield waiver arrangements exceeded contractual expense limits. The recaptured amounts were not reflected in the funds’ prospectus fee tables. The funds involved were Transamerica Government Money Market, Transamerica BlackRock Government Money Market VP, Transamerica Partners Government Money Market and Transamerica Partners Institutional Government Money Market. The two Transamerica Partners Government Money Market funds reorganized into Transamerica Government Money Market in October of 2017.
Under the settlement order, TAM agreed to pay affected fund investors approximately $5.3 million in disgorgement and approximately $690,000 in prejudgment interest. These amounts represent expenses incurred above the applicable expense limit (plus interest). TAM was also censured and ordered to cease and desist from committing or causing any violations of certain statutory provisions and SEC rules. The settlement order imposes no civil penalty on TAM based upon TAM having self-reported the matter, the prompt remedial steps taken by TAM, and TAM’s cooperation in the SEC staff’s investigation. The settlement order does not affect TAM’s ability to manage the portfolios.
The foregoing is only a brief summary of the settlement order. A copy of the settlement order is available on the SEC’s website at https://www.sec.gov.
* * *
Effective October 1, 2020, the fourth paragraph of the “Investment Manager” sub-section under the “Investment Management and Other Services” section of the Statement of Additional Information is deleted in its entirety and replaced with the following:
TAM is directly owned by Transamerica Life Insurance Company (“TLIC”) (77%) and AUSA Holding, LLC (“AUSA”) (23%), both of which are indirect, wholly owned subsidiaries of Aegon NV. TLIC is owned by Commonwealth General Corporation (“Commonwealth”). Commonwealth and AUSA are wholly owned by Transamerica Corporation (DE), a financial services holding company whose primary emphasis is on life and health insurance, and annuity and investment products. Transamerica Corporation (DE) is wholly owned by The Aegon Trust, which is wholly owned by Aegon International B.V., which is wholly owned by Aegon NV, a Netherlands corporation, and a publicly traded international insurance group.
* * *
Investors Should Retain this Supplement for Future Reference
September 30, 2020
Transamerica Barrow Hanley Dividend Focused VP
* * *
Effective
December 1, 2020, Transamerica Barrow Hanley Dividend Focused VP will be renamed
Transamerica Aegon Sustainable
Equity Income VP (the “portfolio”) and will no longer be offered through the
prospectus dated May 1, 2020, as supplemented. The
portfolio will be offered through a separate stand-alone prospectus and summary
prospectus dated December 1, 2020.
Investors Should Retain this Supplement for Future Reference
Transamerica
BlackRock Global Allocation Managed Risk - Growth VP
Transamerica Multi-Manager Alternative Strategies VP
* * *
Transamerica BlackRock Global Allocation Managed Risk - Growth VP
The Board of Trustees of Transamerica Series Trust has approved the liquidation of Transamerica BlackRock Global Allocation Managed Risk - Growth VP (the “portfolio”).
The liquidation is subject to investor approval. Proxy materials describing the liquidation are expected to be mailed to investors in the first quarter of 2020. If investor approval is obtained, it is expected that the liquidation will take place on or about April 30, 2020. Effective on or about February 14, 2020, the portfolio will be closed to all investments.
If the liquidation is approved by investors and you have not transferred your account value out of the portfolio to another allocation option by the liquidation date, then upon the liquidation of the portfolio, your liquidation proceeds will be exchanged to the corresponding share class of Transamerica BlackRock Government Money Market VP.
Transamerica Multi-Manager Alternative Strategies VP
The Board of Trustees has approved the liquidation of Transamerica Multi-Manager Alternative Strategies VP (the “portfolio”).
The liquidation is subject to investor approval. Proxy materials describing the liquidation are expected to be mailed to investors in the first quarter of 2020. If investor approval is obtained, it is expected that the liquidation will take place on or about April 30, 2020. Effective on or about February 14, 2020, the portfolio will be closed to all investments.
If the liquidation is approved by investors and you have not transferred your account value out of the portfolio to another allocation option by the liquidation date, then upon the liquidation of the portfolio, your liquidation proceeds will be exchanged to the corresponding share class of Transamerica BlackRock Government Money Market VP.
Investors Should Retain this Supplement for Future Reference
Transamerica S&P 500 Index VP
* * *
Effective on December 1, 2020, the following information supplements and supersedes any contrary information contained in the Prospectus and Summary Prospectus concerning Transamerica S&P 500 Index VP (the “portfolio”):
The “Annual Fund Operating Expenses” table included in the “Fees and Expenses” section of the Prospectus and Summary Prospectus is deleted in its entirety and replaced with the following:
|
Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) |
||
|
Class |
Initial |
Service |
|
Management fees |
0.08% |
0.08% |
|
Distribution and service (12b-1) fees |
0.00%1 |
0.25% |
|
Other expenses |
0.05% |
0.11% |
|
Total annual fund operating expenses |
0.13% |
0.44% |
|
Fee waiver and/or expense reimbursement2 |
0.00% |
0.05% |
|
Total annual fund operating expenses after fee waiver and/or expense reimbursement |
0.13% |
0.39% |
1 The portfolio will not be charged and does not intend to pay any 12b-1 fees on Initial Class shares through May 1, 2021. The maximum 12b-1 fee on Initial Class shares is 0.15%. The portfolio reserves the right to pay such fees after that date.
2 Contractual arrangements have been made with the portfolio’s investment manager, TAM, through May 1, 2022 to waive fees and/or reimburse portfolio expenses to the extent that the total annual fund operating expenses exceed 0.14% for Initial Class shares and 0.39% for Service Class shares, excluding, as applicable, acquired fund fees and expenses, interest, taxes, brokerage commissions, dividend and interest expenses on securities sold short, extraordinary expenses and other expenses not incurred in the ordinary course of the portfolio’s business. These arrangements cannot be terminated prior to May 1, 2022 without the Board of Trustees’ consent. TAM is permitted to recapture amounts waived and/or reimbursed to a class during any of the 36 months from the date on which TAM waived fees and/or reimbursed expenses for the class. A class may reimburse TAM only if such reimbursement does not cause, on any particular business day of the portfolio, the class’s total annual operating expenses (after the reimbursement is taken into account) to exceed the applicable limits described above or any other lower limit then in effect.
The “Example” table included in the Prospectus and Summary Prospectus is deleted in its entirety and replaced with the following:
Example: This Example is intended to help you compare the cost of investing in the portfolio with the cost of investing in other mutual funds.
The Example assumes that you invest $10,000 in the portfolio for the time periods indicated and then redeem all shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the portfolio’s operating expenses remain the same. The Example does not reflect charges that are, or may be, imposed under your variable life insurance policy or variable annuity contract. If such charges were reflected, costs would be higher. Only the 1 year dollar amount shown below reflects TAM’s agreement to waive fees and/or reimburse fund expenses. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
|
|
1 year |
3 years |
5 years |
10 years |
|
Initial Class |
$13 |
$42 |
$73 |
$166 |
|
Service Class |
$40 |
$136 |
$241 |
$550 |
Investors Should Retain this Supplement for Future Reference
TRANSAMERICA SERIES TRUST
Transamerica BlackRock Global Allocation VP
Supplement to the Currently Effective Prospectus,
Summary Prospectus
and Statement of Additional Information
* * *
Effective on or about May 1, 2020, Transamerica Asset Management, Inc. (“TAM”) will terminate its investment sub-advisory agreement with BlackRock Investment Management, LLC (“BlackRock”) with respect to Transamerica BlackRock Global Allocation VP (the “portfolio”) and will enter into a new investment sub-advisory agreement with Morgan Stanley Investment Management Inc. (“Morgan Stanley”) with respect to the portfolio. An information statement will be made available to investors which will provide certain information about the new sub-adviser and the terms of the new sub‑advisory agreement.
In connection with the change in sub-adviser from BlackRock to Morgan Stanley, the following will also change with respect to the portfolio: (i) the portfolio will be renamed; (ii) the portfolio’s investment objective will change; (iii) the portfolio’s principal investment strategies and principal risks will be revised; (iv) the portfolio will have lower management fee and sub-advisory fee schedules; and the portfolio will change its primary and secondary benchmark indices. These changes are described below.
TAM will continue to serve as the portfolio’s investment manager.
* * *
Effective on or about May 1, 2020, Transamerica BlackRock Global Allocation VP will be renamed Transamerica Morgan Stanley Global Allocation VP and the following information will supplement and supersede any contrary information contained in the Prospectus, Summary Prospectus and Statement of Additional Information concerning the portfolio:
INVESTMENT OBJECTIVE:
The portfolio’s investment objective will be as follows:
Seeks high total return.
PRINCIPAL INVESTMENT STRATEGIES:
The portfolio’s principal investment strategies will be as follows:
Under normal circumstances, the portfolio’s sub-adviser, Morgan Stanley Investment Management, Inc. (the “sub-adviser”), seeks to achieve the portfolio’s investment objective by investing primarily in a blend of equity and fixed-income securities of U.S. and non-U.S. issuers. Equity securities may include common and preferred stocks, depositary receipts, convertible securities, equity-linked securities, real estate investment trusts (“REITs”), rights and warrants to purchase equity securities and limited partnership interests. Fixed-income securities may include mortgage-related or mortgage-backed securities, floating rate securities, inflation-linked fixed-income securities, securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities, securities issued or guaranteed by non-U.S. governments, their agencies or instrumentalities, corporate bonds and notes issued by U.S. and non-U.S. entities.
The sub-adviser will utilize a top-down investment approach that focuses on asset class, sector, region, country and currency and thematic allocations. The sub-adviser’s investment and allocation decisions for the portfolio will be based upon the sub-adviser’s evaluations, analyses and judgments, taking into account results of its fundamental market research and recommendations generated by the sub-adviser’s quantitative inputs. The sub-adviser’s research process generally focuses on the following factors across asset classes: 1) valuation (both relative and absolute), 2) dynamics, including earnings revisions, interest rate policy and inflation expectations and 3) technicals, such as investor flows and sentiment. The portfolio may invest in any country, including developing or emerging market countries. The portfolio’s investments may be U.S. and non-U.S. dollar denominated. In determining whether to sell a security, the sub-adviser considers a number of factors, including changes in capital appreciation potential, or the overall assessment of asset class, sector, region, country, and currency and thematic allocation shifts.
The portfolio may invest a portion of its assets in below investment grade fixed-income securities. The mortgage-backed securities in which the portfolio may invest include mortgage pass-through securities that represent a participation interest in a pool of mortgage loans originated by U.S. governmental or private lenders such as banks.
The portfolio may, but is not required to, use derivative instruments for a variety of purposes, including hedging, risk management, portfolio construction, capital appreciation, or to earn income. The portfolio’s use of derivatives may involve the purchase and sale of derivative instruments such as futures, options, swaps and structured investments (including commodity-linked notes), and other related instruments and techniques. The portfolio may utilize foreign currency forward exchange contracts, which are also derivatives, in connection with its investments in foreign securities. Derivative instruments used by the portfolio will be counted toward the portfolio’s exposure to the types of securities listed above to the extent they have economic characteristics similar to such securities.
The portfolio may, consistent with its principal investment strategies, invest up to 25% of its total assets in a wholly-owned subsidiary of the portfolio organized as a company under the laws of the Cayman Islands (the “Subsidiary”). The Subsidiary may invest, directly or indirectly through the use of derivatives, in securities, commodities, commodity-related instruments and other investments, primarily futures, swaps and notes. The Subsidiary has the same investment objective as the portfolio and is managed by Transamerica Asset Management, Inc. and sub-advised by the sub-adviser.
Investments in the Subsidiary are intended to provide the portfolio with exposure to commodities markets within the limitations of the federal tax requirements that apply to the portfolio. The Subsidiary primarily obtains its commodity exposure by investing in commodity-linked derivative instruments, which may include, but are not limited to, total return swaps, commodity (U.S. or foreign) futures and commodity-linked notes. The Subsidiary may also invest in other instruments, including fixed-income securities, either as investments or to serve as margin or collateral for its swap positions, and foreign currency transactions (including forward contracts).
The portfolio may invest up to 10% of its assets in China A-shares (equity securities of Chinese companies) listed and traded on Chinese stock exchanges such as the Shanghai Stock Exchange or the Shenzhen Stock Exchange.
PRINCIPAL RISKS:
The portfolio will no longer be subject to “Convertible Securities” risk, “Distressed or Defaulted Securities” risk, “Growth Stocks” risk, “Loans” risk, “Money Market Funds” risk, “Precious Metals-Related Securities” risk, “Preferred Stock” risk, “Short Sales” risk, “Structured Instruments” risk or “Warrants and Rights” risk as principal risks. The portfolio will be subject to the following additional principal risk:
U.S. Government and Agency Obligations – Government agency obligations have different levels of credit support and, therefore, different degrees of credit risk. Securities issued by agencies and instrumentalities of the U.S. government that are supported by the full faith and credit of the U.S. government generally present a lesser degree of credit risk than securities issued by agencies and instrumentalities sponsored by the U.S. government that are supported only by the issuer’s right to borrow from the U.S. Treasury and securities issued by agencies and instrumentalities sponsored by the U.S. government that are supported only by the credit of the issuing agencies. A security backed by the “full faith and credit” of the U.S. government is guaranteed only as to its stated interest rate and face value at maturity, not its current market price.
SUB-ADVISER:
The portfolio’s sub-adviser will be as follows:
Morgan Stanley Investment Management Inc., a subsidiary of Morgan Stanley, has been a registered investment adviser since 1981. As of September 30, 2019, Morgan Stanley Investment Management Inc. has approximately $507 billion in total assets under management. Morgan Stanley Investment Management Inc.’s principal business address is 522 Fifth Avenue, New York, NY 10036.
PORTFOLIO MANAGER:
The portfolio’s portfolio managers will be as follows:
|
Name |
Sub-Adviser |
Positions Over Past Five Years |
|
|
Cyril Moullè-Berteaux |
Morgan Stanley Investment Management Inc. |
Lead Portfolio Manager of the portfolio since 2020; associated with Morgan Stanley Investment Management Inc. in an investment management capacity since 2011, and from 1995 to 2003; Managing Director; Head of the Global Multi-Asset team; Founding Partner and Portfolio Manager at Traxis Partners from 2003 to 2011 |
|
|
Mark Bavoso |
Morgan Stanley Investment Management Inc. |
Portfolio Manager of the portfolio since 2020; associated with Morgan Stanley Investment Management Inc. in an investment management capacity since 1986; Managing Director; Sr. Portfolio Manager of the Global Multi-Asset team |
|
|
Sergei Parmenov |
Morgan Stanley Investment Management Inc. |
Portfolio Manager of the portfolio since 2020; associated with Morgan Stanley Investment Management Inc. in an investment management capacity since 2011, and from 1996 to 2003; Managing Director; Executive Director of the Global Multi-Asset team; Analyst and Portfolio Manager at Traxis Partners from 2003 to 2008 |
|
MANAGEMENT FEES:
The portfolio’s management fee schedule will be as follows:
TAM will receive compensation from the portfolio, calculated daily and paid monthly, at the annual rates (expressed as a percentage of the portfolio’s average daily net assets) indicated below:
0.66% of the first $500 million
0.65% over $500 million up to $750 million
0.64% over $750 million up to $1 billion
0.63% over $1 billion up to $3 billion
0.59% in excess of $3 billion
SUB-ADVISORY FEES:
The portfolio’s sub-advisory fee schedule will be as follows:
Morgan Stanley will receive monthly compensation from TAM at the annual rate of a specified percentage, indicated below, of the portfolio’s average daily net assets:
|
Fund |
Sub-Adviser |
Sub-Advisory Fees |
|
Transamerica Morgan Stanley Global Allocation VP
|
Morgan Stanley Investment Management Inc. |
0.27% of the first $500 million 0.26% over $500 million up to $1 billion 0.25% over $1 billion up to $3 billion 0.21% in excess of $3 billion |
* * *
BENCHMARKS:
The portfolio’s benchmarks will be as follows:
Primary benchmark = MSCI ACWI Index
Secondary benchmark = Transamerica Morgan Stanley Global Allocation VP Blended Benchmark (consists of the MSCI ACWI Index (60%) and Bloomberg Barclays Global Aggregate Index (40%))
* * *
Investors Should Retain this Supplement for Future Reference
December 9, 2019