![]() | 1801 California Street, Suite 5200 Denver, Colorado 80202 |
September 18, 2019
VIA EDGAR CORRESPONDENCE
Mr. Mark Cowan
United States Securities and Exchange Commission
Division of Investment Management
100 F Street, NE
Washington, DC 20549-0102
Re: | Transamerica Series Trust (the “Registrant”) |
Form N-14 / File No. 333-233270
Dear Mr. Cowan:
On behalf of the Registrant, we are filing this letter to respond in writing to comments received from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission” or the “SEC”) on the Registration Statement on Form N-14 (the “Registration Statement”) filed pursuant to Rule 488 under the Securities Act of 1933, as amended (the “1933 Act”), with the Commission on August 14, 2019 (Accession Number: 0001193125-19-221153), relating to the proposed reorganization (the “Reorganization”) of Transamerica Torray Concentrated Growth VP (the “Target Portfolio”) into Transamerica WMC US Growth VP (the “Destination Portfolio”). The Target Portfolio and Destination Portfolio are sometimes referred to herein as a “Portfolio” or the “Portfolios.”
Below are the Staff’s comments, which were conveyed to the Registrant in writing on September 4, 2019 and by telephone on September 5, 2019, and the Registrant’s responses thereto.
1. | Comment: Please confirm that all series and class information has been updated on the EDGAR website. |
Response: The Registrant so confirms.
2. | Comment: In the “Where to Get More Information” section, please confirm whether the Destination Portfolio’s prospectus was intentionally not incorporated by reference because all relevant information is in the N-14. Additionally, please confirm and disclose whether the Portfolios’ most recent annual and semi-annual reports are incorporated by reference. |
Response: The Registrant confirms that the Destination Portfolio’s prospectus was intentionally not incorporated by reference because all of the relevant information is included in the N-14 filing. The Registrant further confirms that the Portfolios’ most recent annual and semi-annual reports are incorporated by reference in Part B of the Registration Statement.
3. | Comment: In the “Questions and Answers – How Will the Reorganization Work?” section, the fifth bullet conflicts with disclosure in the “Why did the Trustees Approve the Reorganization?” section of the Registration Statement. Please confirm and reconcile the language. |
Response: The Registrant has made changes in response to the Staff’s comment to reconcile this difference.
4. | Comment: In the “Questions and Answers – How Will the Reorganization Work?” section, the seventh bullet states that “The exchange of Target Portfolio shares for Destination Portfolio shares in the Reorganization is generally not expected to result in income, gain or loss being recognized for federal income tax purposes by an exchanging shareholder.” Please confirm whether this should be “will not result” instead of “not expected to result” in income, gain or loss being recognized. In addition, the next sentence should not be qualified with “generally.” Please confirm and reconcile the language in this bullet. |
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Response: The Registrant has made the requested changes in response to the Staff’s comment.
5. | Comment: In the “Questions and Answers – Why did the Trustees Approve the Reorganization?” section, please reconcile the language as noted in Comment 3 to explain what is meant by the “net expense ratio is expected to be lower.” In addition, please clarify which “current management fee” is referenced. |
Response: The Registrant has made changes in response to the Staff’s comment.
6. | Comment: Please conform the language in the “Question and Answers” section and the “Reorganization” section to state that the investment objectives and policies are either “similar” or “substantially similar.” |
Response: The Registrant has made changes consistent with the Staff’s comment.
7. | Comment: In the “Questions and Answers – How do the Target Portfolio and the Destination Portfolio compare? – Investment Strategy” section, please explain in plain English the terms “concentrated stock selection” and “bottom-up” in the following sentences: |
“The Target Portfolio utilizes a concentrated stock selection approach. The Destination Portfolio utilizes a “bottom-up” stock selection approach.”
Response: The Registrant has made changes in response to the Staff’s comment.
8. | Comment: In the “Questions and Answers – How do the Target Portfolio and the Destination Portfolio compare? – Investment Strategy” section, please revise the second paragraph to disclose the extent to which the Target Portfolio invests in foreign issuers. |
Response: The Registrant has made changes in response to the Staff’s comment.
9. | Comment: In the “Questions and Answers – How do the Target Portfolio and the Destination Portfolio compare? – Principal Risks,” please discuss how the risks are similar and their primary differences between the Portfolios. |
Response: The Registrant believes the current presentation of risk disclosures, which is consistent with the presentation in past Form N-14s, is appropriate.
10. | Comment: In the “Questions and Answers – How do the Target Portfolio and the Destination Portfolio compare? – Total Operating Expenses” section, please clarify the timeframe of the expense limitation agreement following the Reorganization, and note that the expenses may increase after the expiration of such expense limitation. |
Response: The Registrant has made changes consistent with the Staff’s comment.
11. | Comment: In the “Reorganization” section, please provide additional narrative disclosure comparing and contrasting the fees and expenses of the Target Portfolio and the Destination Portfolio. |
Response: The Registrant believes the current disclosure, which is consistent with the presentation in past Form N-14s, coupled with the fee and expense discussion in the “Questions and Answers” section of the Information Statement/Prospectus, is appropriate.
12. | Comment: In the “Reorganization – Fee Waiver and Expense Limitations” section, please revise the disclosure to be consistent with the Fee Tables for the Reorganization. |
Response: The Registrant has made changes consistent with the Staff’s comment.
13. | Comment: The Staff notes that the risk disclosure should be listed in order of significance and requests clarification as to the reason that the “additional principal risks” are listed separately and alphabetically. |
Response: The Registrant has made an additional change in response to the Staff’s comment. While the Registrant has made certain changes in response to the Staff’s comments on this and other recent Form N-14s, the Registrant wishes to keep its presentation of risk disclosures generally consistent across the current prospectuses within the Transamerica fund complex. The Registrant is considering potentially reordering the principal risks in connection with the next annual update.
14. | Comment: In “The Portfolios’ Past Performance” section, please revise the following sentence to refer to Initial Class shares, if accurate. Otherwise, delete this sentence. |
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“For a class that has higher expenses, performance would have been lower.”
Response: The Registrant has made changes in response to the Staff’s comment.
15. | Comment: Please move “The Portfolios’ Fees and Expenses” section to before “The Portfolios’ Past Performance” section pursuant to Item 3a of Form N-1A. |
Response: The Registrant has made changes consistent with the Staff’s comments.
16. | Comment: Please confirm that “The Portfolios’ Fees and Expenses” are current fees per Item 3a of Form N-1A. |
Response: The Registrant so confirms.
17. | Comment: In “The Portfolios’ Fees and Expenses” section, please consider revising the Fee Table headers to reflect “Target Portfolio” and “Destination Portfolio” instead of the Portfolio names. |
Response: The Registrant has made changes consistent with the Staff’s comments.
18. | Comment: In “The Portfolios’ Fees and Expenses – Annual Fund Operating Expenses” table, please confirm that footnote (2) is relevant since 12b-1 fees are not currently charged. |
Response: The Registrant confirms the relevance of the footnote.
19. | Comment: In “The Portfolios’ Fees and Expenses – Annual Fund Operating Expenses” tables, please revise the similar footnote disclosure from “any other lower limit then in effect” to “the expense cap in place at the time such amounts were waived.” |
Response: The Registrant has made changes consistent with the Staff’s comment.
20. | Comment: Please confirm that there will be no expense recapture of amounts previously waived for the Target Portfolio after the Reorganization. |
Response: The Registrant so confirms.
21. | Comment: In the “Portfolios’ Fees and Expenses – Annual Fund Operating Expenses” table, please confirm that footnotes (3) and (4) are relevant as no waiver or reimbursement is disclosed in the corresponding fee and expense tables. |
Response: The Registrant has deleted the relevant footnotes noted in the Staff’s comment as the total expenses shown are not exceeding the expense caps.
22. | Comment: The Staff notes that the contractual fee waivers and expense reimbursements must be for periods of no less than one year from the effective date of the Registration Statement. Please clarify bullet four under “Reasons for the Proposed Reorganization – Fees and Expenses” to state that the total operating expenses after the Reorganization are only expected to be the same or lower through May 1, 2020, when the fee waiver and expense reimbursements terminate. |
Response: The Registrant has made changes consistent with the Staff’s comment.
23. | Comment: Please provide estimates of the amount of Target Portfolio securities expected to be sold and significant brokerage expenses that may be incurred by the shareholders of the combined Destination Portfolio for the Reorganization. |
Response: The Registrant has included the requested estimates in response to the Staff’s comment.
24. | Comment: In the “Tax Status of the Reorganization” section, please confirm the date used to estimate the dividend distribution by the Target Portfolio. Additionally, please confirm the numbers disclosed in the distribution table. |
Response: The Registrant so confirms.
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25. | Comment: In the “Additional Information” section, please consider deleting the stricken language from the following sentence, as the Staff notes that rights conferred by federal or state laws cannot be waived, explicit or not: |
“Neither this prospectus nor the SAI is intended to give rise to any contract rights or other rights of any shareholder, other than any rights conferred explicitly by federal or state securities lawsthat may not be waived.”
Response: The Registrant believes that the current disclosure is accurate.
26. | Comment: The Staff notes that documents incorporated by reference in Part C must be identified. Accordingly, please revise the following sentence: “All exhibits filed previously are herein incorporated by reference.” |
Response: The Registrant has deleted the relevant sentence noted in the Staff’s comment and specifically identified all incorporated documents.
Additional SEC Accounting comments conveyed to the Registrant by telephone on September 5, 2019:
27. | Comment: Please confirm that the Registrant’s annual and semi-annual shareholder reports for the periods ended December 31, 2018 and June 30, 2019, respectively, will be incorporated by reference in a post-effective amendment filed pursuant to Rule 485(b). |
Response: The Registrant so confirms.
28. | Comment: The Staff notes that the Registrant’s risk disclosures should be listed in order of significance, not alphabetically. Please revise accordingly. |
Response: Please see the Registrant’s response to Comment 13.
29. | Comment: In “The Portfolios’ Fees and Expenses – Annual Fund Operating Expenses” table, please explain why footnote (1) to the fee table indicates that “Management fees have been restated to reflect a reduction in management fees effective August 2, 2019,” but the prospectus was not supplemented to reflect that reduction. |
Response: The Registrant filed the relevant supplements for the Destination Portfolio on August 2, 2019, pursuant to Rule 497 (Accession Number: 0001193125-19-212110) and Rule 497(k) (Accession Number: 0001193125-19-212119).
30. | Comment: In “The Portfolios’ Fees and Expenses – Annual Fund Operating Expenses” table, please confirm that footnote (3) is relevant to both the Target Portfolio and the Destination Portfolio. |
Response: Please see the Registrant’s response to Comment 21.
Please direct any comments or questions concerning this filing to the undersigned at 727-299-1311.
Very truly yours, |
/s/ Cathleen M. Livingstone |
Cathleen M. Livingstone |
Manager, Registered Products and Distribution |
Transamerica Asset Management, Inc. |
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