https://www.sec.gov/Archives/edgar/data/1480207/000119312525192866/d21840d497.htm497 1 d21840d497.htm 497
DOUBLELINE FUNDS TRUST
DoubleLine Floating Rate Fund (the “Fund”)
Supplement dated August 29, 2025 to the Fund’s Summary Prospectus
(the “Summary Prospectus”), Prospectus (the “Prospectus”) and
Statement of Additional Information (the “SAI”), each dated July 31, 2025,
as supplemented from time to time
This supplement provides new and additional information beyond that contained in the Summary Prospectus, Prospectus and SAI and should be read in conjunction with the Summary Prospectus, Prospectus and SAI.
The Board of Trustees of DoubleLine Funds Trust (the “Board”) approved a proposal under which, subject to shareholder approval, the Fund would be merged with and into the American Beacon DoubleLine Floating Rate Income Fund (the “Acquiring Fund”), a series of the American Beacon Funds (the “Transaction”). The Fund and Acquiring Fund have substantially similar principal investment strategies and have the same portfolio management team. DoubleLine Capital LP, the adviser to the Fund, serves as the sub-adviser to the Acquiring Fund. American Beacon Advisors, Inc. serves as the investment adviser to the Acquiring Fund. Completion of the proposed Transaction, often called a “fund adoption,” is subject to, among other things, approval by the shareholders of the Fund.
If approved by the Fund’s shareholders, the proposed Transaction is expected to be completed in the first quarter of 2026, although this timeline is subject to adjustment. A Combined Proxy Statement and Prospectus related to a special meeting of shareholders of the Fund is expected to be sent to shareholders of the Fund in the fourth quarter of 2025. Those materials will describe the Transaction in more detail and the reasons for the Board’s approval of the proposed Transaction. Shareholders of the Fund should watch for the arrival of these important materials. This supplement is not a proxy and is not soliciting any proxy, which can only be done by means of a proxy statement.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
Comments
This does not appear to be a typical fund adoption.
(WSJ article from a dozen years ago, subscription required, on fund adoptions).
In a typical fund adoption, the adopting fund company creates a shell fund and the old (acquired) fund is merged into it. For example (this is given in the WSJ piece), Bridgeway Large Cap Value was adopted by American Beacon by merging it into the then shell fund BRLVX (at the time called American Beacon Bridgeway Large Cap Value).
https://www.mutualfundobserver.com/discuss/discussion/1561/bridgeway-large-cap-value-fund-reorganized-into-american-beacon-bridgeway-large-cap-value-fund
But here, the acquiring American Beacon fund exists and already has around $63M AUM.
https://www.americanbeaconfunds.com/mutual_funds/FEACFloatingRateIncome.aspx
Until June 20, this fund was called the American Beacon FEAC Floating Rate Income Fund and was subadvised by First Eagle Alternative Credit, LLC (FEAC). American Beacon changed the subadvisor of this existing fund to DoubleLine. Since DoubleLine charges more than FEAC for its services, American Beacon reduced its management fee so that the total (its fee plus the subadviser's fee) remained the same.
I can't tell exactly what the effect will be on shareholders of DBFRX / DLFRX because a fund with I and N shares is being acquired by a fund with R5, Investor, Y, A, and C shares. They don't align. But it looks very possible that the DoubleLine shareholders' fees will go up.
It's easy to see why American Beacon wants this acquisition. Its fund is a small 1* fund. It is buying assets, reputation (" beneficial publicity" as stated in its filing; see link above) and better management.
What's in it for the shareholders of the larger ($112M AUM) DoubleLine fund?
When I ran across this filing, I thought of the Bridgeway Large Cap Growth and Large Cap Value funds also.
I used to have the Sound Point Floating Rate Income fund (SPFRX which is now as American Beacon DoubleLine Floating Rate Income fund) for many years, even after it was acquired by American Beacon. I unloaded it last year as the fund has not performed like it used to as well as undergoing significant asset erosion under management.
Tocqueville International Value fund was also acquired by American Beacon.
Sound Point Floating Rate Income fund acquisition by American Beacon:
https://www.sec.gov/Archives/edgar/data/1261788/000089418915005215/sndpt-tap_497e.htm
Name change of Sound Point Floating Rate Income fund:
https://www.sec.gov/ix?doc=/Archives/edgar/data/809593/000113322822008078/abspfrif-html5857_497.htm
Sound Point Floating Rate Income fund investor class converted into A class:
https://www.sec.gov/Archives/edgar/data/809593/000113322823006031/abfeacfrif-html6974_497.htm
https://www.sec.gov/Archives/edgar/data/809593/000089843215001344/a485bpos.htm
Looking into American Beacon - I knew that it had started out as American AAdvantage Funds before a renaming in 2005. Those funds were an outgrowth in 1987 of American Airlines pension investing. What I didn't realize was that just three years after the rebranding AMR sold American Beacon It was subsequently sold again and rebranded again.
http://www.mfwire.com/fundprofile.asp?fund=19415&bhcp=1
AAdvantage had some decent funds, but American Beacon seems to have gone downhill.
https://www.nytimes.com/2000/01/16/business/investing-buying-airlines-mutual-funds-is-it-the-return-or-the-miles.html
Current fees are high, stars are below par. It is bleeding assets. Over the past twelve months it has lost almost 14% of AUM, down to $18B (per M*). That's down from the $22B it had in 2000, according to the NYTimes article above.
https://www.morningstar.com/asset-management-companies/american-beacon-BN000007X6
I wonder when this decline started - with AMR's sale of the company, with the later sale, or perhaps American Beacon never did as well as the earlier AAdvantage funds.