PRUDENTIAL INVESTMENT PORTFOLIOS 18
PGIM Jennison MLP Fund (the "Fund")
Supplement dated September 19, 2024, to the
Currently Effective Summary Prospectus, Prospectus and Statement of Additional Information ("SAI")
Important Notice Regarding Changes to the Fund's Name, Principal Investment Strategy, and
Related Changes
Capitalized terms and certain other terms used in this Supplement, unless otherwise defined in this Supplement, have the meanings assigned to them in the Summary Prospectus, Prospectuses and SAI.
The Board of Trustees of Prudential Investment Portfolios 18 has approved: (i) changing the Fund's name to PGIM Jennison Energy Infrastructure Fund; (ii) modifications of the Fund's principal investment strategy, including its 80% investment policy, and (iii) changes to the Fund's primary benchmark. In connection with these changes, the Fund intends to invest in a manner that will allow it to be treated as a regulated investment company, rather than a "C" corporation, under the Internal Revenue Code of 1986, beginning with the tax year which runs from December 1, 2024 through November 30, 2025. In addition, the Fund's manager has agreed to extend the current contractual expense limitation applicable to each share class of the Fund through to March 31, 2026. In connection with the transition, the Fund will experience increased portfolio turnover, which may cause the Fund to incur additional transaction costs and may cause all or a portion of the Fund's current year distributions to be characterized as ordinary income rather than return of capital. The disposal of the Fund's interest in certain master limited partnerships ("MLPs") may trigger a recapture of certain deductions which may result in additional liabilities incurred by the Fund and potential taxable distributions to shareholders. As described in more detail below, the Fund will need to distribute the accumulated earnings and profits generated as a "C" corporation, including the earnings and profits generated as a result of a deemed sale election, to investors in the first taxable year that the Fund is treated as regulated investment company. This distribution is expected to primarily be treated as qualified dividend income, which for non-corporate shareholders is taxed at preferential rates.
The following changes will take effect on December 1, 2024:
Summary Prospectus and Prospectus Changes
1.The Fund's name is changed to PGIM Jennison Energy Infrastructure Fund and all references to PGIM Jennison MLP Fund are hereby changed to PGIM Jennison Energy Infrastructure Fund.
2.The section entitled "Investment, Risks and Performance - Principal Investment Strategies" is deleted and replaced with the following:
Principal Investment Strategies. Under normal circumstances, the Fund invests at least 80% of its investable assets in U.S. and non-U.S. securities issued by energy infrastructure companies, including master limited partnerships ("MLPs") and "C" corporations ("C-Corps"). Energy infrastructure companies are companies that generally own and operate assets that are used in the energy and utilities sectors, including those used in exploring, developing, producing, generating, transporting (including marine), transmitting, terminal operating, storing, gathering, processing, refining, distributing, mining or marketing of natural gas, natural gas liquids, crude oil, refined products, coal or electricity (including renewables), or that provide energy related equipment or services.
The Fund generally relies on the Global Industry Classification Standard ("GICS") published by Standard & Poor's ("S&P"), as it may be amended from time to time, in determining sector classifications. S&P classifies companies quantitatively and qualitatively. Each company is assigned a single GICS classification according to its principal business activity. S&P uses revenues as a key factor in determining a firm's principal business activity. Earnings and market, however, are also recognized as important and relevant information for classification purposes. The Fund may invest no more than 25% of the value of its total assets in the securities of one or more qualified publicly traded partnerships, which include MLPs that qualify.
The Fund's MLP investments may include, but are not limited to: MLPs structured as limited partnerships ("LPs") or limited liability companies ("LLCs"); MLPs that are taxed as "C" corporations;