<PAGE>
PIMCO FUNDS: MULTI-MANAGER SERIES
Supplement Dated June 30, 1999
to the Prospectus for Institutional Class and Administrative Class
Shares Dated May 7, 1999
Disclosure Relating to
PIMCO Small-Cap Growth Fund
Effective July 1, 1999, shares of PIMCO Small-Cap Growth Fund will be
available for purchase by new investors, and the restrictions on purchases of
shares of this Fund described at pages 8 and 60 of the Prospectus will no
longer apply. These restrictions may be reinstated at any time at the
discretion of the Trust's Board of Trustees. This Supplement does not amend or
supersede the investment restrictions relating to the PIMCO Micro-Cap Growth
Fund described in the Prospectus.
Disclosure Relating to
PIMCO Balanced Fund
On June 3, 1999, the Board of Trustees of PIMCO Funds: Multi-Manager Series
(the "Trust") approved an Agreement and Plan of Reorganization pursuant to
which PIMCO Balanced Fund (the "Balanced Fund") is expected to reorganize with
and into PIMCO Strategic Balanced Fund (the "Strategic Balanced Fund"), a
series of PIMCO Funds: Pacific Investment Management Series (the proposed
transaction is referred to as the "Reorganization"). The date of closing (the
"Closing Date") of the Reorganization is expected to be on or about September
17, 1999. The Strategic Balanced Fund seeks the maximization of total return,
consistent with preservation of capital and prudent investment management,
through investment in a combination of short- and intermediate-term fixed
income securities and S&P 500 stock index derivatives. The investment adviser
of the Strategic Balanced Fund is Pacific Investment Management Company, which
is an affiliate of PIMCO Advisors L.P., the Balanced Fund's investment
adviser.
The Reorganization will take place by means of a transfer by the Balanced
Fund of all of its assets to the Strategic Balanced Fund in exchange for
shares ("Merger Shares") of the Strategic Balanced Fund and the assumption by
the Strategic Balanced Fund of all the Balanced Fund's liabilities. The
exchange, which will be effected on the basis of the relative net asset values
of the two Funds, will be followed immediately by the distribution of Merger
Shares to the Balanced Fund's shareholders, in complete liquidation of the
Balanced Fund. Accordingly, shareholders of the Balanced Fund will become
shareholders of the Strategic Balanced Fund by effectively having their
Balanced Fund shares exchanged for Merger Shares of the same class on the
basis of relative net asset value on the Closing Date.
The federal income tax treatment of the Reorganization depends on facts that
cannot be known until the Closing Date. At present, it is thought that there
is a substantial likelihood that the effective exchange of Balanced Fund
shares for Merger Shares on the Closing Date will be a taxable event and will
be treated as any other redemption of shares, i.e., as a sale that may result
in a gain or loss for federal income tax purposes. Shareholders should consult
their tax advisors regarding possible state and local tax consequences.
In addition, in connection with the Reorganization, the following actions
are being taken:
(i) Sales of shares of the Balanced Fund will be suspended as of July 1,
1999 except to qualified benefit plans (or participants therein) if such
plans own Balanced Fund shares on June 30, 1999.
S-1
<PAGE>
(ii) Shareholders of other PIMCO Funds will not be able to exchange their
shares for shares of the Balanced Fund after September 1, 1999.
(iii) In anticipation of the Reorganization, PIMCO Advisors L.P. may (but
is not required to) allocate a greater portion of the Balanced Fund's
portfolio than is customary to the Fixed Income Securities Segment.
(iv) To facilitate the Reorganization and to facilitate possible
redemptions of Balanced Fund shares prior to the Reorganization, the sub-
advisers to the Common Stock Segment of the Balanced Fund will be able to
deviate from the investment strategies applicable to this segment by
investing significantly in short-term fixed-income securities and
derivatives, including S&P 500 stock index derivatives.
The Reorganization is subject to a number of conditions. The Prospectus will
be further supplemented or revised if the Reorganization does not occur
substantially in accordance with the schedule outlined above.
Disclosure Relating to
PIMCO Structured Emerging Markets Fund
PIMCO Tax-Efficient Structured Emerging Markets Fund
The Prospectus is amended effective July 1, 1999 as described below.
The sixth sentence of the subsection captioned "Prospectus Summary--
Investment Risks and Considerations" is deleted and replaced with the
following:
"Except for the Balanced Fund, all of the Funds invest primarily in common
stock or other types of equity or equity-linked securities (the "Stock
Funds")."
The eighth sentence of the subsection captioned "Prospectus Summary--
Investment Risks and Considerations" is deleted and replaced with the
following two sentences:
"Except for the Structured Emerging Markets and Tax-Efficient Structured
Emerging Markets Funds, it is the policy of the other Stock Funds to be as
fully invested as practicable in common stocks. It is the policy of the
Structured Emerging Markets and Tax-Efficient Structured Emerging Markets
Funds to be as fully invested in equity and equity-linked securities as
practicable, except that each of these Funds may invest up to 5% of its
respective net assets in debt securities of emerging market issuers."
The following sentence is added to the end of the penultimate paragraph of
the subsection captioned "Investment Objectives and Policies--Structured
Emerging Markets Fund":
"The Fund may also invest in equity-linked securities."
The first paragraph of the subsection captioned "Investment Objectives and
Policies--Stock Funds" is amended in its entirety to read as follows:
"The Capital Appreciation, Mid-Cap Growth, Micro-Cap Growth, Small-Cap
Growth, Core Equity, Mid-Cap Equity, Equity Income, Value, Value 25, Small-
Cap Value, Enhanced Equity, Tax-Efficient Equity, Structured Emerging
Markets and Tax-Efficient Structured Emerging Markets Funds will each
invest primarily (normally at least 65% of its assets) in common stock.
Each of these Funds may maintain a portion of its assets, which will
usually not exceed 10%, in U.S. Government securities, high quality debt
securities (whose maturity or remaining maturity will not exceed five
years), money market obligations, and in cash to provide for payment of the
Fund's expenses and to meet redemption requests. Except for the Structured
Emerging Markets and Tax-Efficient Structured Emerging Markets Funds, it is
the policy of these Funds to be as fully invested in common stocks as
practicable at all times. It is the policy of the Structured Emerging
S-2
<PAGE>
Markets and Tax-Efficient Structured Emerging Markets Funds to be as fully
invested in equity and equity-linked securities as practicable, except that
each of these Funds may invest up to 5% of its respective net assets in
debt securities of emerging market issuers. These policies preclude these
Funds from investing in debt securities as a defensive investment posture
(although these Funds may invest in such securities to provide for payment
of expenses and to meet redemption requests). Accordingly, investors in
these Funds bear the risk of general declines in stock prices and the risk
that a Fund's exposure to such declines cannot be lessened by investment in
debt securities. The Funds may also invest in convertible securities,
preferred stock, and warrants, subject to certain limitations."
The following subsection is added after the subsection captioned
"Characteristics and Risks of Securities and Investment Techniques--Illiquid
Securities":
"Equity-Linked Securities
Each of the Structured Emerging Markets and Tax-Efficient Structured
Emerging Markets Funds may invest up to 15% of its net assets in equity-
linked securities. Equity-linked securities are privately issued securities
whose investment results are designed to correspond generally to the
performance of a specified stock index or "basket" of stocks, or sometimes
a single stock. Investing in equity-linked securities involves risks
similar to the risks of investing in foreign equity securities. See
"Foreign Securities." In addition, the Funds bear the risk that the issuer
of a equity-linked security may default on its obligations under the
security. Equity-linked securities may be considered illiquid and thus
subject to the Funds' restrictions on investment in illiquid securities."
S-3
<PAGE>
PIMCO FUNDS: MULTI-MANAGER SERIES
Supplement Dated June 30, 1999
to the Prospectus for Class A, Class B and Class C
Shares Dated April 1, 1999
Disclosure Relating to
All Funds
The following new subsection (h) is added to the first full sentence under
"Sales at Net Asset Value" on page 48 of the Prospectus:
"and (h) former Class A, Class B and Class C shareholders of the former
PIMCO Emerging Markets Fund and PIMCO International Developed Fund (the
"Former Funds") who had all of their shares in such Former Fund redeemed in
connection with reorganization transactions (the "Transactions") involving
these Funds on April 30, 1999; provided, however, that this waiver applies
only until the close of business on December 31, 1999 and, for each such
former shareholder, only with respect to a single purchase transaction
involving the investment in one or more Funds of some or all of the
redemption proceeds received by the shareholder in connection with the
Transactions."
The Distributor will not pay any initial sales commission to dealers upon the
sale of Class A shares to the purchasers described in (h) above.
Disclosure Relating to
PIMCO Balanced Fund
On June 3, 1999, the Board of Trustees of PIMCO Funds: Multi-Manager Series
(the "Trust") approved an Agreement and Plan of Reorganization pursuant to
which PIMCO Balanced Fund (the "Balanced Fund") is expected to reorganize with
and into PIMCO Strategic Balanced Fund (the "Strategic Balanced Fund"), a
series of PIMCO Funds: Pacific Investment Management Series (the proposed
transaction is referred to as the "Reorganization"). The date of closing (the
"Closing Date") of the Reorganization is expected to be on or about September
17, 1999. The Strategic Balanced Fund seeks the maximization of total return,
consistent with preservation of capital and prudent investment management,
through investment in a combination of short- and intermediate-term fixed
income securities and S&P 500 stock index derivatives. The investment adviser
of the Strategic Balanced Fund is Pacific Investment Management Company, which
is an affiliate of PIMCO Advisors L.P., the Balanced Fund's investment adviser.
The Reorganization will take place by means of a transfer by the Balanced
Fund of all of its assets to the Strategic Balanced Fund in exchange for shares
("Merger Shares") of the Strategic Balanced Fund and the assumption by the
Strategic Balanced Fund of all the Balanced Fund's liabilities. The exchange,
which will be effected on the basis of the relative net asset values of the two
Funds, will be followed immediately by the distribution of Merger Shares to the
Balanced Fund's shareholders, in complete liquidation of the Balanced Fund.
Accordingly, shareholders of the Balanced Fund will become shareholders of the
Strategic Balanced Fund by effectively having their Balanced Fund shares
exchanged for Merger Shares of the same class on the basis of relative net
asset value on the Closing Date.
The federal income tax treatment of the Reorganization depends on facts that
cannot be known until the Closing Date. At present, it is thought that there is
a substantial likelihood that the effective exchange of Balanced Fund shares
for Merger Shares on the Closing Date will be a taxable event and will be
treated as any other redemption of shares, i.e., as a sale that may result in a
gain or loss for federal income tax purposes. Shareholders should consult their
tax advisors regarding possible state and local tax consequences.
S-1
<PAGE>
No sales charges will be charged to Balanced Fund shareholders on the
redemption of Balanced Fund shares or the issuance of Merger Shares in
connection with the Reorganization. Merger Shares received by Balanced Fund
shareholders will be subject to a contingent deferred sales charge ("CDSC") to
the same extent that the Balanced Fund shares exchanged were so subject. For
purposes of computing the CDSC, if any, payable on redemption of Class A,
Class B or Class C Merger Shares received by Balanced Fund shareholders, and
determining the date on which Class B Merger Shares convert to Class A shares,
the Merger Shares will be treated as having been purchased as of the date
that, and for the price at which, the Balanced Fund shares exchanged for such
Merger Shares were purchased.
In addition, in connection with the Reorganization, the following actions
are being taken:
(i) Sales of shares of the Balanced Fund will be suspended as of July 1,
1999 except to qualified benefit plans (or participants therein) if such
plans own Balanced Fund shares on June 30, 1999.
(ii) Shareholders of other PIMCO Funds will not be able to exchange their
shares for shares of the Balanced Fund after September 1, 1999.
(iii) In anticipation of the Reorganization, PIMCO Advisors L.P. may (but
is not required to) allocate a greater portion of the Balanced Fund's
portfolio than is customary to the Fixed Income Securities Segment.
(iv) To facilitate the Reorganization and to facilitate possible
redemptions of Balanced Fund shares prior to the Reorganization, the sub-
advisers to the Common Stock Segment of the Balanced Fund will be able to
deviate from the investment strategies applicable to this segment by
investing significantly in short-term fixed-income securities and
derivatives, including S&P 500 stock index derivatives.
The Reorganization is subject to a number of conditions. The Prospectus will
be further supplemented or revised if the Reorganization does not occur
substantially in accordance with the schedule outlined above.
S-2
