Amati VCT 2 (ATI2): The boards of Amati and VICTory (VICT) have concluded discussions over a possible merger of both companies. They believe that a single company with a larger asset base, increased cost efficiency and diversified risk will serve shareholders better. Thus the proposals are being put to shareholders. Subject to approval, Amati will be placed into a voluntary liquidation with all its assets and liabilities transferred to the VICTory fund. Given the size of both funds (£16m and £10m) we are inclined to agree with the board’s assessment.
British Assets (BSET): The board has agreed changes to the fee structure with the trust’s manager. Effective 1 October, the performance fee will no longer apply. Instead, the base fee levied by F&C has risen from 0.3% to 0.4%. This is still very competitive when compared with its peers, particularly when looking at global equity OEICs, where the average TER is around 1.7%. As well as the change to fees, the fund’s benchmark has also changed, although the difference is modest. The previous benchmark was 75% FTSE All Share/25% FTSE World ex UK – this has changed to 80%/20%. Although there will be changes to the portfolio composition at the margin, the impact should be minimal.
Carador Income Fund EUR (CIF): Dexion Capital Plc has been appointed as joint financial adviser and joint broker of the company and will work alongside Singer Capital Markets on the advisory side and with both Singer Capital Markets and RBS Hoare Govett Limited on the brokerage side.
Charter European Trust (CPE): After a strategic review, the board has announced its recommendation to liquidate the fund ahead of the March 2014 windup date. Under this scheme, shareholders could choose to realise their investment in whole or in part for cash and/or to roll over their investment into the Jupiter European Fund. However, this is being contested by Midas Investment Management, the biggest stakeholder with over 25% stake in the fund. Midas has been steadily increasing its holding in the trust since the middle of the year and it has stated it will only support a set of proposals that include Manchester & London Investment Trust, a fund managed by Midas, as a rollover option. The board has reluctantly agreed to include Manchester & London as a secondary rollover option. However, the issue is far from resolved, as Midas is unhappy with the use of the word ‘reluctant’ in any communications from the board regarding the rollover options. Midas is seeking an EGM to remove the current board, with the exception of Giles Weaver, who sits on a number of trusts’ boards. This ongoing activity has resulted in the fund trading at a premium to its NAV, having been at a discount of more than 10% earlier this year.
Invesco Perp Select Global Eq (IVPG): Subject to shareholders approval, the company is proposing to change its investment policy in order to increase the income orientation of the fund. The initial target dividend yield will be 3.5%, with potential for future growth. The change will entail a change of portfolio manager internally and the fund of hedge funds portfolio will become long-only, managed by Invesco Global Strategies in Atlanta, USA. The change will also see Bob Yerbury step down as manager of the global portfolio; this is entirely expected as Yerbury has been gradually reducing his responsibilities at the firm since stepping down as CIO early last year.
John Laing Infrastructure (JLIF): The company has announced plans to issue new shares in the form of an open offer. The offer is fully pre-emptive on the basis of one new share for every two existing ones held on September 26. Qualifying shareholders will be able to apply for additional shares by means of an excess application facility: in other words, they can apply for more shares that they would otherwise not be entitled to receive. The company plans to use the proceeds to finance new acquisitions, as well as bolster existing projects.
Jupiter Primadona Growth (JPG): The board plans to renew its share buy-back facility at the next AGM. The fund has been recently trading at a single digit discount to its NAV, hence the company has not been buying back shares during the year; however, more recently it has tipped over to a premium. The board was very proactive in 2010, when the fund was trading at a discount that ranged from nearly 4% to over 20%.
Kings Arms Yard VCT (KAY): The merger with Kings Arms Yard VCT 2 was approved by shareholders this week and the assets have been combined as a result.
Marwyn Value Investors (MVI): GLG Partners has sold most of its 8% of stake in this fund and now holds just over 1%. The fund has delivered some strong performance year to date, in both NAV and price terms, compared with its index and peers.
Minoan Group (MIN): Shares have resumed trading in this Greek property company and a general meeting has been scheduled for 17 October. At this meeting, shareholders will be asked to approve the acquisition of John Semple Travel and this will constitute a reverse takeover.
NB Global Floating Rate (NBLS): The company has raised approximately $187m through its recent C share issue, split between the two shares (GBP and USD).
Northern Investors (NRI): Following approval in July to wind up the company, the board has announced the first of a series of tender offers to return cash to shareholders. This offer will take place in the final quarter of 2011.
Promethean (PTH): Laminvest NV and Knox D'Arcy have failed to gain support for their requisitions at the private equity company’s EGM and shareholders rejected their proposed board changes.
PUMA VCT III (PUMC): The board has announced its plans to wind up the company, well in advance of its 2016 date.
