LIM Advisors, manager of two funds that collectively are the second largest independent unitholder in the ASX-listed AMP Capital China Growth Fund (“AGF” or “the Fund”), welcomes the decision by unitholders to support its resolution to wind up the Fund in an Extraordinary General Meeting held today.
83% of votes cast during the poll were in favour of the wind up resolution, also ensuring it passed the 50% threshold of eligible voters with 54.45% of eligible units in favour after the largest unitholder, AMP Life, was excluded from voting its 36% stake by the NSW Supreme Court.
LIM Advisors’ Nick Paris said he was delighted that unitholders had been given the opportunity to decide on the future of AGF and voted strongly in favour of our resolution to wind up the Fund.
“We took this action reluctantly as we had no other choice following repeated requests to AMP for an open-ending or unlimited redemption offers from AGF. However, we have pursued the wind up option with the interests of all unitholders in mind and hope it serves as a lesson for AMP Capital as the Responsible Entity that unitholders will not tolerate large persistent discounts, sustained poor performance, excessive fees and weak corporate governance,” he said.
“While all unitholders, including AMP Life, have benefited from the recent closing of the discount and the passing of the wind up resolution, the wind up and substantial costs incurred by AGF unitholders could easily have been avoided if the RE, AMP Capital, had listened to the concerns of unitholders from the outset.”
“We are ready and willing to work with AMP Capital on the orderly wind up of AGF and to help ensure the repatriation of proceeds from China as quickly as possible for all unitholders,” Mr Paris said.
“We suggest that AMP offer an open-ended fund investing in China to those AGF retail investors who want to remain invested in China. AGF unitholders could elect to convert into this new fund either prior to the commencement of the winding up of AGF or afterwards with the proceeds already remitted back to Australia.”
LIM Advisors expects its funds to have a continued presence in the Australian market, most likely in areas outside activist situations.
“We already have substantial investments in Australian listed shares, private debt and real estate. We see a number of potential opportunities in the mining services and property areas, particularly in credit refinancing and the provision of mezzanine and senior stretch finance,” Mr Paris said.