16th Feb 2021 21:44
(Alliance News) - BH Macro Ltd and BH Global Ltd on Tuesday announced plans to put their managers' fee increase requests to vote.
On January 22, they both said they had received a letter from their managers requesting that previously agreed fee concessions be withdrawn or else their management agreements may be terminated.
BH Macro is a a feeder fund that invests all of its assets directly into the Brevan Howard Master Fund. Manager Brevan Howard Capital Management LP has said that management fee concessions, agreed in 2016 and 2017, no longer support BH Macro's future success and proposes these be withdrawn with "contractual fee terms are adjusted back broadly to their prior position".
In response to this, BH Macro intends to put forward the changes requested by the manager. If shareholders approve the changes, then BH Macro will make a tender offer to acquire up to 40% of shares at 98% of net asset value per share at the time of tender offer completion, less costs.
The GM will take place as soon as possible in March. BH Macro noted that: "The manager has agreed with the company that the manager will not serve notice of termination of the management agreement prior to the extraordinary general meeting being held."
BH Global invests in the Brevan Howard Multi-Strategy Master Fund, and its manager is Brevan Howard Capital Management Ltd. It said it tries to continue dee discussions with its investment manager, which were in train before the letter was received, and has also listened to shareholder feedback.
"The board has made, in good faith, various proposals to the Investment Manager but the investment manager has been unwilling to consider any reasonable alternative to the terms that it put forward in the BH letter," BH Global said.
As some of its shareholders are minded to accept the fee increase, if reluctantly in most cases, BG Global will also hold an extraordinary general meeting to allow shareholder to vote on the changes to fee arrangements.
Given that some shareholders may not with to stay invested in BH Global, it is considering how to allow dissenting shareholders to exit. Therefore, if measures are approved, it "will seek to implement such return of capital on the most advantageous terms for shareholders."
BH Global's shares closed 2.3% higher at 1,975.00 pence in London on Tuesday, while BH Macro GBP shares closed 0.2% lower at 3,330.00p and USD shares down 1.7% at USD34.40.
By Anna Farley; [email protected]
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