16th Jan 2020 11:21
(Alliance News) - Henderson Alternative Strategies Trust PLC on Thursday said it will a propose voluntary liquidation following an asset realisation period after a review found that there was "little appetite" for a potential change in investment strategy.
The trust, which invests in other funds and investment trusts, announced in November that it would conduct a review to assess its "competitive positioning". In its half-year, the trust's net asset value returned just 0.1%, while the FTSE World Total Return Index, the company's benchmark, gained 10.6%.
Its share price on September 30, the end of its first-half, was at a 19% discount to its 333.43 pence net asset value.
Shares in the company were 9.7% higher at 298.28p each in London on Thursday morning.
The probe, dubbed a "root-and-branch" review, found that a shift in investment policy, to allow for more illiquid alternative investments, was the best course of action in order to fight the "persistent discount" which has blighted Henderson Alternative.
The trust added: "However, the review also concluded that there was little appetite from larger shareholders for any increase in the illiquidity of the portfolio and, for many, a preference for realising their investment in an orderly fashion.
Accordingly, your board has been in discussions with its manager regarding proposals to realise the company's assets in an orderly manner that achieves a balance between returning cash to shareholders promptly and maximising their value."
As a result, the company will now propose a different change to its investment policy, this time to allow its manager to "sell the portfolio over a time period", in a bid to realise maximum value.
Henderson said: "Subject to shareholder approval of the proposals, the board will seek to return cash to shareholders through the realisation process and may consider a tender offer or offers as the portfolio is realised."
During the realisation process which is expected to last no longer than two years, Henderson Alternative plans to keep its investment trust status. Following the period, it will prospose entering voluntary liquidation.
By Eric Cunha; [email protected]
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