Prospect’s manager is keen that their investment remit be expanded, arguing that if they are allowed to take larger positions in companies and engage with them to encourage share buy-backs, asset sales and reconstructions, the fund will benefit.
To that end the Board is proposing that the maximum investment in any one company be set at 25% of the fund (up from 10%). There be no restriction on investing in non-corporate investments or securities not listed or quoted on a recognised stock exchange (but they will not invest in unlisted securities unless a listing or other realisation is expected in a reasonable period of time) and there be no restriction on the percentage of a company’s issued share capital that PJF may own (but it will not take legal or management control of its investments). The Board also proposes that gearing is limited to 20% of NAV, a 10% limit is placed on investing in other closed end investment funds and a 5% limit on unit trusts and that the new benchmark be the MSCI Japan Small Cap (Total Return) Index.
Shareholders get to vote on the idea on 5 March 2014.