Fair Oaks Income Fund has announced that the commitment period of the Master Fund, in which it is invested, ended on 12 June 2016. Reflecting this, the board says that it intends to continue to pay eleven monthly dividends of 0.7 US cents per share and a twelfth interim dividend, “representing an amount in aggregate at least equal to the gross income received by the Company from investments in the relevant financial year that are attributable to the Company’s investment in the Master Fund, less expenses of the Company”.
The board also say that, to the extent that the Company receives distributions of realised capital from the Master Fund, it will give consideration to using such capital to repurchase Shares. The Company’s discount management policy states that Share repurchases will be considered in the event that the Shares are trading at a price representing a discount to the prevailing Net Asset Value per Share of 5% or more, but the Board reserves the right to repurchase Shares at any discount level that it considers to be enhancing to the NAV per remaining Share.
In terms of capital returns, the board says that, to the extent that the Company holds surplus realised capital following distributions from the Master Fund and any Share repurchases, it intends to return such capital to Shareholders on a timely basis and in a cost and tax efficient manner. The board says that it expects that it will be required to convene a general meeting of the Company in order to seek Shareholder approval for the mechanism(s) to be adopted and that it expects the Company will be in a position to commence capital distributions before the end of the third quarter of 2016.
Fair Oaks Income updates on distribution policy, share buyback and capital returns : FAIR