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Ranger Direct Lending will wind up

11
2018
June

Ranger Direct Lending will wind up – Ares Capital Management III LLC has notified the board of Ranger Direct Lending that it no longer wishes to take up the position as investment manager. The board has concluded, therefore, that it doesn’t make sense to keep the company going. It has decided to recommend that the company should move to realise its assets in an orderly manner. The company’s advisers concur with this view.

The existing board of Ranger is keen that shareholders don’t support the Oaktree and LIM Asia proposals to make changes to the board.

The board seems to have created a situation where some shareholders had sight of the circular that described Ares’ proposals and others, including Ranger’s small shareholders, didn’t.

From the announcement: “In summary therefore – 

  1. The Company is withdrawing the proposal that Ares, subject to shareholder approval, be appointed as the Company’s investment manager.  The Independent Directors would like to put on record their gratitude to Ares for the commitment it has shown throughout this process. 
  2. The Board continues to recommend that shareholders vote against the Oaktree and LIM resolutions being voted on at the AGM on 19th June 2018 (Resolutions 8, 9, 10, 11 and 12) for the reasons set out below. 
  3. Provided that the current independent directors make up a majority of the board following the AGM, the Board will appoint additional independent non-executive directors following consultation with shareholders to assist with the winding up and the realisation of the Company’s assets in an orderly manner. 

Assuming the current independent directors continue to make up a majority of the Board following the AGM, the Board will commence a dialogue with ordinary shareholders and ZDP shareholders about a portfolio realisation process and timetable for winding-up the Company. Any such process will also have full regard for the rights of the ZDP shareholders. In the meantime, the Board has instructed Ranger to consider how best to realise the portfolio in a manner that maximises value for all shareholders. The Board would emphasise that any process of orderly realisation of the portfolio needs to take into consideration the status of the legal proceedings currently in process in respect of the investment in Princeton, and they intend for the Company to continue to actively engage in those proceedings with Ranger until their conclusion. 

A further announcement will be made following the conclusion of the Company’s AGM on 19 June 2018.”

The board has also published a detailed argument in response to the recent Oaktree and LIM Asia letters.

Update 18 June 2018 – resignations!

Christopher Waldron, Chairman, and Matthew Mulford have both confirmed that they will resign immediately prior to the AGM. As Chairman Mr Waldron lead the Company’s management review process which concluded with Ares being selected as the preferred candidate to be put to shareholders in general meeting. Now that an orderly wind up of the Company is being pursued, Mr Waldron has determined that it is appropriate for him to step down. Mr Mulford has separately decided that it would now be an appropriate time to step down as the board is reconstituted in connection with the realisation of the Company’s portfolio. 

Jonathan Schneider intends to continue as a Director. A vote on Mr Schneider’s re-election to the Board will be held at the AGM. This vote is being held as part of the Company’s regular corporate governance programme. 

Scott Canon has also confirmed his intention to resign as a director immediately prior to the AGM in order that the newly formed board is independent of the Company’s investment manager. Mr Canon’s resignation has no impact on the Company’s relationship with its investment manager and is solely proposed in the context of the orderly realisation of the portfolio. 

As shareholders are aware, various new directors are proposed for election at the AGM.  Following the conclusion of the AGM, the board members at that time will determine what additional representation or experience is required on the Company’s board taking into account the views of shareholders as it sees appropriate.”

RDL : Ranger Direct Lending will wind up

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