Aberdeen Emerging breaks liquidity listing rule – At 12:32 today Aberdeen Emerging Markets Investment company made the following announcement:
“Announcement regarding shares in public hands
The Board of AEMC announces that the number of ordinary shares which are deemed by the Listing Rules to be held in public hands is below the minimum 25% threshold. The Listing Rules provide that shares are not considered to be held in public hands if they are held by persons (or persons in the same group or persons acting in concert) who have an interest in 5% or more of a listed company’s share capital, as well as shares held by directors of a listed company.
Following recent purchases by certain of the Company’s largest shareholders, the shares in public hands is currently estimated to be approximately 17 per cent.
The Company is liaising with the FCA and will make a further announcement shortly.”
This is a slightly odd situation. Aberdeen Emerging’s largest shareholders don’t gang up to influence what it does and none of them could be said to be in control of the company if acting alone. We aren’t surprised that they have been buying – we pointed out in our recent note that it was strange that it traded on the widest discount in its peer group despite its improved performance. There seems to be a reasonable amount of turnover in the stock. We haven’t seen this happen before so we aren’t sure whether the FCA will demand that something changes or decide to monitor the situation. Some trusts with concentrated registers trade on the specialist fund segment but this usually happens when there are one or two very large shareholders not several largish ones. Making Aberdeen Emerging Markets move to the specialist fund segment would probably hurt liquidity and make the situation worse. That’s because many trading platforms are funny about individual shareholders dealing in these stocks (which we find weird give all the outlandish stuff they can buy on AIM etc without restriction).
AEMC : Aberdeen Emerging breaks liquidity listing rule
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