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Henderson Alternative Strategies to seek approval for realisation process after little appetite shown for greater illiquid exposure

Alex Barr joins Henderson Alternative team

Henderson Alternative Strategies (HAST) has released the following update:

“In our interim results for the half-year to 30 September 2019, we reported that Alex Barr, the senior portfolio manager of the company, had undertaken a root-and-branch review of the portfolio and our company’s competitive positioning. In addition, he had been meeting shareholders and listening to their views. We undertook to share any recommendations and consequent proposals with shareholders early in 2020.

This review concluded that the best way to improve performance, and therefore to reduce the persistent discount, would be to change the company’s investment policy to enable the company to own more illiquid alternative investment strategies not readily available for direct investment, and which would reward skilled selection and demand enhanced due diligence. 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, the 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.

The board expects to post a circular to shareholders in the coming weeks which will seek approval for a change in investment policy that will enable our manager to sell the portfolio over a time period that will give it every opportunity to maximise asset realisation value. 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 and will seek to adopt the most efficient method of returning that capital to shareholders.

The company intends to maintain its investment trust status during this managed realisation process which is not expected to last longer than two years. At the conclusion of the realisation process, the board intends to propose that the company enter into voluntary liquidation.”

[Yet another trust where the board decides to wind up the trust without first calling for new ideas / rollover options from other managers and investment companies. This is very disappointing in our view.]

HAST: Henderson Alternative Strategies to seek approval for realisation process after little appetite shown for greater illiquid exposure

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