Asian private equity fund Symphony International becomes the latest fund to adopt an orderly realisation strategy.
Symphony says that, further to a strategic review by its board of directors, it has adopted an updated strategy, being an orderly realisation of its investments with a view to maximising return on investment for Symphony’s shareholders.
Symphony has long offered investors exposure to rising disposable incomes and wealth in fast growing economies, together with providing superior capital growth by investing in high quality companies with long-term business partnerships. However, Symphony’s share price has, over an extended period of time, continued to trade at a material discount to its net asset value.
With a view to maximising shareholder return on investment, the board has determined that it is in the best interests of shareholders that the company take proactive steps to realise its investments and for the proceeds of such realisations to be returned to shareholders. Such realisations and returns will occur in an orderly and efficient manner over the medium term. There is no intention to use proceeds from realisations for any new investments, other than any follow-on investments associated with existing investments only where consistent with the updated strategy.
As a direct consequence of the updated strategy, minor consequential changes have been made to the investment management agreement, including the removal of the floor (minimum level) of the investment manager’s compensation. The agreement has also been amended to allow the manager the flexibility to raise new pools of capital should it choose to do so. The company says that it is confident that its management team, which are its largest shareholders, remain duly incentivised to devote sufficient time to execute the updated strategy and maximise shareholder returns during the realisation process.
The NAV fell to 78.62 cents from 89.06 cents over the second quarter of 2023. The decrease in NAV by 11.7% quarter over quarter is due to a decline in value of unlisted investments, particularly in the logistics sector, and the accrual of dividends payable following a dividend announcement on 29 June 2023.
SIHL : Symphony International joins queue for the exit