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Gabelli Value Plus+ faces litigation threat

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Gabelli Value Plus+ faces litigation threat as liquidation row rumbles on

Board sets out further consultation period to 14 October
Ellie Duncan, Investment Week, 06 October 2020

In an update today (6 October) the board said it has initiated a further period of shareholder consultation which it said was “regrettably, partly in response” to the letter.

The board stated that it still backs members’ voluntary liquidation of Gabelli Value Plus+, in the belief that “it would be in the best interests of the company and its shareholders as a whole”.

It said that the “resounding feedback from an absolute majority of all shareholders is that they want a liquidation of the company and return of their (and their underlying investors’) capital as soon as practicable”.

ACG, which is the majority shareholder in Gabelli, has previously blocked a proposed liquidation vote even after two-thirds of shareholders voted against continuation at its July AGM.

The board has said it will consult further with shareholders during a consultation period which runs from today (6 October) to the close of business on 14 October and that while it was open to suggestions during the consultation period, it believed that there are three main options currently under consideration to be put to a general meeting…

In response to the latest developments, James Carthew, head of investment company research at QuotedData in a post on its website today (6 October), stated that while its idea about a dividend has been rejected on tax grounds, “a tender offer achieves much the same result – almost all of the cash comes back to shareholders”.

He added: “A large shareholder that doesn’t take up the tender might be forced to make a mandatory bid for the whole company, otherwise there might be a rump trust which would most likely ask shareholders for permission to liquidate once again.”

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