James Carthew: It’s time to invest in Polar Cap Healthcare – not cash out
Shareholders are eyeing up the trust’s upcoming tender offer but stand to benefit more by remaining invested.
Polar Capital Global Healthcare (PCGH) is doing the rounds with investors ahead of its liquidity event. Towards the end of November, shareholders in PCGH will need to decide whether to take advantage of PCGH’s 100% tender offer.
There is also a vote to approve the offer, adopt new Articles of Association – the rules that govern the operations of the company – and to allow PCGH to reissue shares from treasury; this is an opportunity to buy shares as well as sell them.
You will know, because I keep droning on about it, that I like periodic exit opportunities such as this and prefer them to more frequent tender offers.
TwentyFour Income (TFIF), for example, provides exit opportunities every three years. I think this encourages long-term thinking by both shareholders and managers. It is an opportunity to place shares as well as allowing an exit close to asset value.
In TFIF’s most recent liquidity event which concluded in October, it bought back £14.4m worth of shares and reissued all of these whilst raising an additional £27.6m. In fact, it has ended up growing the trust at each of its last three liquidity events.
PCGH has a good chance of reissuing stock too…. read more here