LICs targeted as Wilson’s WAR lists
Wilson Asset Management will list its Strategic Value (WAR) fund on the Australian Securities Exchange (ASX) today, targeted discounted listed investment companies (LICs) and trusts.
The fund was meant to list on 25 June but was delayed due to the COVID-19 situation in Sydney.
Its initial public offering closed on 10 June and exceeded the $225 million maximum subscription.
The fund would look to take advantage of market mispricing opportunities including securities trading at discounts to assets or net tangible assets with the main focus being on LICs.
Geoff Wilson, lead portfolio manager at Wilson, said: “Myself and the team will be investing capital in these discounted asset opportunities, primarily listed investment companies and listed investment trusts trading at a discount to their underlying asset values. We will be working with the investee companies to assist in closing their share price discount to net tangible assets.
“If you have a closed-end fund that owns other listed entities, it is very easy to work out what that company is worth. You can do this on a per share basis and the price it is trading at. If there is a big discount then you question if there is a catalyst or event that is going to change that valuation to drive it from a discount to NTA, to a premium to NTA. That is the opportunity we are looking for.”
In May, Wilson said there were 15 LICs which could be purchased and were at different levels of maturity while, over the long term, the portfolio was expected to average between 10-30 holdings.
It would aim to pay fully franked dividends and any fully franked dividends received from LICs would be invested onto shareholders.
AUTHOR
Laura Dew
Recommended for you
Bentham Asset Management has become the latest fund manager to expand its distribution team as it reports increased interest in its credit strategies.
L1 Capital, which is in talks to merge with Platinum Asset Management, has indicated it will be voting against a deal to convert a Platinum LIC into an ETF.
Evidentia Group has hired a head of quantitative investments who joins the investment firm and managed account provider from AMP.
Fidelity International has worked in tandem with Australian wealth manager Emanuel Whybourne & Loehr to launch an actively managed global equities strategy aimed at financial advisers.
