The board of Watermark Market Neutral Fund (WMK) has announced its intention, subject to approvals, to restructure it as an unlisted fund.
The proposed transaction would be expected to address the net tangible asset (NTA) discount as WMK shareholders would be issued units with a value reflecting the company’s NTA, after transaction costs.
Secondly, the transaction would provide shareholders better exposure to an unlisted investment vehicle, with lower operating costs and liquidity at NTA, the board said.
Additionally, the new transaction would offer shareholders access to founder units in the new trust, with wholesale pricing.
The company said the total cost of implementation the scheme would stand at approximately at 0.4 cents per share of WMK’s NTA.
Watermark Funds Management also revealed that another of its funds was proposing to implement a similar scheme.
Until the scheme is approved, WFM would continue to manage the company’s portfolio in accordance with its existing investment mandate, the firm said.