K2 Asset Management will close its listed investment trust, K2 Global Equities Fund, offering investors a transfer to the unlisted version of the fund or a final distribution.
Trading in the listed trust, which listed in July 2015 and has $4 million of funds under management, was suspended this week to facilitate an orderly windup.
K2 says the unlisted version of the fund, K2 Global High Alpha Fund, which is open for investment, has been the more popular vehicle for investors.
The listed fund will close on November 29. K2 will waive the buy/sell spread for investors who want to transfer into the unlisted version or any other K2 fund.
The fund has had poor performance over the past year, falling by more than 10 per cent over the year to September.
There have been a number of exits from the LIC market this year.
In September, LIC Clime Capital completed the takeover of CBG Capital.
CBG’s executive chair Ronni Chalmers, who is involved with the investment management teams of both LICs, says: “These things need size. The merged LICs have a market cap of around $140 million.
“If you do not have sufficient scale you will have the problem of your shares or units trading at a discount. And if you don’t do anything to fix that, shareholders will get involved.”
In April, LIC Chapmans Ltd received the support of shareholders for a proposal to remove the company from the Australian Securities Exchange.
The board put the proposal to delist to shareholders after coming to the view that listing fees and other compliance costs were too high, given the company’s market capitalisation. Another factor was that compliance with listing rules caused delays in implementing its strategy.
And the board felt the value of the company’s shares did not reflect the value of its investments.
In February, Century Australia shareholders voted in favour of a proposal to merge their company with another listed investment company, WAM Leaders.