AMP Capital, the responsible entity (RE) of the AMP Capital China Growth Fund (AGF), has announced that unitholders are likely to vote in favour of winding up the fund at tomorrow’s extra-ordinary shareholders meeting (EGM).
The fund manager based the announcement on the number of valid proxies it received ahead of the meeting, which indicated that the institutional unitholders were unlikely to support the RE’s resolution to keep AGF in operation.
Chairman of AMP Capital Funds Management, Adam Tindall, said the company had been working with KPMG, which said it would take between nine to 18 months to return capital from China to unitholders.
LIM Advisors, which owns more than five per cent of the outstanding units of AGF and submitted the resolution to wind up AGF, strongly disagreed on this time period, stressing that the entire portfolio of A shares could be liquidated much faster, even “in a few trading days”.
Tindall added that if LIM Advisors’ resolution was passed, AMP Capital “will move to wind up the fund and return the capital to investors as quickly as possible”.
However, he did not specify how many tranches the transaction will take.
At this stage, AMP Capital did not announce any plans for setting up a new fund if AGF was voted to be liquidated.
“Following tomorrow’s EGM, where the wind-up outcome is likely to be confirmed, we will consider the best and fairest way to implement the decisions made at the meeting, working on behalf of all unitholders to get their funds back to them as quickly as possible,” the firm said.
AMP Capital also stressed in its statement that there the “vast majority of retail unitholders by number have supported the RE’s resolution to keep AGF in operation with some enhancements to improve the fund and make it more cost effective”.
LIM Advisors was seeking to wind up AGF due to concerns over the fund’s RE, which, according to LIM, had “failed to take action to reduce the fund’s problems, in particular, an excessive discount to net asset value (NAV)”.
Additionally, last week, the New South Wales Court of Appeal ruled that AMP Life, the largest unitholder of AGF, was excluded from voting its AGF units at the EGM.
