Vision Opportunity China Fund, a closed-ended fund traded on AIM that seeks investments in SMEs with operations principally within Greater China, has launched a set of initiatives that are designed to further improve the liquidity in the trading and rating of VOC’s shares and enhance shareholder value.
It is introducing a distribution policy which aims to return to shareholders an amount equivalent to between 20 per cent and 50 per cent of the company’s relevant net realisation proceeds achieved in each financial year.
It is also implementing a share buy-back policy and moving the company from AIM up to the London Stock Exchange’s Main Market.
Subject to shareholder approval at an extraordinary general meeting of VOC to be held on 4 May 2010, a return of capital of five cents per share, amounting to USD3.31m in aggregate, will be paid on 28 May 2010 to shareholders on the register as at close of business on 7 May 2010.
This payment will be funded through a reduction of share capital and will be taken into account for the purposes of the company’s new distribution policy. It is equivalent to 15.3 per cent of the relevant net realisation proceeds in the current financial year to 31 March 2010 and 1.8 per cent of the net asset value as at 31 March 2010.
Since its admission to AIM in November 2007, VOC has delivered a net asset total return per share of 191.4 per cent, which compares with a fall of 24.7 per cent in the MSCI China Index total return over the same period. However, the company’s shares are trading at a substantial discount to their underlying net asset value (currently 27.7 per cent).
The proposals aim to introduce transparent distribution and share buy-back policies; use share buy-backs to enhance value for ongoing shareholders; improve VOC’s market profile and visibility, particularly amongst UK-based institutions, private wealth managers and other investors; continue to broaden and diversify VOC’s shareholder base; and enhance liquidity in VOC’s shares.
