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AFX News Limited
Absolute Capital to restructure 5 equity funds
09.21.07, 4:25 AM ET
LONDON (Thomson Financial) - Absolute Capital Management Holdings Ltd (ACMH) said it will restructure five equity funds, to enable orderly management and sale of illiquid assets, while the remaining three funds will continue broadly as before.
Redemptions have been suspended on Absolute European Catalyst Fund Ltd, Absolute Octane Fund Ltd, Absolute Return Europe Fund Ltd and Absolute East West Fund Ltd.
Absolute Activist Value Fund Ltd will transfer its illiquid portfolio assets to a side pocket and issue side pocket shares to investors.
The company's management has held informal discussions with a large number of investors representing a significant proportion of assets under management, and is pleased to report that such investors' initial responses to the proposal have been positive, it said.
Absolute Germany Fund Ltd and Absolute India Fund Ltd hold illiquid assets at 2 pct and 5 pct, respectively. 'Unfortunately due to the instability and loss of investor confidence caused by (founder and co-chief investment officer) Florian Homm's sudden resignation, these funds have experienced high levels of redemption requests,' ACMH said.
Thus redemptions will be suspended for the Oct 1 2007 and Nov 1 2007 dealing days. The funds' portfolio managers have converted a significant portion of the funds' assets to cash, ACMH added.
It anticipates that these funds will reopen to subscriptions/redemptions in not more than 8 weeks.
Absolute Large Cap Fund Ltd's portfolio is highly liquid. Thus no restrictions on redemptions are needed as the fund will be able to meet redemption requests in the normal course, ACMH said.
TFN.newsdesk@thomson.com