FUND manager Wilson Asset Management is raising up to $100 million through a share purchase plan in its popular WAM Capital listed investment company (LIC).
The purchase plan — the latest investor offering in the booming LIC segment — is on offer to existing shareholders at a fixed price of $1.90 per share. That comes at a discount to the $2.04 close on January 9, the record date of the SPP.
Shareholders will be able to acquire up to $15,000 worth of shares in the LIC without incurring any brokerage or other costs. Participating shareholders will be eligible for the 7 cent fully-franked dividend, payable on April 30. The SPP offer will close on March 5.
More than a dozen asset managers are hoping to launch vehicles this year and lock in permanent capital to invest in Australia and abroad.
Over the past two years, LICs — close-ended funds that are tradeable on the stock exchange — have again found favour with Australian investors, particularly retirees, who have chased safe-haven investments to park their rapidly-growing $1.9 trillion savings pool in superannuation funds.
In 2014, LICs raised total capital of $1.5 billion, including 15 new offerings.
Large fund houses, such as Investors Mutual and Perpetual, which already hold billions of dollars in funds under management, were among those that jumped on to the LIC bandwagon last year.
The industry’s market capitalisation jumped to $26.4bn by the end of December, with 65 listed funds.
WAM Capital (WAM), listed in 1999, held gross assets of $621m as at December 31, 2014, and had pre-tax net tangible assets (NTA) of $1.77 per share. More than half of the gross assets were allocated in Australian equities, with the remaining 48.4 per cent held in cash.
Wilson Asset Management manages two other LICs — WAM Research and WAM Active. All three traded at a premium to their NTA as at December 31, ASX data showed.