(Alliance News) - Highbridge Tactical Credit Fund Ltd on Monday said its net asset value per share dipped slightly in 2019 following substantial shareholder exodus amid the unwinding of Highbridge Multi-Strategy Fund Corp.
The credit investment fund's NAV per share as at December 31 was GP2.1233, down 1.3% from GBP2.1518 the year before.
Highbridge Tactical's investment manager, Highbridge Capital Management LLC, restructured its business to focus on credit and convertible bond-based investment. Highbridge Tactical suspended share repurchases while consulting shareholders as the the company's future.
These consultations revealed that there was "limited appetite for a completely new manager" and thus the firm offered the opportunity for shareholders to receive either cash distributions from Highbridge Multi-Strategy Fund as it unwound or re-invest in Highbridge Tactical Credit Master Fund LP. Since the Highbridge Tactical Credit Master Fund investment, NAV per share has fallen 2.2%.
"The final quarter of the year saw the asset value of the company shrink from over GBP200 million to approximately GBP50 million as a significant number of shareholders elected to exit. To avoid shareholders being trapped in an illiquid sub-scale company, the board has committed to hold a discontinuation vote to wind up the company if the company's NAV is not above GBP80 million by the end of 2020," said Chair Vic Holmes.
Holmes noted the Covid-19 pandemic and its " significant negative impact on global markets", with "the full economic impact" potentially taking "some time" to become clear.
Holmes said: "It is noteworthy that the company's NAV performance is broadly flat for the 3 months to 31 March 2020, and therefore your board has been surprised and disappointed at the current relatively high level of share price discount being of the order of 15%.
"It is our intention for the investment manager to commence an aggressive marketing campaign as soon as the current Covid-19 restrictions are lifted sufficiently to enable them to do so. The investment manager strongly believes that the company now has an extremely compelling investment portfolio which will deliver strong performance over the rest of the year."
Shares in Highbridge Tactical were flat at 179.00p in London on Monday afternoon.
By Anna Farley; annafarley@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.