WTR.L Regulatory News (WTR)

London, UK, 4 August 2016

Edison issues review on Lazard World Trust Fund (WTR)

Lazard World Trust Fund (WTR, formerly The World Trust Fund) seeks capital growth by investing globally in closed-end funds and holding companies that are trading at a discount to the value of their assets. Part of its approach involves working with portfolio holdings to unlock this value, and recent moves by the fund show it is prepared to practise what it preaches. So far in FY17, WTR has changed its name to link it more explicitly with its manager since launch in 1991; adopted a new benchmark that better reflects the make-up of the portfolio; announced a tender offer for up to 10% of shares at 98% of NAV minus costs; and proposed a new dividend policy, whereby investors will receive a distribution of 3.5% of the year-end NAV. Strong recent NAV performance has propelled the fund close to the top of its peer group over one, three and five years.

WTR's managers note that the level of discount on the fund's holdings is currently at its widest level since the global financial crisis, averaging 28.1% at 30 June. WTR's own discount to NAV at 1 August stood at 11.8%, narrower than the averages over one, three and five years. Applying this discount to the portfolio discount gives a combined discount of 36.7%, meaning that each £1 invested buys £1.58 worth of assets based on underlying NAVs. WTR's discount narrowed sharply after the announcement of its new distribution policy at the end of June, suggesting the move has been well received.

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