icapital.biz pays a surprise maiden dividend

icapital.biz pays a surprise maiden dividend
Business & Markets 2013
Written by Kamarul Anwar of theedgemalaysia.com
Friday, 23 August 2013 10:45

KUALA LUMPUR: ICAPITAL.BIZ BHD [] will be distributing its maiden dividend since its listing eight years ago, proposing a special 9.5 sen dividend for the financial year ended May 31, 2013 (FY13).

The closed-end fund, which has set its focus on "long-term capital appreciation and sustained compound return", proposes to pay the special dividend on Oct 7. The entitlement date for the dividend is Sept 19.

"This is the first dividend announcement since the listing of icapital.biz on Oct 19, 2005, and may come as a pleasant surprise to most investors," the firm said in a statement yesterday.

The fund said its board, together with the fund manager and investment adviser, would continue to safeguard the long-term interests of the share owners and ensure that the fund continues to perform for the benefit of the share owners based on existing investment objectives.

icapital.biz was earlier embroiled in a controversy when its substantial shareholder and London-based hedge fund — City of London Investment Management Co Ltd — had called for a progressive change at the company.

City of London was represented by activist investor and co-founder of Laxey Partners Ltd, Andrew Pegge.

At icapital.biz' AGM in November 2012, Tan Teng Boo, who heads Capital Dynamics Asset Management Sdn Bhd that manages icapital.biz, stopped Pegge's attempt to gain a board seat.

Laxey had 9.65 million shares or 6.89% of icapital.biz as at Oct 31, 2012 based on filings with Bursa Malaysia. Pegge had told the media that he was seeking board representation in order to get icapital.biz to be more proactive in reducing its stock price's discount to net asset value (NAV).

Pegge also told the media on Nov 8 he intended to stick around at icapital.biz until the discount issue was resolved.

Tan, on the other hand, had said the discount was not an issue for investors who hold a long-term view.

After Pegge failed in his bid to get a board representation at icapital.biz, he ceased to become a substantial shareholder based on a Bursa Malaysia filing dated Nov 27 last year.

However, City of London has since increased its stake in icapital.biz by nearly 3% this year alone.

As at May this year, the hedge fund held 9.13% of icapital.biz shares.

icapital.biz was down by two sen or 0.84% to RM2.35 yesterday. The stock was also at a 21.405% discount to its latest NAV of RM2.99.



This article first appeared in The Edge Financial Daily, on August 23, 2013.