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****Investment Philosophy, Strategy and various Valuation Methods****
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PETALING JAYA (Nov 7, 2012): Tan Teng Boo, managing director of Capital Dynamics Asset Management Sdn Bhd (CDAM) which manages icapital.biz Bhd, has announced his and the company's intention to retire as the fund manager of the closed-end fund listed on Bursa Malaysia, ahead of icapital.biz's AGM on Saturday.
This follows the nomination of three individuals, namely Andrew Pegge, Lo Kok Kee and Low Nyap Heng to be part of the fund's board at the upcoming meeting.
In a statement yesterday, Tan said having such individuals on the fund's board would threaten its continued success, which has been delivering an annual compound return of 18% per year since its listing on Oct 19 2005.
"The objective of the three nominees is not only contradictory to the long-term vision of icapital.biz, but also detrimental to the sustainability of the fund's future.
"Based on their previous track records, the three individuals are only concerned with short-term gains, while ignoring the interest of the majority of the share owners in the long run," he said.
Tan warned that if any one of the three persons is voted in at the AGM, CDAM will "seriously reconsider" its position as the fund manager and retire "because our philosophy, values and objectives are diametrically opposite to theirs".
"CDAM works hard at building sustainable long-term values, based on principles of integrity."
Tan also pointed to the track record of UK-based Laxey Partners Ltd, the firm of Pegge, which he described as "extremely disappointing".
He cited the share price of The Value Catalyst Fund, a closed-end fund launched by Laxey Partners in December 2005, which had plunged by 58% when it was suspended in June 2011.
"Another fund managed by Laxey Partners, The Terra Catalyst Fund, has consistently traded in discounts since it was launched in Feb 2008.
"In addition to its poor performance as a fund manager, Laxey Partners and Pegge were fined 1 million Swiss Francs by the banking regulator from Switzerland in 2008," he said.
Shares of icapital.biz closed up 7 sen at RM2.56 yesterday, with 789,300 shares traded.