The Invesco-managed GT Japan investment trust is prepared to buy back up to 45% of its shares to red...
The Invesco-managed GT Japan investment trust is prepared to buy back up to 45% of its shares to reduce the discount to NAV.
Existing shareholders will be able to sell back at a 6% discount to NAV following a prolonged period of volatility in the Japanese market. As of last week the trust was on a discount of around 10% with an NAV of approximately 290.8p per share.
The buy-back decision will be ratified at an emergency general meeting which is to be held on 11 October
Managing director of specialist funds at Invesco, Graeme Proudfoot said: "The Japanese market has been pretty volatile over the course of this year, share prices, particularly in 'new Japanese' companies had performed strongly through February but then fell sharply from their peak towards the summer.
"That said, GT Japan's net assets still grew by over 35% in the year to 30 June 2000."
Proudfoot believes the outlook for the Japanese economy and stock market is encouraging.
Economic growth is forecasted at 2.2% and Invesco's Tokyo office predict profits growth of between 20% and 50% amongst well managed Japanese companies
According to Proudfoot, the tender offer is intended to provide shareholders wishing to reduce their Japanese weighting, a portion of whom have been pushing to sell for some time, with the opportunity to do so.
He anticipates that the tender should provide remaining shareholders with a boost of around 3.5-4% in NAV per share if it is fully taken up, the purchase costing GT Japan roughly £85m.
He said: "We hope that both the remaining shareholders and those that sell will benefit from this exercise."
An ambitious objective
'Something completely new'
'Illusion of control'
Reasons to be cheerful
Total investment reaches £9m