News

RAB investors approve Special Sits lock-in

30 September 2008 12:57:00

Investors in hedge fund manager RAB Capital's Special Situations Fund have agreed to commit their money for three years to keep the fund going.

They voted by a "considerable margin" to approve a three year lock-up, which should ensure the "long-term stability of the strategy so as to provide a better prospect for the generation of value in the underlying investments."

The proposal, announced earlier this month, will see management fees halved to just 1% and performance fees cut to 15% from 20%.

RAB blamed the need for restructuring on a very weak market for early stage natural resources and other development stocks, and poor liquidity.

The Special Situations fund lost 22% of its value in August, taking the predicted reduction for the year to date to 48%. Assets under management at the fund were estimated to be $790m as at 25 September.

The decision was a relief for Oxus Gold and exploration outfit Falkland Oil & Gas. RAB has "significant" interests in both and may have liquidated the funds had the vote gone the other way.

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