ICAP AGM over, Tan Teng Boo and ICAP BOD got overwhelming support from shareowners

The 8th AGM of close-end fund iCapital.biz Bhd (ICAP, 5108) which lasted from 9am to 3pm (with 2 hours lunch break to allow calculation of votes to Resolutions #3 onwards) on 10 November 2012 was finally concluded, with overwhelming support given to Tan Teng Boo and the current BOD of ICAP. It is still very far away for Laxey Partners to attempt to obtain a seat in the BOD of ICAP.

About 2000 shareowners have attended this AGM, and apparently 99.8% of the attendee headcounts are on Teng Boo's side, while 0.2% in the hall was in favour of Laxey.

Laxey Partners has recommended to use share buyback mechanism to try to minimize the discount gap between the ICAP's share price and its net asset value (NAV), which we still unsure if it is approvable for CEF in Malaysia to do so, and the method is not bulletproof and has no guarantee whether will really work or not, and even if it works, it "will only benefit short-term traders" as said by Teng Boo.

Meanwhile, Teng Boo has revealed an innovative way of introducing a dual-listing global fund with attached warrants to address the discount gap issue. He didn't disclose much as he is still working on it, and said that hopefully it will be materialized in early 2013.

From the percentage of votes casted to the resolutions, it is clear that City of London Investment Management Company Ltd. was not on Laxey's side. I doubt they are on Teng Boo's side too. They possibly did not cast any vote.

Although Teng Boo managed to beautifully win the battle this round, he has to really ensure that his proposed "dual-listing global fund with attached warrants" can get materialized and can really work. If not, that will be a good attack point from Laxey, and Teng Boo might not be getting as much support from ICAP shareowners again if he failed to deliver.

Teng Boo and the new 7-people BOD must work really hard for ICAP to sustain the victory and avoid subsequent attack. This should be good to all the shareowners of ICAP, including Laxey. After all, we believe Laxey is here to gain money from investment, and not to make trouble for no reason.

Disclaimer: This article is intended for sharing of point of view only. It is not an advice or recommendation to buy or sell any of the mentioned stock counters. You should do your own homework before trading in Bursa Malaysia.

The upcoming AGM of ICAP on 10 November 2012 will be crucial for all shareowners

Most of the shareowners of close-end fund iCapital.biz Bhd (ICAP, 5108) have been wondering why the AGM of this year comes so late.

It was 2 weeks after the announcement made on 18 October 2012 about its 8th AGM to be held on 10 November 2012, an Addendum to the 8th AGM notice has been dispatched through Bursa Malaysia's Company Announcements webpage, that a shareowner named Ms. Evelyn Ho is nominating 3 persons (including a foreigner who is the CEO of Laxey Partners) to enter the board of directors of ICAP. On the other hand, the present BOD is also nominating 2 more friendly partners to contest for the directors election.

As you might notice, the share price of ICAP has been trading at discount to its NAV since 2008, and the gap has widen to more than 20% from 2011 until today. This is a good investment opportunity for anyone who want to invest in ICAP with discounted price to its NAV. In addition, ICAP fund management has been performing well, with its NAV keeps rising despite the discount in its share price.

Then, we saw a foreign fund City of London Investment Management Company Ltd. emerged as substantial shareholder of ICAP since August 2011 and keeps on accumulating until holding about 7% of ICAP to date. Later, we also saw another foreign fund Laxey Partners Ltd. also emerged as substantial shareholder of ICAP since April 2012 and also keeps on accumulating until holding about 7% of ICAP to date. 

Laxey Partners Ltd. has many track records of accumulating the shares of close-end funds at discount, then getting into the BOD of the fund, replace the chairman/CEO and hostily take over the control of the fund. The sudden nomination of 3 persons apparently from Laxey Partners Ltd. to ICAP's BOD is definitely a threat to the existing BOD, and if the replacement of the directors does happened, it will affect the fund's future direction and hence affect the interest of all ICAP shareowners.

According to its 2012 Annual Report, ICAP has 3000+ shareowners, of which about 65.8% are held by about 2,000 minority holding 100-10,000 shares. CDAM, the fund manager, also holds about 0.5% of the shares.

In its Annual Report, ICAP reiterates that it "exists for one simple reason : to allow long-term shareholders or more aptly called share owners, to benefit from value investing. Investing in your Fund allows the power of compounding to work for you. If we succeed in achieving this, we would have also shown that serious long-term investing in Bursa Securities can offer superior returns." This is inline with its IPO Prospectus stating the investment strategy to be "intelligently eclectic".

If the existing shareowners want to maintain ICAP's investment philosophy and agree that the fund has been well managed and the present BOD has been taking care of the interest of all shareowners, they should show support to the existing BOD during the coming AGM.

Anyway, let's see what Laxey Partners going to propose, and what the existing BOD and the fund manager is working on to enhance the value to the shareowners. If City of London is on their own, we might see a triangular war, else, we'll see a cut-and-thrust war. The party who can convince the minority shareowners with 65.8% holding will be the winner, but the minority shareowners must be present to the AGM or appoint proxy the exercise their rights.

That's why, the upcoming AGM of ICAP is very crucial to the fate of ICAP.

Disclaimer: This article is intended for sharing of point of view only. It is not an advice or recommendation to buy or sell any of the mentioned stock counters. You should do your own homework before trading in Bursa Malaysia.

The Edge Financial Daily app for smartphones and tablets

Digital format of The Edge Financial Daily business paper has been made available to smart mobile devices including iPad, iPhone, iPod, Android smartphones and Android tablets for quite some times.

It is delivered with the free The Edge Financial Daily app available in Google Play Store and iTune AppStore. Currently, the digital format of the paper can be downloaded for free too.

However, this app doesn't bring good and convenient user experience to its readers yet, and still need quite a lot of improvement.

• The app is running on Adobe AIR, which requires user to install Adobe AIR app before able to run The Edge Financial Daily app. Adobe AIR consumes about 9 MB of storage space of your smartphone/tablet.
• Before we are able to read the paper, we need to download it from the Internet. The file size is around 30 MB per paper, taking some times to download, and consuming quite a lot of precious storage space of your smartphone/tablet too. Worse still if you are not connecting to the Internet via WiFi or HSDPA and need to download with slow speed, it really tests your patient.
• Probably because it is an Adobe AIR app instead of native app, its navigation respond is sluggish, page loading and rendering is slow too.
• The navigation buttons don't respond well. Sometimes need to tap a few times before it start working.
• It does not support multi-touch gesture. To zoom the text, you need to double tap the screen instead of pinching.
• I don't find any feature to jump to a particular page. Everytime you open the paper, you need to start reading from its cover page.
• Deleting the downloaded papers (especially to save valuable storage space) is a pain. There is no multi-select deletion. You need to delete the files one by one, and each deletion takes a few steps to complete.

It is very nice to be able to read the digital format of The Edge Financial Daily anytime, anywhere with our smart mobile devices. With this digital format delivered through the Internet, we no longer need to look for the paper in newspaper stand, or need to wait for the paper boy to deliver at our doorstep. Being paperless, it is environmental friendly too.

However, it would be better if the app can be redeveloped as native app instead of using Adobe AIR, optimize on the download time and file size, and improve on user interface and experience.