Castle Alternative Invest AG, a fund of hedge funds listed on the SIX Swiss Exchange and on the London Stock Exchange, authorised the board to effect a share buyback programme at its Annual General Meeting (AGM) held on 15 May 2012.
Under the programme a maximum of 10 per cent of the Company’s share capital (up to 1,635,281 shares) can be repurchased. The effective size of the programme remains at the discretion of the board in light of available portfolio liquidity, the number of shares already purchased and market conditions.
Dates for the share buyback programme have now been confirmed. It will be executed via a second trading line denominated in CHF which will be opened on the SIX Swiss Exchange on 28 June 2012, and will remain open until 5 June 2013 at the latest. The Company will be the exclusive buyer on the second line and will repurchase shares for the purpose of subsequently reducing its share capital. Zurich Cantonal Bank will be the SIX Swiss Exchange member responsible for setting bid prices on the second line. For shares purchased on the second trading line, Swiss federal withholding tax of 35% of the difference between the repurchase price and the nominal value of the shares (CHF 5) will be deducted from the price.
The AGM also approved a share capital reduction by way of cancellation of 1,128,779 shares, being the number of shares that had been purchased in last year’s second line buyback programme up to 17 April 2012. The cancellation will occur shortly after 24 July 2012.
The Company, which has assets of approximately USD 245 million, was listed on the SIX Swiss Exchange in April 1997 and has been dual listed in London since June 2009. Castle AI invests in a diversified and actively managed portfolio of hedge funds, managed accounts and other investment vehicles in order to target long term capital growth.
Castle AI has achieved a net annualised return of 6.16% since inception in US Dollar terms*, compared to an annualised return of 2.45% for the MSCI World Index, with correlation to the index of 0.49. Thomas Weber, head of hedge fund investment management, LGT Capital Partners (LGT CP), has been lead portfolio manager since launch.
Mark White, co-head of listed investment companies, LGT CP, says: “The board of Castle AI believes in an active approach to managing the discount to net asset value and has implemented this programme to support the price at which shares trade in the secondary market. The Company has a long track record of delivering positive returns, proving an effective investment vehicle for investors wishing to enhance their portfolio diversification. The second trading line should help to tighten the discount, and should result in a share price which better reflects the value of the Company and the quality of its underlying investments.”