Discount triggers Signature move

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Discount triggers Signature move

By Brian Robins

Listed investment fund Signature Capital Investments has outlined plans for a share buyback which will deliver control of the company to interests associated with Andrew Roberts, whose family founded the construction group Multiplex.

Signature Capital said it will buy back up to 25 million shares – equal to 37 per cent of the capital – offering 98 per cent of the net asset backing to any shareholders who accept the offer.

Through RF Capital, the Roberts family already controls 42.8 per cent of the capital of Signature Capital, which has investments in a range of funds valued at $25.4 million (or 37.7¢ a share). It also has significant potential tax losses totalling $40.9 million (61.1¢ a share).

SGI's shares continue to trade at a steep discount to their asset backing, which has triggered the planned buyback. RF Capital may emerge with as much as 68.3 per cent of the company's capital if the flagged buyback of 25 million shares is completed as outlined.

Signature Capital directors said on Monday that they have been concerned for some time about the discount the shares have been trading at relative to the net asset backing per share.

"The Board has also been concerned about the costs associated with maintaining an ASX listing, particularly as ... net assets have reduced in the past 18 months and where there has been a relatively low volume of trading in [its] shares," the directors said in a statement.

The proposed share buyback would give shareholders the opportunity to sell at close to the asset backing, it said.

Private investment interests associated with Sydney fund manager Mr Geoff Wilson are the second largest investor in Signature Capital after the Roberts family, with a 10 per cent stake.

"We will review the proposal, and respond accordingly," Mr Wilson said.

Signature Capital shares gained 2¢ to 30.5¢ in trading on Monday.

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