Situation

• The board of a former self-managed investment company wished to appoint an independent secretarial resource
• The company secretarial function was performed by a team within the investment manager
• The board wished to adopt some of the recommendations proposed by the Walker review of corporate governance

Solution

• Frostrow Capital was appointed as a special adviser to the board with a brief to enable it to conduct its business independently and according to the latest corporate governance guidelines
• Frostow Capital proceeded to build working relationships with key members of the investment manager in order to act as an effective link between the investment manager and the board
• Both parties were helped to achieve a greater understanding of their respective roles and a clearer division of responsibilities
• A transition plan was adopted by both parties to allow Frostrow Capital to assume the company secretarial function

Result

• Frostrow Capital was appointed as company secretary and now organises board meetings and is a valued source of operational knowledge and strategic advice concerning the running of an investment company
• The board is comfortable that it now complies with some of the most up-to-date corporate governance guidelines
• The investment manager can now focus purely on the portfolio rather than on providing a company secretarial service

Situation

• An investment company faced an uncertain future as its largest shareholder wanted an exit. The share price discount to NAV widened and risked attracting interest from arbitrageurs who, together with the largest shareholder, would force a wind-up of the company

Solution

• Working closely with the company’s broker, the team negotiated a discount at which the large shareholder was happy to exit
• At the same time, the investment mandate of the company was changed to enhance its appeal to a wider group of shareholders
• New shareholders were attracted by the change in mandate and sufficient numbers of them were found to replace the existing shareholder
• The company was the first to adopt a policy of protecting a specified share price discount using share buy-backs and holding them in treasury
• The buy-back policy was supported by active on-going marketing, in order to maintain ongoing demand for the shares

Result

• The action taken led immediately to a re-rating of the shares which encouraged new and existing shareholders to continue to support the company
• The buy-back policy has been successful, with the company’s average discount being one of the narrowest in the sector
• The ability to reissue shares from treasury has enabled the company to grow organically whenever the demand for shares exceeds the supply

Situation

• Since launch the service from the off-shore company secretary and administrators had fallen short of the board’s expectations and requirements
• The board and the investment manager were increasingly having to manage the many individuals involved and there was no central point of contact who could assume overall resposibility
• At the first year end certain directors had to compile part of the annual report themselves in order to meet the required deadline

Solution

• Frostrow Capital was appointed to act as an interface between the board, the investment Manager and the company secretary and administrators
• The role involves overseeing and coordinating the work done by the various parties, includes taking responsibility for the interim and annual accounts production and dealing with the auditors as required
• Frostrow ensures that all work meets the requirements of London-listed investment companies
• Frostrow attends all board meetings and is accessible as an experienced resource concerning all operational and strategic matters

Result

• The board is delighted with the standard and efficiency of the service it receives
• All directors have gratefully reverted to their coveted non-executive status
• The investment manager can focus on other areas