Basis said it is unlikely to lift the existing suspension of redemptions on the Basis Pac-Rim Opportunity Fund in the short to medium term.
Basis Capital Funds Management said it is unlikely to lift the existing suspension of redemptions on the Basis Pac-Rim Opportunity Fund in the short to medium term due to continued global market deterioration and volatility.
The redemption freeze will stay in place as it deals with the legacy issues contemplated in April, the firm added.
Basis advised investors in a letter they would get a fourth return of capital by way of a compulsory redemption.
The distribution represents a further $42.31 million (US$34 million) or around 90 per cent of the Basis Pac-Rim Opportunity Fund's net asset value at the end of April.
This will mean that to date over $265.06 million (US$213 million) will have been returned to investors, leaving a small amount of cash and legacy issues to work through with little indication as to how long they may take to finally resolve, Basis said.
Additionally, Basis advised investors of the sale of Basis Pac-Rim Opportunity Fund's remaining structured credit portfolio. The portfolio consisted of complex structured products known as collateralised debt obligations.
"In the circumstances, the value of the structured credit portfolio has now been practically exhausted, and given that the ongoing costs of holding the securities may shortly exceed future anticipated cash flows from those securities, it is the investment advisor's view that there is little continued benefit to investors in continuing to hold the structured credit assets," Basis said.
The Basis Pac-Rim Opportunity Fund suspended redemption requests from September 2007 onwards, as the US sub-prime market imploded.
In early 2008, the directors of the fund announced their intention to undertake an orderly wind-down of the fund.
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