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Contango MicroCap

Fund Manager: Contango Asset Management
Inception Date: Mar 01, 2004

A little over a year ago, during Contango's high-profile listing on the ASX, its MD and chief investment officer George Boubouras heralded an end to performance fees. A majority of the firm's investment staff had signed contracts under which they would take equity stakes instead of bonuses for outperformance. This was meant to shift the focus from short- to long-term performance, while retaining profits that could then be distributed to shareholders. A novel but perhaps necessary innovation in a market increasingly dominated by low-cost index funds.  Contango announced Boubouras' abrupt exit from the business he headed last Friday. He's being replaced in the interim, it seems, by Contango board member and occasional TV host Marty Switzer. [More]

Contango microcap cuts directors' fees

Money Management - May 03, 2017

Contango MicroCap, an ASX-listed investment company (LIC) investing in entities with a market cap of up to $350 million, has announced a reduction in directors’ fees with immediate effect as well as a review of the second manager appointed by the company’s previous board. Under the new terms, the fees being paid to each incoming non-executive directors, Trevor Carroll and Ken Poutakidis, would be $30,000 per annum while the fee of chairman, Mark Kerr, would be reduced to $60,000. The company also said that non-executive director, Alistair Drummond did not receive any fee for his role. What is more, no additional fees would be paid for membership of board committees. [More]

Power plays behind bitter battle for Contango

The Australian - Mar 25, 2017

The battle for control of $172 million listed investment company Contango MicroCap is going down to the wire. But with just days ahead of a vote on whether to punt three directors — stalwarts of the Melbourne business scene — shareholders are still mostly uninformed about what has prompted the governance turmoil between the small cap investor and a James Packer-backed fund manager. Shareholder letters, obtained by The Weekend Australian and sent to the three “independent” directors who are the subject of resolutions to remove them from Contago MicroCap’s board — Ian Ferres, David Stevens and Glenn Fowles — reveal a bitter battle to wrest the governance of the fund back from the men, who allegedly have drawn high directors’ fees for more than a decade. [More]

There's an extraordinary battle underway in a relatively small listed investment company (LIC) that tangentially involves the well-known names of James Packer and Peter Switzer. It raises important questions about the fiduciary duties of brokers operating discretionary accounts and the governance responsibilities of a chairman during an attempted takeover of the board. In some decades of observing corporate governance behaviour, I can't recall seeing anything quite like what's happening at Contango MicroCap, where the chairman, Mark Kerr, is making no recommendation on attempts by two individuals to unseat three quality directors. [More]

In funds management, where people and performance are everything, James Packer's latest deal is highly unusual. Mr Packer's $13 million investment in Contango Asset Management  demands that certain key staff at the Melbourne-based boutique accept that they will not be paid bonuses, and instead take equity stakes in the business.   It's a model that George Boubouras, the fund's chief investment officer who led the management buyout of of Contango that Mr Packer and his chief aide Rob Ranking have backed, hopes will serve as a template to better align the interests of staff, owners and clients.   He suspects they may be forced to do it anyway, as large institutions such as sovereign and pension funds demand changes to the way fund managers and their staff reward themselves. [More]

Contango AM announces management buyout

InvestorDaily - Jun 27, 2016

Contango chief investment officer and director George Boubouras said the buyout is the “first step in an exciting future” for the business. “The Contango Asset Management team is highly motivated to grow the business into one of Australia’s pre-eminent fund managers,” he said. “We look to the future success of the business with great enthusiasm and confidence.” Pacific Point Partners, an investment vehicle controlled by James Packer and Robert Rankin, will be a cornerstone investor in the sale, with a subscription of 19.9 per cent in the transaction. Contango Asset Management is responsible for a number of listed investment companies including Contango Income Generator (ASX: CIE), whose chair supports the transition. [More]

Contango Asset Management's investment chief George Boubouras has been hitting the pavement up the Paris end of Melbourne's Collins Street spruiking a new "nano-cap" fund. The fund is rumoured to be targeting $50 million to $100 million and is expected to be born as a spin-off to Contango's 12-year old listed microcap investment company. The pitch is understood to be all about finding a home for those tiny beauties Contango's team comes across. It's expected to seek out stocks with a sub-$30 million market capitalisation, which makes them too small for the existing microcap mandate.  It is not known yet whether the new nano-cap fund will be structured as the group's third listed investment company.    Contango launched its second LIC, the $71.5 million income generator fund, last year. It has been a busy 18 months for the former Equity Trustees and UBS Asset Management investment chief Boubouras since he joined Contango in December 2014.   [More]

It’s official, the Australian Share Market has gone nowhere in the last 10 years. Referred to by some as Australia’s Lost Decade, the ASX 200 index closed at 5,310 on May 1 2006, and almost the same level of 5,252 on April 29 2016. What’s been missed in this comparison however is the impact of dividends on returns. Performance of shares including Exchange Traded Funds (ETFs) and Listed Investment Companies (LICs) is generally reported on their share price movements over time ... [More]

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