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NAOS Small Cap Opportunities Company Limited

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

Contango swaps investment managers following AGM

Financial Standard - Nov 28, 2017

The majority of Contango Microcap (CTN) shareholders approved the proposal to remove Contango Asset Management (CGA) as the firm's investment manager at the annual general meeting today. The new investment manager for CTN will be NAOS Asset Management. CTN chair Trevor Carroll said the decision followed a challenging year for the company "due to less than ideal performance, leading to an underperformance against the Small Ordinaries Benchmark. Carroll added that CTN shareholders have also been subjected to "instability, both at the board and investment performance level." [More]

The sad and sorry saga of Contango MicroCap Ltd is taking another turn with the effective takeover of the company for no premium. Indeed, the 6000 mostly small shareholders will pay handsomely for being locked into a tyro funds manager charging the sort of fees enjoyed by the industry's stars. What's more, the mob grabbing control of CTN (Contango's ASX ticker code) is not even bothering to wait for shareholder approval at Tuesday's annual general meeting before radically changing the company, selling off much of the existing portfolio and moving from a 10 per cent cash holding to 42.25 per cent in less than a month. [More]

The twisting story of Contango Microcap has taken on yet another strange turn, with directors ousted by shareholders at an EGM earlier this year urging the same shareholders to vote against the latest reconstitution of the listed fund. They argue it's more geared to reward the current investment manager than unit holders. The ex-directors are the vehicle's founder David Stevens, along with Ian Ferres and Glenn Fowles. Heavyweights of the Melbourne business community, they were nonetheless removed from the board in March following a high-profile and bitter campaign that questioned their judgment and their directors' fees. The EGM, requisitioned by shareholders associated with investment manager Contango Asset Management, moved for their dismissal after they appointed a second investment manager to manage a small portion of the fund in a bid to improve its investment returns, which had been poor. [More]

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]

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