Winding up of HFA fund voted down

Frozen since December

By Vishal Teckchandani
Tue 30 Jun 2009

HFA Asset Management's strategy for the frozen $630 million HFA Diversified Investments Fund has been overwhelmingly supported by its unitholders.

Unitholders have overwhelmingly voted down the winding up of HFA Asset Management's (HFAAM) $630 million HFA Diversified Investments Fund (DIF).

The hedge fund manager suspended applications and redemptions for the DIF on 22 December 2008 due to a technical liquidity issue under the Corporations Act and as such was required, under its constitution, to hold a meeting to consider two ordinary resolutions.

The first was that a withdrawal offer be made by HFAAM to unitholders, which was supported by over 99 per cent of votes. The second resolution was that the fund be wound up, which was voted against by 99.64 per cent of investors.

HFAAM also asked unitholders to approve a new constitution for the DIF to replace the existing, outdated 1998 constitution. Over 80 per cent of votes were secured for that resolution.

"[The new constitution], from an administrative point of view, it makes it more workable and pliable by the responsible entity in order to manage the fund in the best interests of all unitholders, and it's just really bringing it in line with industry standards and with updates that have taken place throughout the past 10 years since the original constitution was put in place," HFAAM managing director Robert White said.

Both the wholesale and retail versions of the DIF lost 28.80 per cent and 29.09 per cent after fees in 2008, according to HFA's website.

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