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Over the Edge

Sophisticated and complex high-risk tax-sensitive investments in small companies: handle with care
127tolmers
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Over the Edge

#247530

Postby 127tolmers » August 28th, 2019, 3:33 pm

Apparently at the Edge Performance VCT AGM today all the 3 directors up for re-election, Sir Robin Miller, Lord Flight and David Glick were voted out and the auditor Grant Thornton was not re-appointed by shareholders. Doubtless we shall hear more in due course from attendees and the one remaining director of the Company. The RNS should be interesting.

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Re: Over the Edge

#247540

Postby BusyBumbleBee » August 28th, 2019, 4:20 pm

Well spotted, Tolmers - have a rec!

Was that the 'FLight' of the Guinness Flight VCT - the one that became ORTUS? One of my worst ever investments :(

This may smarten up a few boards who have been taking investors/shareholders for granted

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Re: Over the Edge

#247544

Postby barchid » August 28th, 2019, 4:33 pm

Indeed, Howard Flight as he was in Ortus days, I was caught in that one too.....
Didn't it end up in Maven 4 ?
It could indeed put some steel into boards, heaven knows they are badly in need of it in many cases !

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Re: Over the Edge

#247829

Postby BusyBumbleBee » August 29th, 2019, 2:37 pm

The thirteenth Annual General Meeting of Edge Performance VCT plc (the "Company")
was held at 10am on Wednesday, 28 August 2019

Not lucky 13 for the board!

These are the proxy votes see : https://uk.advfn.com/stock-market/londo ... M/80627142

Proxy votes cast were as follows:

Code: Select all

      Resolution                                       For       Against   Withheld
 2.   Approve directors' remuneration report     1,770,628     3,106,545     47,968
     ---------------------------------------  ------------  ------------  ---------
 3.   Re-elect Sir Robin Miller                  1,725,784     3,140,268     59,089
     ---------------------------------------  ------------  ------------  ---------
 4.   Re-elect Lord Flight                       1,659,996     3,206,056     59,089
     ---------------------------------------  ------------  ------------  ---------
 5.   Re-elect David Glick                       1,715,071     3,183,421     26,649
     ---------------------------------------  ------------  ------------  ---------
      Re-appoint Grant Thornton UK LLP as
 6.    auditor                                   2,147,140     2,751,352     26,649
     ---------------------------------------  ------------  ------------  ---------
 8.   Authorise directors to allot shares        1,960,585     2,938,060     26,496
     ---------------------------------------  ------------  ------------  ---------
      Authorise directors to allot shares
 9.    with disregard to pre-emption rights      1,737,431     3,118,075     69,635
     ---------------------------------------  ------------  ------------  ---------

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Re: Over the Edge

#251619

Postby sinterklaas » September 13th, 2019, 1:28 pm

I see that two of the directors NOT re-elected at the AGM have subsequently been re-appointed.

Explanation / attempted justification…

https://www.investegate.co.uk/edge-perf ... 58173074M/

Another dark day for VCT investor relations?

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Re: Over the Edge

#251628

Postby 127tolmers » September 13th, 2019, 2:19 pm

Not a totally dark day! The Manager, David Glick, has not been reappointed which should help with the strategy discussions on cost reductions. Also a new director will soon be appointed.

In recognition of the criticism implicit in the decisions of the annual general meeting not to re-elect Sir Robin Miller and Lord Howard Flight, an additional director (the "New Director") will be appointed to the Board as soon as possible. The appointee will be demonstrably independent of the other Board members and the Manager and will have a good knowledge of the VCT sector - thereby bringing a fresh and knowledgeable eye to the consideration of the Company's future. Soundings have already been taken and continue to be taken with the Company's advisers and a sample of the Company's shareholders who voted at either this year's or the previous year's annual general meetings and it is intended that the New Director will be appointed in October 2019.

There was a separate announcement.

https://www.investegate.co.uk/edge-perf ... 56333067M/

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Re: Over the Edge

#251686

Postby BusyBumbleBee » September 13th, 2019, 7:05 pm

sinterklaas wrote:I see that two of the directors NOT re-elected at the AGM have subsequently been re-appointed. ...
Explanation / attempted justification…
https://www.investegate.co.uk/edge-perf ... 58173074M/
Another dark day for VCT investor relations?

No - it is a very, very dark day and marks a new low in VCT governance.

Weasel words in the RNS ""In recognition of the criticism implicit in the decisions of the annual general meeting. Sorry mate; it couldn't have been any more explicit.

Thank-you, sinterklaas, for raising this. ! despair. What a precedent to set. So presumably if any director is voted off any VCT board from here on, (s)he will be immediately reappointed.

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Re: Over the Edge

#251785

Postby Gostevie » September 14th, 2019, 11:49 am

My own thoughts on these shenanigans can be found here:

shareprophets.com/views/44773/edge-performance-vct-could-you-make-this-up

Gostevie

removed hyper link - paid sites are not permitted without paid sponsorship and are covered in the rules;
"Posting of links to 3rd party sites is acceptable where it is entirely relevant to the discussion. However, any links promoting a 3rd party site are not allowed"
Stooz

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Re: Over the Edge

#251813

Postby UncleEbenezer » September 14th, 2019, 2:23 pm

Gostevie wrote:My own thoughts on these shenanigans can be found here:
Gostevie

Not without paying good money. If you want to share your thoughts, please do so here (or at least somewhere else that's free to view).

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Re: Over the Edge

#252146

Postby sinterklaas » September 16th, 2019, 10:13 am

There's a commentator called Roger Lawson who posted the following on his blog; I think it sums it up quite well.

At the Edge Performance VCT (EDGH and EDGI) the sole remaining director Terry Back has reappointed two of the directors removed by votes at the recent AGM. This I consider most atrocious behaviour. The last time I saw this happen was at the bun fight over the future of Victoria (VCP) and that was soon overturned and a new board put in place.

It is of course essential to have more than one director in a public company because of the listing rules and for other reasons. It can of course be difficult to recruit new directors at short notice, particularly when a company is in difficulties. Potential directors fear they are at reputational risk. But reappointing directors removed by a vote of shareholders is simply not acceptable. Shareholders have a strong interest in improving matters so it should not be impossible to find some volunteers. I have suggested that ShareSoc line up some nominees to put the board on the spot. Investors need some new independent directors, not the same old guard.

As I said in this previous blog post: https://roliscon.blog/2019/09/02/edge-p ... ct-sorted/, I have long considered this VCT to be a basket case of the first order. The situation should not be allowed to continue.

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Re: Over the Edge

#252981

Postby Gostevie » September 20th, 2019, 9:34 pm

Now that a week or so has elapsed, here is the text of the article that I had published on ShareProphets (which made a few minor alterations to it):
__________________________________________

Edge Performance VCT (EDGH) – Could you make this up?

Since they were launched by the John Major government in 1995, Venture Capital Trusts (VCTs), which are closed end investment trusts that provide finance for small and growing unquoted UK companies, and which are listed on the main market, have given investors a bumpy ride. The tax breaks remain generous, albeit not as generous as they were initially, and some of the now-established generalist ones have provided and continue to provide investors with a steady income from tax-free dividends with relatively low risk, whilst most of the worst ones have fallen by the wayside, taking a large chunk of investors’ money with them. I remain, broadly, a fan but there are still some appalling examples around.

One of the survivors is the Edge Performance VCT (EDGH) which has, to put it mildly, not been a great performer, with a complicated share structure and whose shareholders will have lost a large amount of their money. Three recent RNS announcements demonstrate a ‘coach and horses’ approach to corporate governance that would make even the most questionable AIM listed companies look like pillars of virtue. An AGM statement on 29th August revealed that shareholders had overwhelmingly voted to remove the three directors who were up for re-election - Sir Robin Miller, Lord Flight and David Glick.

https://www.investegate.co.uk/edge-perf ... 09566009K/

Oh, dear. But never mind. The remaining director, Terry Back, would no doubt appoint new replacement directors, and indeed an RNS released on 13th September revealed that he had indeed done so. But wait…

https://www.investegate.co.uk/edge-perf ... 56333067M/

“In accordance with the Articles of the Company, the Company's sole director, Terry Back, has appointed Sir Robin Miller and the Board, comprising Terry Back and Sir Robin Miller, subsequently appointed Lord Howard Flight as directors of the Company. Both appointments took effect from 12 September 2019.”

Erm… So two of the three directors who were overwhelmingly voted out by the company’s owners just a couple of weeks earlier have been reappointed by the one director who wasn’t up for re-election. Crikey, that will need a bit of explaining, so we get a Corporate Update RNS on the same day:

https://www.investegate.co.uk/edge-perf ... 58173074M/

“Given that both Sir Robin Miller and Lord Howard Flight had been directors of the Company who were not re-elected at the 2019 annual general meeting, the Board decided that it would be appropriate to explain its respective decision to make these appointments with the aim of answering any criticism that the results of the annual general meeting were being ignored.”

I should say so!

“The primary reason for the appointments of both Sir Robin Miller and Lord Howard Flight is to give them, together with Terry Back, the opportunity to conclude the work which they have started and to preserve continuity in the liaison with the Manager and several of the Company's investee companies.”

What? It goes on:

“Also, in recognition of the sentiment expressed at the 2019 annual general meeting, a general meeting will be held before the end of the Company's current financial year (29 February 2020) - that is at least seven months before the 2020 annual general meeting need be held. Prior to the proposed general meeting, a statement will be released setting out the Board's decisions concerning the Company's future and shareholders will have the opportunity to vote at that general meeting on whether the newly appointed directors continue in office.”

That should be an interesting meeting, to say the least. I am tempted to buy a few shares just for the entertainment.

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Re: Over the Edge

#253055

Postby Kidman » September 21st, 2019, 3:04 pm

I note the following from the Corporate update:-
On average, 3.75% of the total voting rights voted against the resolutions while, on average, 2.01% of the total voting rights supported the resolutions.

I also note that one shareholder holds 3% of the shares, Shivani Palakpari Shree Parikh, since 6 June 2019. With so few shares voted her/his holding alone should be enough to decide these resolutions.
https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/EDGH/14103067.html

The same person also has a notifiable interest in all four of the Oxford Technology VCTs.

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Re: Over the Edge

#253296

Postby 127tolmers » September 23rd, 2019, 1:53 pm

https://www.investegate.co.uk/edge-perf ... 25152774N/

The Company is pleased to announce that it has realised its investments in deltaDNA Limited (formerly Gamesanalytics Limited) generating total proceeds of approximately £4.9m (which is a c.5x money on money return). This is an increase of £3.2m on the valuation reported in the Company's financial statements for the year ended 28 February 2019.

deltaDNA was held as part of the H share class investment portfolio, increasing the Net Asset Value ("NAV") of this class of share from £6.1m to £9.3m, and the Company NAV from £34.3m to £37.5m, prior to any other revaluation of assets for the half yearly report to the end of August 2019.

The transaction completed on the 18th September 2019, and the consideration from the transaction was part cash and part equity in the purchaser.


No details on acquirer, whether quoted or how much cash.

127tolmers
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Re: Over the Edge

#253299

Postby 127tolmers » September 23rd, 2019, 1:57 pm

https://www.businessleader.co.uk/unity- ... dna/73546/

https://www.businesscloud.co.uk/news/si ... -tech-firm

Edinburgh game tech firm deltaDNA has been acquired by Silicon Valley giant Unity Technologies.

deltaDNA enables games studios to build intelligent long-term relationships with players using personalised engagement.

It has now been acquired by the parent company of Unity, the world’s leading real-time 3D development platform which forms the bedrock of many of the video game sector’s top titles.

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Re: Over the Edge

#258437

Postby shootingstar » October 17th, 2019, 11:30 am

Just picked up that this slipped out on 10 October, what a complete shambles

The Company announces that one of its investee companies, Coolabi Group Limited ("Coolabi"), has finalised with
its management team a revised management incentive scheme, which will become effective only upon the sale of
Coolabi. While disappointed by the negative impact this has on the valuation of the Company's holding in
Coolabi, the Company's board of directors notes that the implementation of a revised management scheme was a
condition of further investment from an existing investor in Coolabi.
As a result of this agreement, the Company's net asset value has decreased from £37,569k (the revised NAV
following the sale of its holding in deltaDNA Limited, as per RNS Number 2774N of 23 September 2019) to
£34,056k, a reduction of 9.4%, where both NAVs are stated prior to any other revaluation of assets as at 31 August
2019 for the Company's half-yearly report.
Coolabi was held in both the H and I share classes of the Company. The effect of the revised Coolabi
management incentive scheme is to decrease the H share class NAV from £9,299k to £9,126k, a reduction of 1.9%,
and the I share class NAV from £28,269k to £24,930k, a reduction of 11.8%. In the case of the H share class, the
NAV reduction is based upon the revised NAV following the sale of its holding in deltaDNA Limited, as per RNS
Number 2774N of 23 September 2019, and in both cases these NAVs are prior to any other revaluation of assets as
at 31 August 2019 for the Company's half-yearly report.

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Re: Over the Edge

#261986

Postby 127tolmers » November 4th, 2019, 10:51 am

October has ended and the sacked and then reappointed board has not met its commitment to appoint an independent director.

https://www.investegate.co.uk/edge-perf ... 58173074M/

At the Company's thirteenth annual general meeting held on Wednesday 28 August 2019, the resolutions to re-elect three of the Company's directors were defeated. On average, 3.75% of the total voting rights voted against the resolutions while, on average, 2.01% of the total voting rights supported the resolutions.

These results left the Company with only one director, Terry Back, who, under the provisions in the Company's articles of association (the "Articles") relating to the authority of a sole director, was allowed only to appoint at least one other director (thereby re-establishing the minimum number of two directors required to form a quorum for meetings of the Board) or to summon a general meeting.

In accordance with the Articles, Terry Back, appointed Sir Robin Miller and the Board, comprising Terry Back and Sir Robin Miller, subsequently appointed Lord Howard Flight. Both Sir Robin Miller's and Lord Howard Flight's appointments took effect from 12 September 2019.

Given that both Sir Robin Miller and Lord Howard Flight had been directors of the Company who were not re-elected at the 2019 annual general meeting, the Board decided that it would be appropriate to explain its respective decision to make these appointments with the aim of answering any criticism that the results of the annual general meeting were being ignored.

In November 2018, the Company's three independent directors - Terry Back, Robin Miller and Howard Flight - began formal consideration of a strategy and revised cost profile for the Company, to take effect from no later than 1 March 2020. It had been intended that any progress made would be reported in the Company's 2019 Annual Report or, failing which, prior to the Company's 2019 annual general meeting. In the event, significant developments in several of the Company's investee companies demanded a level of involvement from both the Board and Edge Investments Limited ("the "Manager"), the Company's investment manager, which interrupted the planned timetable for the strategy and revised cost proposals, despite a decision to hold the annual general meeting later in 2019 than was originally intended.

The primary reason for the appointments of both Sir Robin Miller and Lord Howard Flight is to give them, together with Terry Back, the opportunity to conclude the work which they have started and to preserve continuity in the liaison with the Manager and several of the Company's investee companies.

In recognition of the criticism implicit in the decisions of the annual general meeting not to re-elect Sir Robin Miller and Lord Howard Flight, an additional director (the "New Director") will be appointed to the Board as soon as possible. The appointee will be demonstrably independent of the other Board members and the Manager and will have a good knowledge of the VCT sector - thereby bringing a fresh and knowledgeable eye to the consideration of the Company's future. Soundings have already been taken and continue to be taken with the Company's advisers and a sample of the Company's shareholders who voted at either this year's or the previous year's annual general meetings and it is intended that the New Director will be appointed in October 2019.

It had been Terry Back's intention that the appointment of Sir Robin Miller, and the first meeting of the Board, would have been held in October 2019, at which meeting Lord Flight and the New Director would have been appointed as additional directors - announcing the appointment of the New Director would have been more reassuring to concerned shareholders than announcing an intent to make that appointment as soon as possible. However, the imminent resolution of one investee company issue requires that there be a quorate Board now, ahead of the intended appointment of the New Director in October 2019.

Also, in recognition of the sentiment expressed at the 2019 annual general meeting, a general meeting will be held before the end of the Company's current financial year (29 February 2020) - that is at least seven months before the 2020 annual general meeting need be held. Prior to the proposed general meeting, a statement will be released setting out the Board's decisions concerning the Company's future and shareholders will have the opportunity to vote at that general meeting on whether the newly appointed directors continue in office.

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Re: Over the Edge

#263169

Postby 127tolmers » November 9th, 2019, 10:22 am

10 days past the end of October and another broken promise.

In recognition of the criticism implicit in the decisions of the annual general meeting not to re-elect Sir Robin Miller and Lord Howard Flight, an additional director (the "New Director") will be appointed to the Board as soon as possible. The appointee will be demonstrably independent of the other Board members and the Manager and will have a good knowledge of the VCT sector - thereby bringing a fresh and knowledgeable eye to the consideration of the Company's future. Soundings have already been taken and continue to be taken with the Company's advisers and a sample of the Company's shareholders who voted at either this year's or the previous year's annual general meetings and it is intended that the New Director will be appointed in October 2019.

At the ShareSoc event at the the FRC last week, the FRC governance team expressed great interest in the directors shenanigans that had happened at Edge including the fact that Lord Howard Flight was deemed by the board to be a director for a year after his term of office had legally expired at the 2018 AGM at which he did not stand for re-election.

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Re: Over the Edge

#263740

Postby 127tolmers » November 12th, 2019, 2:43 pm

Just 2 weeks overdue we get an announcement. The new auditor UHY Hacker Young does the 2 New Century Aims, Seneca/Hygea and the 4 Oxford Technology VCTs at competitive rates. Lord Flight departs again in Feb and Sir Aubrey Brocklebank joins his fellow director on Downing Four, Lord Flight, so not exactly independent.

https://www.investegate.co.uk/edge-perf ... 44240995T/

Further to the Corporate Update released to the market on 13 September 2019, the Company's board of directors ("Board") is pleased to announce the appointments of a new director and auditor.

The Company is pleased to announce that Sir Aubrey Brocklebank has been appointed to the Board as a non-executive director with effect from 11 November 2019.

Following a career in accountancy, corporate finance and venture capital, Aubrey assumed his first role within the VCT industry in 1997. Since then he has gone on to become one of the most experienced directors. Aubrey maintains a wide range of business interests and has been a director of six AIM listed companies. He is chairman of Downing Four VCT plc and Hargreave Hale AIM VCT plc.

The Board is pleased to announce the appointment of UHY Hacker Young as its new auditor.

The Board also announces that Lord Flight has informed the Board of his decision not to stand for election at the Company's general meeting to be held in February 2020.

Lord Flight had accepted an invitation earlier this year to re-join the Board to help complete the work of the Board to reduce the Company's running costs and introduce a strategy for the Company's future. With the progress that is being made on both of these fronts, Lord Flight has decided that the February 2020 general meeting is the right time to stand down, particularly with the appointment of Sir Aubrey.

The Board wishes to express its gratitude for Lord Flight's significant contribution over several testing years for the Company and wishes him and wishes him all the best.


Several testing years for shareholders methinks!

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Re: Over the Edge

#274772

Postby 127tolmers » January 3rd, 2020, 9:47 am

Reposting Cliff Weight's blog from another LF Edge thread.


Re: EDGE performance incentives
Quote #274754

Post by CliffW8 » January 3rd, 2020, 8:40 am

ShareSoc have now launched a campaign, see https://www.sharesoc.org/campaigns/edge-vct-campaign/

ShareSoc has launched a campaign to improve the performance of Edge Performance VCT Plc (consisting of H and I share classes) and reduce the fees charged by its investment manager, Edge Investments Limited. We are seeking shareholders to:

- collectively work together to persuade the incumbent directors to make various changes,
- vote to appoint new directors,
- vote against various resolutions at the upcoming General Meeting in February 2020.[/list][/list]
In addition, we seek to persuade Edge Performance VCT to agree a better deal with its investment manager or find a suitable replacement. We are very concerned about the board’s response to shareholders’ concerns so far.

Campaign Objectives

Our objectives are as follows:

1.Change some members of the Board, to create a Board clearly focussed on :
- accelerating the process of looking for exit of the (essentially a single) investment for the I share class, given the limited life nature of that VCT
ensuring that the I class shareholders are not incurring excessive costs (currently in excess of £1m a year to manage what is essentially a single investment) until this investment is exited
-reducing the operating costs of Edge Performance VCT to enable the H share class to be viable by itself, once the remaining investment of I class is realised and the sale proceeds are paid to the I class shareholders; and
-determining the best long term strategy for the VCT.
2. Highlight the concerns of many shareholders about the current situation.
3. Persuade the Directors of Edge Performance VCT to engage with its shareholders and discuss what more appropriate manager agreements, other costs and strategy might be.
4. Deter other VCT boards from approving egregious management fee arrangements.

Information about the Campaign

The general problems of VCTs are summarised here: The VCT Investors Group Campaign
The Edge Performance VCT issues are explained below:
Edge Performance VCT has performed badly:

Funds in the limited life share class(es) (the majority of the money raised) were due to have been returned to shareholders between 2 and 7 years ago; shareholders who need to liquidate these holdings are faced with a very unpalatable bid price of about 11.5p. per I share.
The costs of what should be a very simple VCT to run are amongst the highest in the industry.
I and H shares rank 61 and 62 out of 62, over the past five years in TSR (total shareholder returns) terms, according to AIC stats [see note 1].

Shareholders have registered their dissatisfaction by voting against the Board and their proposals.

At the 2019 AGM, all 3 directors who stood for re-election were not re-elected; nor were the auditors Grant Thornton; the remuneration report was not approved, nor was approval given to allot shares.
At the I share class meeting on 5 July 2018 (called to seek to reward the manager even further on top of the generous fees it was already earning), the Special Resolution on a new performance fee arrangement was also not approved, despite the Board using shareholder money to engage proxy consultants to solicit votes in favour.

Corporate governance is poor:

Subsequent to the 2019 AGM, the Company's sole remaining director, Terry Back, appointed Sir Robin Miller; and the Board, comprising Terry Back and Sir Robin Miller, subsequently appointed Lord Howard Flight as director of the Company. This was despite them both having been removed by shareholders at the AGM. Their failure to challenge and reduce the fees paid to the investment manager (and even agreeing to an increase in the expenses cap in 2016) and the limited progress on selling the stake in Coolabi were very good reasons neither should have stayed in office.
The delay in the Edge Performance VCT Board learning of, and reacting to, the significant dilution that resulted from the recent funding round by Coolabi is of significant concern, and indicates communication between the Board and the manager is poor.

Far too much of Board’s focus seems to be based on offering alternative performance fees to the manager for the I Class, rather than on cost reductions:
The Board announced in August 2016 that I class performance fees were removed in 2016. The 2017 annual report noted this: “In August 2016, the performance fee in respect of the I Share Fund was removed. The Board announced that it will, in due course, undertake a wider review of the Company’s future performance and consider implementing an alternative incentive, if appropriate, which will be subject to shareholder approval. The Investment Manager has been fully supportive of this process.” “His [Robin Miller’s] entitlement to a performance fee in respect of the I Share Fund fell away in August 2016, with the Board’s decision to remove the Investment Manager’s performance fee in respect of the I Share Fund.” However, since then, there has been no progress on reducing the annual management fee of 1.75% NAV for the I Class nor the administration services fee, the latter last year was £309,000.

The Annual Report for 2018 and the May 2018 Circular said that the performance fee for the I Class was still in place, even though it had been removed in 2016. The circular said shareholders had the choice of approving the proposed performance fee or keep the previous. We understand the previous performance fee was removed in 2016, so the circular was incorrect. (Alternatively, the August 2016 RNS was incorrect.)

The 27 September 2018 announcement of the Variation to Investment Management Agreement announced further actions of the Board which we believe are not in the shareholders’ best interests – “The removal of the I Share Performance Incentive Fee is conditional upon the Company and the Manager acting in good faith and using all reasonable endeavours to agree alternative performance incentive arrangements in relation to the I Shares”. The change from “consider implementing an alternative incentive, if appropriate” to “using all reasonable endeavours” is significant and not in shareholders’ best interests. In particular, the Board has (again) failed to agree or note the need to reduce the management fee and the administration services fee.

The longer the current manager agreements continue, the more the manager gets paid. Introducing a performance fee, on top of the current management fee and administration services fee, is the wrong approach.

The Board engaged proxy consultants, at shareholder expense, to solicit votes in favour of the flawed proposal at the July 2018 I Class meeting. This money was wasted, as shareholders nevertheless voted against the proposal.

Lord Flight did not stand for re-election in 2018 when his reappointment was due. The Board are unwilling to advise shareholders of this oversight.
A number of shareholders have been communicating with the Board, but so far, have not managed to elicit any significant change. The Board has promised to present their strategy, and proposals to revise the cost structure, before a general meeting in February 2020 where they can be voted on. We are concerned at the time this is taking, and that, on past form, the Board will not be aggressive enough with reducing the cost base.

There will be very limited opportunity to contact shareholders after the Board publish their own plan, and hence we are contacting some key shareholders now.

This campaign is being run by the ShareSoc Edge Shareholder Action Group, whose founder members are, Andrew Kenny, Cliff Weight, Mark Lauber, Richard Roth, Robin Goodfellow and Shivani Parikh.

Our proposals

Progress with exiting the major investment (Coolabi) at a fair price should be the major priority for the Board.

A reduction in the operating expenses would help avoid yet further losses to shareholders in the meantime, and will be essential to ensure the viability of the VCT once any proceeds from Coolabi are distributed to shareholders. Indeed, we think that a reduction from the current £1.5 million to an absolute maximum of £400,000 should be achievable for the whole company, whilst the I shares still have value, and even less thereafter.

We think 3 directors on a VCT of this size is sufficient. Richard Roth and Robin Goodfellow are willing to stand for election. Lord Flight is standing down and we think Sir Robin Miller should be removed as he has taken too long to address the issues which are highlighted above. We would be willing for Terry Back to continue with Richard Roth and Robin Goodfellow as fellow directors. This would mean there is no need and no space for Sir Aubrey Brocklebank, who was appointed as a fourth director on 11 Nov 2019.

We think the Board needs a balance of skills and experience, which collectively reflects what each director and candidate brings to the table.

Richard is a good allrounder, has extensive VCT director experience elsewhere and has specific skills in the cost reduction side which would complement Terry Back’s skills in media. He is currently Chairman at Oxford Technology 2 VCT Plc, and a director of 4 other VCTs. Richard is a Chartered Management Accountant and is audit committee chairman of all 5 companies. He previously held senior positions in the airline industry and is a graduate from Bath University. Richard has participated in the recent successful Ventus VCTs’ campaign.

Robin is also an experienced Chairman and Non-Executive Director of other VCTs and will bring wise counsel and fresh eyes to this Board. Currently, Robin Goodfellow is the Chairman at Oxford Technology 3 VCT Plc and a director of three other VCTs. In his past career Robin was Audit Manager at ExxonMobil . He graduated from Cambridge University and holds an MBA from London Business School. Robin has participated in several VCT shareholders campaigns and was for many years a regular commentator on and activist in the VCT industry.

If the Edge Performance VCT Board can demonstrate sufficient progress in addressing the above issues with its announcement in the next few weeks, then we will be prepared to withdraw our resolutions, but only if we are comfortable that their proposals will achieve the required objectives.

We fear however that, despite months of the Board talking with the Investment Manager and reviewing arrangements with all other suppliers, there is neither an “oven-ready” proposal for the necessary reduction in the costs nor hope of an imminent sale of Coolabi. If this turns out to be the case, we think that a better Board would be Terry Back, Richard Roth and Robin Goodfellow and we intend to requisition resolutions to seek to make this happen.

We strongly appeal to all investors to join this campaign. It would help if you could make a donation (e.g. £500, £100, £50 or whatever you can afford) to help fund our costs, but this is not a requirement to join. If you are not a shareholder in Edge Performance VCT, your support in this campaign is still important as it will help us to push for change. We have launched a campaign page where you can join the campaign and make a donation, if you wish.

Further information and prior blogs can be found in the links below:

https://www.sharesoc.org/blog/vcts/edge ... blem-case/

https://www.sharesoc.org/blog/vcts/edge ... -on-earth/

https://www.sharesoc.org/blog/vcts/edge ... pair-rnss/

https://www.sharesoc.org/agm-reports/ed ... mance-vct/

https://www.sharesoc.org/blog/company-n ... rformance/


[1] Below is a link to the AIC database for VCTs.

https://www.theaic.co.uk/financial-advi ... w=1&page=2

Clicking on Venture Capital Trusts in the Investment sector tag and then sorting shows that in performance terms Edge I and Edge H are the 2 worst VCT performers out of all 62 VCTs over 5 years with I being down 74% and H down 46%. On an ongoing AIC charge basis Edge I and Edge H are bottom decile with annual charges of 3.66% and 4.26% respectively.

Cliff Weight, Director, ShareSoc and member, ShareSoc Edge Shareholder Action Group and shareholder in Edge Performance VCT.

127tolmers
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Re: Over the Edge

#304528

Postby 127tolmers » April 30th, 2020, 2:43 pm

So here we have an unaudited announcement of a NAV at 31 March before an audited NAV has been agreed for 29 Feb. Unlike other VCTs that have done this there is no pressing matter of allotments.

Another big drop in the I class, with just a single effective investment Coolabi (also found in Chrysalis VCT). The I shares are now down by half from Feb 2018.

There was also the case of the dog that didn't' bark in the night. What has happened to the Feb General Meeting announced in the half year report issued on 29 Nov 2019? The Chairman Terry Back said "the most significant event as we look ahead is the Feb 2020 GM. At that meeting you will be given the opportunity to decide on the Boards' recommendations for the future of the company" Now you can't blame Covid-19 for not having a Feb GM and if the GM was so significant why haven't they told shareholders what has happened to it

https://www.londonstockexchange.com/exc ... 10765.html

The Board of Edge Performance VCT plc (the "Company") together with the manager, Edge Investments Ltd, have been monitoring closely the impact on its portfolio of both COVID-19 and the various public sector financing initiatives made available by the Government in response to the pandemic.

The Board carried out a review of the portfolio and announces that the unaudited net asset value ("NAV") of the two classes of the Company's shares as at 31 March 2020 were as follows:

· H Share class NAV: £7,685,368 (ie 66.30p per share, a reduction of 17.04% since the last published valuations as at 31 August 2019)

· I Share class NAV: £20,005,707 (ie 27.37p per share, a reduction of 12.01% since the last published valuations as at 31 August 2019)

The Board emphasises that the above NAVs are unaudited. The audit of the Company for the financial year ended 29 February 2020 is currently underway.


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