Ashoka WhiteOak Emerging Markets Trust PLC (LSE:AWEM) is planning to raise £100mln and be the first investment fund to list in London for over 18 months.
Due to the dearth of recent interest in initial public offers, it is only competing for investors' cash with the AT85 Global Mid-Market Infrastructure Income, which last month extended its deadline to the end of May.
With an aim of providing long-term capital growth for investment, the closed-ended investment company will be managed by Acorn Asset Management, an arm of Singapore-based investment management boutique White Oak Capital Partners, which also runs the Ashoka India Equity Investment Trust PLC (LSE:AIE) and has roughly US$5.5bn in assets under management.
Having built a decent track record since the launch of the India trust in 2018, with a three-year total return of 89.5% and a 47.1% net outperformance of its benchmark since float, the team are coming back to market.
The emerging markets fund will invest via the manager's 'bottom up' stock selection approach that targets “well-managed, scalable businesses with superior returns on incremental capital at attractive valuations”.
Leading the management team is White Oak founder and chief investment officer Prashant Khemka, former CIO and lead portfolio manager of India equity and global emerging markets equity at Goldman Sachs (NYSE:GS) Asset Management.
Martin Shenfield, current managing director of strategy at TS Lombard as well as acting as a general adviser to various family offices and funds, is non-executive chairman.
Valuations of emerging market equities are at “multi-year lows relative to developed markets,” Shenfield said in a statement, where “they offer an attractive entry point, while simultaneously exhibiting generally lower inflation, lower debt levels and higher growth potential”.
As for fees, the investment adviser is entitled to no annual management fee but only to an 'alpha fee' paid entirely in ordinary shares and based on outperformance versus the MSCI Emerging Markets Net Total Return Index (GBP) over discrete three-year periods.
Shenfield said the fee structure "[aliged] closely the interests of investment adviser with those of the shareholders".
There will also be a discount control mechanism, allowing shareholders an annual opportunity to redeem part or all of their shareholding on the basis of NAV on an annual basis, which he said "should also contribute to protecting shareholder value".