Maverick investor Nicholas Bolton is reportedly preparing to launch a vulture fund to target companies whose shares are trading to their net tangible asset value.
According to a report in The Age, the fund will be known as the Australian Style Investment Fund, named after Bolton’s company of the same name.
The venture is reportedly being backed by SLM Corporate and would be investors will need at least $250,000 to back Bolton.
Bolton is best known for his investment in BrisConnections in early 2009. He became the largest shareholder in the company after amassing a 19.7% stake for less than $100,000 after the company’s stock plunged to just 0.1c last year, but he then claimed he was unaware that each unit holder is required to pay a $2-per-share installment to BrisConnections over the next 12 months. That meant Bolton faced a debt of $154 million on his shares.
Bolton then called an extraordinary general meeting of the company in the hope of winding up the company and getting out of paying the installments.
But before the meeting in April, Bolton sold the voting rights to his shares to Leighton Holdings, the major contractor working on the road, for $4.5 million. Leighton then voted Bolton’s shares against the wind-up resolution and Bolton offloaded his shares to a family friend under a prearranged option deal.
Bolton also made investments in MMC Contrarian and Multiplex Prime Property Fund.
In an interview earlier this month in The Australian, Bolton said he would be targeting smaller companies this year.
“I’m not really fond of the volatility risk of the index, or the sharemarket in general; I’m more about extracting value in a particular company.”
The Age says SLM Corporate’s managing director Barry Lewin has been a key advisor to Bolton.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
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