Aberdeen extends funds suspension as investors seek more time

Aberdeen has introduced the suspension on Wednesday at the same time as imposing a 17 per cent exit fee on those wanting to withdraw.

The move to extend the 24 hour suspension in trading came as two more fund managers also cut the value of their UK property retail funds as the industry battles redemption requests since the Brexit vote.

L&G adjusted its fund value by 10 per cent and F&C by five per cent. BlackRock has raised the redemption charges on its £3.3bn institutional fund.

Seven funds have so far suspended share trading.

Aberdeen said it had extended its suspension of trading in response to investor requests.

In a statement the firm said: “Following last night’s announcement Aberdeen Fund Managers Limited (“Aberdeen) has decided to extend the temporary suspension of the Aberdeen UK Property Fund and the Aberdeen UK Property Feeder Unit Trust (together “the Funds”) to noon Monday, 11 July‎ 2016. This will provide additional time for investors to consider their options in these exceptional circumstances, and further ensures that all customers are treated fairly.

“Orders for subscriptions and redemptions in the Funds placed before 12 noon on 6 July 2016 will now be processed at 12 noon on 11 July at the diluted price. Orders placed between 12 noon on 6 July 2016 and the next valuation point (12 noon on 11 July) will not be accepted.

“Shareholders wishing to redeem will do so at a price which is subject to the dilution adjustment in order to reflect the current market environment and the fact that short term trading in the property market has relatively penal consequences. Those investors who submitted redemption requests before 12 noon 6 July 2016 will have the opportunity to cancel or proceed with the trade. For the avoidance of doubt, if investors do not specifically instruct the cancellation of their redemption request, such redemptions will be processed at the diluted dealing price on 11 July 2016.

The Funds remain closed to new subscriptions and redemptions until after noon,11 July 2016.”

Martin Gilbert, chief executive of Aberdeen Asset Management, said: “Feedback regarding our approach has been positive. Investors appreciate that we are continuing to provide liquidity, albeit at a discounted price which reflects current market conditions and the fact that short term trading in the property market has relatively penal consequences. However, investors who placed trades yesterday have asked for more time to consider whether to withdraw their redemptions which we have now made arrangements to provide them with.”

The decision to extend the suspension period was taken by Aberdeen in agreement with the Depositary.