City of London’s response a feeble attempt, says Tan

30 Nov 2014 / 12:50 H.

    PETALING JAYA: City of London Investment Management Co Ltd's reasons for opposing the re-election of Tunku Abdul Aziz Tunku Ibrahim as a director of Bhd (ICAP) are "inadequate, baseless and utterly weak", said ICAP fund manager Tan Teng Boo.
    In a letter dated Nov 24, 2014, City of London had written to Tan saying that requisite experience and understanding of close-end funds (CEFs) is more relevant than knowledge of the country or region in which the fund invests.
    "Being the first and only listed CEF in Malaysia, it is only logical that none of the directors of ICAP have requisite understanding of CEFs. Why is there a targeted attempt made by the foreign fund to single out Tunku Aziz? What are City of London's true motives?" Tan questioned in a statement released today.
    City of London also expressed concern about the length of time Tunku Aziz has been in retirement, adding that directors should not start a new term in office if they have been retired from active employment for more than five years.
    "One must question the definition of 'active employment'. What does it mean exactly? It must be brought to share owners' attention that Tunku Aziz is the current president of the Malaysian Anti-Corruption Foundation and former vice-chairman of Transparency International. If these appointments are not considered active employment, what is?"
    In the statement, Tan expressed his disappointment with the "patronising attitude" displayed by City of London.
    "Share owners are still not able to make an informed decision as the reasons given by City of London are inadequate, baseless and utterly weak," he said.
    He said the fact that the letter was not addressed to the share owners shows that the foreign fund had no intention to clarify their position to all share owners of the fund and called upon City of London to revise and substantially improve its standards of corporate governance.
    "The letter by City of London is a clear testament of the foreign fund's lack of integrity. By giving such superficial reasons for the opposition of Resolution 4, the foreign fund makes a mockery out of the other 3,400 share owners."
    In a press conference chaired by Tan last week, he explained that he had adjourned an AGM held last month to Nov 30, 2014 after learning that City of London and Laxey Partners Ltd were going to vote against Resolution 4, which is the re-election of Tunku Aziz as a director.
    Tan had called on the London-based fund management company to attend the adjourned AGM and share with all share owners its reasons for opposing the re-election.
    According to Tan, his views were supported by the Minority Shareholder Watchdog Group, whose CEO Rita Benoy Bushon said that best practices encourage shareholders, especially institutional shareholders, to explain their reasons for opposing a director's re-appointments, especially independent directors.

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