War of words over MEF restructure bid

Malaysia Equity Fund (MEF), the besieged US$206.4 million fund facing a shareholder revolt over poor performance, has been accused of trying to 'cause doubt and confusion among shareholders'.

The comments, from Peregrine Securities (UK), which claims to have the backing of more than 50 per cent of the fund's shareholders to restructure MEF, come ahead of an extraordinary general meeting in Hong Kong next week to decide whether the fund should convert from closed-end to open-ended status.

Peregrine yesterday said it believed more than 70 per cent of MEF shareholders had lodged voting instructions supporting its proposals.

It said its criticisms of the MEF board followed the issue of a circular which contained 'nothing that has not previously been discussed or addressed in relation to the Peregrine proposals'. MEF has questioned the ability of Peregrine to carry out the proposals, suggesting it could become bogged down trying to seek regulatory approval.

'After having taken extensive legal advice, Peregrine does not believe that any Malaysian regulatory consents are needed before its proposals can be implemented,' Peregrine said.

It said adequate systems and procedures were in place to conduct its restructuring proposals.