Platinum Asia Investments Limited (PAI) held a pivotal Scheme Meeting seeking shareholder approval to restructure by exchanging shares for units in the Platinum Asia Fund Complex ETF (PAXX), accompanied by a special dividend payment. The outcome will reshape PAI’s investment management and ownership structure.
- Scheme resolution requires 75% vote approval and 50% shareholder participation
- PAI shares to be exchanged for PAXX ETF units upon approval
- Investment portfolio transferred to Platinum Asia Fund (PAF)
- Termination of existing management agreements without fees
- Special Dividend payable based on retained earnings at Valuation Date
Context of the Scheme Meeting
On 12 August 2025, Platinum Asia Investments Limited (PAI) convened a Scheme Meeting to seek shareholder approval for a significant corporate restructure. The proposal centers on a scheme of arrangement that, if approved, will see PAI shares exchanged for units in the Platinum Asia Fund Complex ETF (PAXX). This move aims to streamline PAI’s structure and align its investment portfolio management under the broader Platinum Asia Fund (PAF).
Details of the Proposed Restructure
The restructure involves PAI becoming wholly owned by PAXX, with the company’s investment portfolio transferred to and managed as part of the PAF. This consolidation is designed to provide shareholders with exposure to the same Asian equity investment strategy but through a more liquid and flexible ETF structure. Importantly, the existing investment management and administrative agreements between PAI and Platinum Investment Management Limited will terminate without any termination fees, potentially reducing ongoing costs.
Voting and Approval Process
The Scheme resolution requires a dual threshold for approval – at least 75% of votes cast and 50% of shareholders voting must support the proposal. The meeting was chaired by Margaret Towers, with strong backing from independent directors including Ian Hunter. Proxy votes overwhelmingly favored the Scheme, with over 96% in support, signaling robust shareholder alignment ahead of the Federal Court hearing scheduled for 15 August 2025.
Financial Implications for Shareholders
Shareholders stand to receive a Special Dividend calculated based on PAI’s retained earnings at the Valuation Date, adjusted for restructure-related costs. For example, a worked illustration as of 31 July 2025 indicated a Special Dividend of approximately 19.9 cents per share, with a significant portion franked. Following the restructure, shareholders will hold units in PAXX, which can be traded on market at prices close to the ETF’s net asset value, offering enhanced liquidity compared to traditional shares.
Next Steps and Market Impact
Assuming shareholder and court approval, the restructure is expected to be implemented by late August 2025. This transition marks a strategic evolution for PAI, potentially improving shareholder value through cost efficiencies and greater market accessibility. However, investors will be watching closely how the market prices PAXX units post-implementation and how the new structure performs relative to the legacy PAI shares.
Bottom Line?
The approval and implementation of this restructure could redefine shareholder engagement with Platinum’s Asian equity strategy, setting a new course for PAI’s future.
Questions in the middle?
- Will the Federal Court approve the Scheme without conditions or delays?
- How will the market price PAXX units compared to PAI shares post-restructure?
- What are the long-term cost and performance implications for shareholders under the new structure?