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Invesco shelves split cap launch

Invesco Perpetual has shelved plans to launch the dual return split capital investment trust owing to a lack of demand.

The launch of the trust, which would have been the first split capital fund to be launched since 2005, was originally postponed in December. This was because Invesco was unable to guarantee the delivery of a signed-off prospectus from the UK Listing Authority on time.

However with an upcoming election and in the midst of uncertain stockmarkets, Andrew Watkins, sales director of specialist funds, says the level of support for the trust did not match its minimum requirement.

He says: “Over the last six months, we have been looking into the possibility of launching a new split capital investment trust that responded to what our principal clients have been asking us for-an investment vehicle delivering separated returns of income & capital which are taxed accordingly.

“The proposed back-to-basics approach of just income and capital shares, backed by a high quality equity portfolio, struck a chord with potential investors and received a very positive response. However, as they say, timing is everything and with a general election looming and attendant uncertainty over stockmarkets, it has become clear the level of support presently available may not meet our minimum requirement for launching a new investment trust.”

According to Watkins the level of demand for the split cap was half it what it needed. However he says there is chance the group may revisit plans to launch the fund in the future.

“There is no question there is demand for the fund, but at this stage there is just not quite enough,” he says. He adds “I would like to thank our clients for their consideration and positive contributions during the development process.”

The split was going to be headed up by Martin Walker and offer a traditional split between income and capital shares. In the trust’s original proposals it was going to contain no bank debt. However in January Fund Strategy reported the group was considering adding tactical gearing to the trust, which was set to have a seven year life.


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