RANGER Direct Lending (RDL) investors’ mailboxes continue to fill up with open letters, with LIM Advisors issuing a rallying call for shareholders to back its vision for the beleaguered investment trust.
LIM Advisors, which holds 9.2 per cent of shares in RDL, has written to the fund and shareholders stating its opposition to the appointment of Ares as manager and urging them to back its resolutions to overhaul the board.
The investor has previously joined with Oaktree Capital Management – which has an 18.6 per cent holding – in calling for the fund to be wound up and has separately put forward resolutions for RDL’s annual general meeting on 19 June to remove chairman Christopher Waldron and appoint four new non-executive directors to the board.
RDL has been going through tough times, with a legal dispute against its Princeton holding and poor performance from its marketplace lending holdings all impacting returns.
“We do not agree with this proposed change of manager as it requires Ranger Alternative Management to manage our investment for another 10 months and then, under the new manager, to dramatically alter the investment strategy of the fund,” the letter from LIM Advisors said.
“In the light of the catastrophic losses in Princeton and the badly handled strategic review, the directors should instead consider the future of the fund and ask shareholders whether to continue the fund’s operations or not.”
Oaktree has submitted a resolution calling for its own nominees – Greg Share and Dominik Dolenec – to be placed on the board and LIM Advisors has called for the appointment of Brendan Hawthorne and Eric Long.
It comes after proxy adviser Glass Lewis said discussions about the fund’s operations and structure are “best left to management and the board.”
But it has recommended that shareholders vote for one each of Oaktree’s and LIM Advisors’ nominees.
The report said Hawthorne has expertise in dispute resolution and asset recovery while Long has experience in the US loans market.
However, Glass Lewis said shareholders should oppose the other appointments due to potential conflicts as Long is the brother of LIM Advisors’ chairman and founder, while Dolenec is managing partner of a firm which has engaged RDL on behalf of Oaktree in connection with its investment.