Foreign & Colonial trust bows to demand for shares

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FOREIGN & Colonial PEP Investment Trust (Pepit), a pounds 32m fund launched only last October, is seeking authority from its shareholders to allow it to issue up to a further 67 million shares, writes Paul Durman.

The move is prompted by the substantial demand for the trust's shares. Pepit's directors have already issued 2.9 million shares, exhausting the standard authority to issue up to 10 per cent of existing capital.

The Pepit directors, who are independent of Foreign & Colonial Management, which manages the trust, will only issue further shares at a premium to net asset value, thereby protecting the rights of existing shareholders.

Jeremy Tigue, an F&C director, said the premium was likely to be about 3 per cent.

Pepit already has authorised capital of 100 million shares, two-thirds of which is unissued. The extraordinary meeting to approve the move is three weeks tomorrow.

Pepit's first results show net asset value of 107p per share at the end of March, 9.7 per cent up on launch. In the same period the FT-SE 100 rose 8.9 per cent and the All-Share index rose by 12.6 per cent.

The interim dividend is 0.9p.

Graham Ross Russell, chairman of Emap and the Securities Institute, takes over as chairman of Pepit from Lord Rockley, who is to concentrate on the chairmanship of Kleinwort Benson.