Horlick threatens hostile takeover of her own fund

The saga over City superwoman Nicola Horlick's Bramdean Alternatives fund took its most bizarre twist yet yesterday as she threatened to pursue a hostile takeover against her own fund.

Bramdean Alternatives – a listed fund established and run by Ms Horlick's company, Bramdean Asset Management – has been fighting for its life since losing £12m in Bernard Madoff's Ponzi scheme and seeing its share price drop by more than 35 per cent in just two days when the involvement was made public. The mystery bidder who approached the fund's independent board in late March was last week revealed to be Ms Horlick herself.

Yesterday, the board formally rejected the approach at the overwhelming request of shareholders spooked at the idea of a manager performing due diligence on their own fund. But Ms Horlick's Petersfield Asset Management vehicle refused to withdraw the approach, intimating a potential hostile bid.

Meanwhile, Bramdean Alternative shareholders are to vote this Thursday on another proposal, tabled by Vincent Tchenguiz's investment vehicle, Elsina, early last month. Elsina, which has a 29 per cent stake, has called for the board to be ousted and the fund liquidated.

The board – chaired by the former 3i chief executive Brian Larcombe – has its own suggestions. After discussions with investors holding 94 per cent of the shares, it is proposing a corporate reconstruction under which shareholders could choose whether to sell out or not. The scheme will be put to a vote at the extraordinary general meeting later this week.

A spokesman for the board said: "The board has acted today in the interests of all shareholders and will continue to do so. It will present alternative arrangements which it believes will be of the greatest benefit for all shareholders in the near future."

Alternatives shares are currently trading at a discount of about 32 per cent, with its market capitalisation of about £76m dwarfed by the fund's value of £112m.

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