Ann: May 2024 Investment Update, page-7

Five thoughts.
1. From what they've said in presentations they will definitely be trying to persuade investors not to wind it up. Wilsons 100% want to have a presence in the alternative assets space.
2. If they did have to wind it up it would presumably take a few years until all the assets were sold given the underlying assets are at various levels of liquidity. They'd probably be returning capital a bit at a time and/or returning some of it in larger dividends as they have franking credits in reserve and profits reserve to enable them to do this.
3. It would be very difficult to run the fund as an unlisted fund as the underlying assets are fairly illiquid so you can't just sell them off when people want to redeem some units. It's just not practical unless you put in rules that stop people from selling out when they want to and investors won't like that.
4. There's a good article on Livewire that analyses the discounts of LICS over time and it concludes that discounts lessen when interest rates are lower. So there's some hope that the discount of this LIC and others will reduce with likely lower interest rates in a year or two.
5. In terms of the valuation of current assets it's been a subdued couple of years in the alternative assets space and this period looks like it's coming to an end. So underlying asset values, and therefore NTA, should start increasing now and over the next couple of years.

Given point 1 I'd hope that Wilsons pull out all the stops to reduce the discount in the run up to he vote of whether to wind the fund up. For me it's a nice safe stock that gives me exposure to alternative assets that you usually need many millions of dollars of committed long term capital to get access to. In addition there is the possibility of significant capital gains given the discount to NTA and likely increase in underlying asset values.