Macquarie International Infrastructure Fund – See You Again?
MIIF has been a rollercoaster ride for me, as I’ve seen it’s ups and downs ever since I bought it in 2008. From what seemed to be a crappy return on investment turned out to be roughly a 7% annualized return over the last 6 years! As to why I bought it back then? Well, it seemed like a pretty interesting security to hold – assets which are primarily infrastructure focused, and having a big name like Macquarie fronting it made me click on the “Buy” button. However, later on, I realized that it was a pretty bad investment.
The reason why initially I thought it was a pretty bad investment was because the fund price kept dropping even though the dividend yield was pretty good, and I had to even “top-up” the initial investment along the way with some extra cash (and lint) I scrounged up from my pockets to average down, and ended up with a decent sum sunk into the fund. This all came to an end when MIIF decided to float an asset as a listed security, named Asian Pay TV (APTV) Trust, and the fund price went up as per the market’s reaction.
Back then, shareholders of MIIF could choose to either take cash or take the shares. From there, things got a bit cloudy as I have not gone through enough corporate actions to decide if I should take cash or shares, so I took shares, and sold it off a few weeks later for less than what I could have taken, or even held the shares for the long term.
However, subsequently, as the MIIF management set out to discharge their duty of “unlocking asset value” as the (other) shareholders were rather unhappy with this fund (from what I’ve gathered in the newspapers, and online back then), they sold off most of their assets bar the last one, which was finally sold this year, and thus, the business of managing the fund is over.
Closing the business isn’t the end, though – depending on if the company is solvent or not, you might even get some cash back in the form of share redemptions after the creditors and bondholders have their pick, which was what happened with MIIF. The redemption price was determined to be at $0.082714, which was pretty close to what the fund price was traded at before it was suspended for liquidation, and combining the dividends, capital returns and APTV shares sold, netted me a very nice 7%. Kudos to the MIIF management for making this possible, and from what I’ve heard, even if you bought MIIF at the IPO price of $1, you’ll still net a return of 1%, which to some people is pretty bad, but in my opinion, at least you didn’t lose any money at all – provided you didn’t sell any of the units of course.
With that said however, APTV is still listed on the SGX, and I’m still deciding if I should “follow” the management by putting money back into APTV. But until then, I’ll guess I’ll see them again some other time.