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VENTURES: Flax Folds Phoenix Plan


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Mike Flax, Executive Director of Madison Property Fund Managers announced this week that Madison will not be going ahead with the listing on the Bermuda Stock Exchange of their proposed Phoenix Global Investments Fund.  This, he said, was due to the disappointing results of subscriptions in the Initial Public Offering (IPO) which fell short of the Madison’s self-imposed minimum level.  Those who subscribed for shares on the IPO of the new fund are being reimbursed.

Flax said: “In the best interests of shareholders, we were mindful of the fact that capital raised would not have provided a significant enough asset base to fulfil the diversified strategy as communicated in the Prospectus and during our investor presentations.  This was largely as a result of certain high-profile (although totally unrelated) events that coincided with the Phoenix IPO close.  These events created investor uncertainty and nervousness and contributed very significantly to the decision taken to cancel the listing.”

At one stage,” said Flax, “it seemed that we would comfortably exceed the USA $200 million target that we had set for ourselves – the response from individuals with whom we had worked previously was particularly positive.  However, at the eleventh hour, due to the events described, two major institutions decided to withdraw.”

Flax said that he and his co-directors, who between them were participating personally in the IPO, were bitterly disappointed – but this had not changed their view that there still are excellent offshore listed property investment possibilities available in line with the original strategy

Among those to regret the cancellation of the project was Bill Rawson, Chairman of the multi-franchise residential marketing group that carries his name.

The team lined up to manage this fund was one of the most experienced and successful ever to come together in SA,” he said.  “This gave potential investors huge confidence.  It is a great pity that so promising a venture, like so many others recently should be held back because of investors’ reluctance to participate.”

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