7IM suspends two funds on liquidity concerns

7IM suspends two funds on liquidity concerns

Seven Investment Management has suspended two of its funds following liquidity concerns.

The firm has taken the decision to suspend trading in the £33m 7IM Absolute Return Portfolio and £20m 7IM Income Portfolio due to “ongoing liquidity challenges” faced by the strategies.

Although the company says it does not anticipate significant outflows, the funds are being suspended to ensure any further withdrawals would not result in unacceptable levels of illiquidity.

The discretionary fund manager said in a statement: “Both the 7IM Absolute Return Portfolio and the 7IM Income Portfolio have exposure to two investments which are facing ongoing liquidity challenges. 

“In light of this, 7IM decided that a fund suspension was necessary to protect the interests of all investors. The options to resolve the suspension will continue to be evaluated.”

The funds each have positions of around 10 per cent in the Xenfin Securitised Debt fund, which has been suspended since 2019. They also hold the Drum Income Plus Reit, which earlier this month launched a strategic review into its future, citing "challenges in generating any meaningful liquidity in the shares". 

Both of the suspended strategies were formerly run by Edinburgh-based discretionary Tcam Asset Management, which 7IM acquired in 2018 for an undisclosed fee

Jon Yarker is a freelance reporter for FTAdviser