I’ll stay until 90, says WAM chairman Geoff Wilson

WAM Capital chairman Geoff Wilson has offered to remain in the position until he is 90, as he defended the company’s performance and its approach to value creation.

Geoff Wilson at Double Bay in Sydney's east. Picture: John Feder / The Australian

WAM Capital chairman Geoff Wilson has offered to remain in the position until he is 90, as he defended the company’s performance and its approach to value creation.

At the annual meeting of his flagship listed investment company, the 63 year-old said he was taken out of context when quoted in The Australian on Monday saying he would advise his daughter not to invest in WAM Capital because it was trading at a premium to its book value.

WAM Capital is using its premium to net tangible assets to make a scrip bid for a rival LIC – Paul Moore’s PM Capital Asian Opportunities Fund (PAF), which has been trading at a discount to its NTA.

The independent expert Lonergan Edwards has advised shareholders to reject the WAM offer and accept the rival in-house bid from PM Global Capital Opportunities (PGF), even though its implied value could be lower.

“In our view, the significant ­dilution in net tangible assets under the WAM offer is not reasonably compensated by the potentially higher consideration,” Lonergan Edwards said.

Mr Wilson acknowledged on Tuesday he had said in 2019 that he would advise his daughter not to buy WAM Capital shares because they were trading at a premium and not a discount.

“(But) most of those quotes were taken out of context,” he said.

“As I’ve always said, and I’ve said at AGMs before, in theory you want to buy $1 of assets as cheaply as you can.

“If you can buy $1 of assets at 80c, that’s what you do; that’s what we do, but if $1 of assets are trading at $1.10 or $1.20, you have to question: ‘Why is that the case?

“I actually bought some WAM Capital at probably a 10-15 per cent premium to NTA (earlier this year) when the Amaysim takeover bid was on, at around that $2.08-$2.09 level, so I’m happy to buy at a premium if I believe that the outperformance will be good over time.”

Mr Wilson said an investor would of course prefer to buy shares in an LIC if it was trading at a discount rather than a premium.

But the market was the market, and the real question was what the company could deliver to the investor “over time”.

“And whatever premium we have, we’ve got to outperform by that,” the stock tipper said.

Despite PAF’s strong resistance, WAM Capital has passed the 10 per cent mark after making its bid unconditional.

Mr Wilson also retains a strong level of support from 43,000 WAM Capital shareholders, with resolutions passed overwhelmingly.

One shareholder, referred to only as John, asked how long investors could hope for Mr Wilson to continue his “excellent chairmanship”.

A number of years ago, the WAM Capital boss said he had thought that reaching the milestone age of 80 might see him out.

“But when we created the Future Generation investment vehicles, and one of them supported youth mental health, everyone on the mental health side said you don’t retire; you keep going,” Mr Wilson said.

“So I’ve put that out now. My dad made it until 87. By just looking at numbers and when I was born, I’m probably going to make it to 93.

“Who knows? I’m happy to be chair at 90, if you’ll have me.”