A group of investors in the funds operated by troubled fund manager Bridging Finance Inc. (BFI) is calling on regulators to arrange a sale of the funds.
On April 30, the Ontario Superior Court of Justice appointed PricewaterhouseCoopers Inc. (PwC) the receiver of BFI and its funds and assets amid an ongoing investigation by the Ontario Securities Commission (OSC) that had uncovered evidence of alleged conflicts of interest.
The OSC hasn’t made any formal allegations against BFI. The move to put the company into receivership was sought to preserve BFI’s assets amid the investigation.
Now, a group of investors in the Bridging funds has issued a statement calling on the OSC and PwC to arrange the sale of BFI and/or its funds to another fund manager.
After the firm was placed in receivership, redemptions and distributions from the funds were suspended in order to protect the funds’ assets.
Monday’s statement from investors called on the OSC and PwC “to establish an orderly and transparent sale of Bridging and/or its funds, given the multiple credible expressions of interest received to date and the need to protect the interests of Bridging’s unitholders.”
In the statement, the investors said an immediate sale to another fund manager “is critically important to ensure that unitholder value is not eroded.”
The statement also claimed that the receivership process is negatively impacting BFI’s business, and that the “receivership is an inherent conflict as PwC has every interest in continuing the receivership to collect fees.”
The OSC declined to comment on the statement, citing its ongoing enforcement investigation and the court-supervised receivership process.
PwC also declined to comment, saying it “will not be responding to public statements” and that its communications will be delivered through its receiver reports and court statements.
In its latest letter to unitholders on May 12, PwC said it was “actively engaged in developing a strategy to maximize the value of the Bridging funds to the benefit of unitholders and other stakeholders.”