The board of the Mobius Investment Trust has approved a tap issuance for the company, which raised £100m in its September Initial Public Offering (IPO), according to portfolio manager Carlos Hardenberg.
Last week, the Mobius Capital Partners co-founder said the decision was part of a "growth strategy" for the trust, which is now trading at a premium of 4.2%, allowing it to issue new shares at a premium to its net asset value (NAV) to meet demand.
The trust has the ability to issue an additional 20% of new shares, amounting to £20m at its current size. At the most recent meeting, the board granted approval for the tap facility to be utilised in response to the trust's increasing premium.
The IPO fundraising was £100m short of its £200m target, with seeding by the managers reported to be at £15m.
Hardenberg commented: "We wanted to raise more but we have been reminded of the toughness of this business.
"In terms of how we want to grow, the board has recently approved a tap issuance, which is underway."
Once the 20% tap has been used, the trust would likely be required to issue a new prospectus if it wished to create further shares via the same mechanism.
Reflecting on the trust's premium, which Hardenberg said the team never experienced in his 15 years at Franklin Templeton running the Templeton Emerging Markets Investment Trust (TEMIT), the manager said the various boards for TEMIT were never "able to address the discount issue in any way".
He added: "It is a totally new experience for me to be dealing with a premium, which could be an equally painful curse."
However, he described the structure put in place on the Mobius Investment Trust - whereby the board has authorised "aggressive buy-backs in case there is a discount" - as a "very robust mechanism".
The trust offers a recurring redemption facility at NAV four years after its exchange admission date and every three years after.
It also actively re-purchases shares once the average one-month discount exceeds a 5% threshold.