The board of directors of Lawrence Enterprise Fund Inc., a Toronto-based labour-sponsored investment fund, said Monday that it is in the best interest of all Class A shareholders to continue to suspend redemptions.
The fund announced Monday the granting of a further order that extends the suspension to July 31.
The fund obtained an initial order in to suspend Class A share redemptions on Jan. 13, 2013. A second order extended the effect of the initial order to Jan. 31, 2014.
The board blames the current economic climate for the continuing suspension.
In a statement the board said “The fund’s portfolio of venture investments cannot be exited in the current market as a result of the lack of IPOs and mergers for the past several years.”
The board said redemptions would pressure the fund “to liquidate its investments in a ‘fire sale’ manner that would cause a significant further reduction in the value of the portfolio investments to the fund and the net asset value of the Class A shares.”
The board and the fund’s manager, Cambridge Asset Management Inc., believe that suspension “will continue to prevent any short and mid-term liquidity challenges, help achieve optimal exit values for maturing portfolio companies and ensure that proceeds generated from those exits are returned to all shareholders.”