AIM Rule 26

This page contains the information required by AIM Rule 26 for Aberdeen Frontier Markets Investment Company Limited (“AFMC” or the “Company”).

Description of the business:

The Company is a Guernsey-incorporated, closed-ended investment company and its shares are traded on AIM, the London Stock Exchange’s international market for smaller growing companies.

The objective of the Company is to generate long-term capital growth for its shareholders. The Investment Manager, Aberdeen Asset Managers Limited, a 100% owned subsidiary of Aberdeen Asset Management PLC, invests predominantly in a diversified portfolio of equity and equity related securities of companies listed in, or operating in, Frontier Markets. The proportion of the portfolio invested in each component of Frontier Markets varies according to where the Investment Manager perceives the most attractive investment opportunities to be.

Frontier Market countries may include constituents of the MSCI Frontier Markets Index or additional countries that the Investment Manager deems to be, or displays similar characteristics to, Frontier Market countries.

The number of investments in the portfolio varies depending on the availability of attractive opportunities but, under normal market conditions, falls within a range of 30 to 80. The Company does not seek to exercise control over investee companies.

The Company may, at the Investment Manager’s discretion, hold cash or cash equivalents to protect shareholders’ capital although it is envisaged that the value of these will not generally exceed 10% of net asset value.

Investment philosophy, strategy and process

Although the Manager is an active long-only manager, its investment philosophy and approach has absolute return characteristics. Its investment process is robust and characterised by its discipline, consistency and independence. The Manager is not benchmark-driven and, accordingly, its fund managers do not invest in stocks that fail to meet its investment criteria.

Portfolios are managed by the Manager on a team basis, with individual fund managers doing their own research and analysis. Each asset class has a model portfolio that contains the team’s best ideas for that asset class and forms the basis for constructing individual portfolios focused on that asset class.

The Manager selects securities for the Company’s portfolio employing the investment strategies established by Aberdeen’s global emerging market equity team.

The investment team regularly monitors and makes allocation decisions to determine the Company’s portfolio weightings in equity and equity-related investments. Allocations vary according to relative value and opportunities identified by the team. Whilst the Investment Policy permits it to invest across a wide region, investment opportunities in the region are such that the geographic exposure of the Company’s portfolio may be concentrated on a relatively small number of countries from time to time.

Team members travel to meet companies in Frontier Market countries on a regular basis and no investment is ever made before fund managers have visited several times to meet management and written up detailed research notes. Each company that the Manager invests in is generally visited twice a year. The Manager believes that there is no substitute for first-hand research.

The Manager believes that stock selection is crucial and:

  • Implements intensive company reviews
  • Believes proprietary research gives deeper insight
  • Always meets & interviews a company before investing
  • Believes in quality and price criteria
  • Is independent – and not benchmark driven

The Manager is a long term investor using a buy-and-hold strategy which should result in low portfolio turnover and also sees engagement with the companies that it invests in as a normal part of its relationship with companies. Fund managers vote at general meetings and are supported by governance specialists.

Investment restrictions

The Investment Manager is required to adhere to the following investment restrictions which may be found in the most recent circular issued by the Company here:

The Company has not set maximum or minimum exposures for any geographical regions or sectors and will achieve an appropriate spread of risk by investing in a diversified portfolio of securities. The Company may invest in exchange-traded funds provided they are listed on a recognised investment exchange.

No individual listed or quoted company exposure in the portfolio may exceed 10 per cent. of the Company’s total assets at the time of investment. The Company may invest in exchange-traded funds provided they are listed on a recognised investment exchange.

Risk is spread through investing in a number of holdings and, typically, it is expected that the Company will invest in between 30 to 80 holdings.

No more than 10 per cent. of the Company’s total assets may be invested in other listed closed-ended investment companies, provided that this restriction does not apply to investments in any such investment companies which themselves have published investment policies to invest no more than 15 per cent. of their total assets in other closed-ended investment companies. Additionally, the Company will itself not invest more than 15 per cent. of its total assets in other investment companies or investment trusts which are listed or quoted.

The Company may, at the Manager’s discretion, hold cash or cash equivalents to protect Shareholders’ capital although it is envisaged that the value of these will not generally exceed 10 per cent. of Net Asset Value.

It is intended that the Company will generally be invested in equity investments. However, the Manager may invest in equity related investments such as convertibles or fixed interest securities where there are perceived advantages in doing so.


The Company may borrow up to 10% of its net assets (calculated at the time of draw down) for investment purposes. Furthermore, the Company may use an overdraft and/or other short-term borrowing facilities to meet its working capital needs, including for the payment of any expenses or fees. The same facilities may be used to take advantage of favourable investment opportunities pending the payment of proceeds from the sale of investments.

Directors' biographies

Board responsibilities and Committees

Details of incorporation:
Incorporated in Guernsey with registered number 46809
Registered office: 11 New Street, St Peter Port, Guernsey, GY1 2PF

Main country of operation: UK investment manager with a focus on companies operating in Frontier Markets
As the Company is not incorporated in the UK, the rights of shareholders may be different from the rights of shareholders in a UK incorporated company.

Constitutional documents:

Latest admission document;

Exchanges: AFMC shares are quoted and traded on the Alternative Investment Market (AIM) of the London Stock Exchange.

Authorised Share Capital:

An unlimited number of Ordinary Shares of no par value with each Ordinary Share carrying the right to vote. There are no restrictions on transfer.

Issued Share Capital:

The total number of AFMC Ordinary Shares of no par value in issue is 85,902,608 (including treasury shares).

Shares Held in Treasury: 450,000.

Remaining Ordinary Shares in Issue: The number of remaining Ordinary Shares in issue, with voting rights, is 85,452,608 which is the number that shareholders should use as the denominator for calculations by which they will determine if they are required to notify their interest in, or a change to their interests in, AFMC shares under the FCA’s Disclosure Guidance and Transparency Rules.

Percentage of shares not in public hands: 68%.

Significant Shareholdings:

  • City of London Investment Management - is deemed interested in 25,535,908 (30.0%) ordinary shares in AFMC
  • Aberdeen Standard Investments - is deemed interested in 13,750,000 (16.1%) ordinary shares in AFMC
  • Lazard Asset Management - is deemed interested in 8,781,923 (10.4%) ordinary shares in AFMC
  • Derbyshire County Council Pension Fund - is deemed interested in 5,000,000 (5.9%) ordinary shares in AFMC
  • Aberdeen Emerging Capital - is deemed interested in 3,075,000 (3.6%) ordinary shares in AFMC 
    Director Share Holdings
  • John Whittle – is deemed interested in 18,350 (0.02%) ordinary shares in AFMC.

Annual and interim reports:
See and

Shareholder circulars:


NOMAD and other advisers:

NOMAD - Grant Thornton UK LLP, 30 Finsbury Square, London EC2P 2YU. Telephone +44 207 383 5100

Broker - Numis Securities Limited, The London Stock Exchange Building, 10 Paternoster Square, London EC4M 7LT. Telephone +44 207 260 1000

Investment Manager - Aberdeen Asset Managers Limited, Bow Bells House, 1 Bread Street, London EC4M 9HH. Telephone +44 207 463 6000

Registrar - Capita Registrars (Guernsey) Limited, Longue Hougue House, St Sampson, Guernsey GY2 4JN
UK City Code on Takeovers and Mergers: AFMC is subject to the UK City Code on Takeovers and Mergers.
Governance code: AFMC is not required to comply with the UK Corporate Governance Code (the ‘Code’), issued in April 2016, and does not voluntarily apply the full requirements of the Code. However, the Board has considered the principles and recommendations of the AIC Code of Corporate Governance (“AIC Code”) by reference to the AIC Corporate Governance Guide for Investment Companies (“AIC Guide”) as issued in July 2016. The AIC Code, as explained by the AIC Guide, addresses all the principles set out in the UK Corporate Governance Code (“UK Code”), as well as setting out additional principles and recommendations on issues that are of specific relevance to the Company.

The Board considers that reporting against the principles and recommendations of the AIC Code, and by reference to the AIC Guide (which incorporates the UK Corporate Governance Code), will provide better information to shareholders. The Guernsey Financial Services Commission (“GFSC”) Finance Sector Code of Corporate Governance (the “Guernsey Code”) applies to all companies which hold a licence from the GFSC under the regulatory laws of Guernsey or are registered or authorised as collective investment schemes by the GFSC. Companies which report under the UK Code or the AIC Code are deemed to meet the requirements of the Guernsey Code.

The Company has complied with the recommendations of the AIC Code and the relevant provisions of the UK Corporate Governance Code, except as set out below.

The UK Code includes provisions relating to:

  • the role of the chief executive
  • executive directors’ remuneration
  • the need for an internal audit function

For the reasons set out in the AIC Guide, and as explained in the UK Code, the Board considers these provisions are not relevant to the position of the Company, being an externally managed investment company. In particular, all of the Company’s day-to-day management and administrative functions are outsourced to third parties. As a result, the Company has no executive directors, employees or internal operations.

Policy on Directors’ fees

The Board’s policy is that the remuneration of non-executive directors should be fair and should reflect the experience, work involved, responsibilities and potential liabilities of the Board as a whole. The non-executive directors’ fees are determined within the limits set out in the Company’s Articles of Association and they are not eligible for bonuses, pension benefits, share benefits, share options, long-term incentive schemes or other benefits. It is intended that this policy will continue for the year ending 30 June 2018 and for subsequent years. The maximum amount currently payable in aggregate to the directors is £200,000 per annum. This amount may be changed by the passing of an ordinary resolution of the Company. The current maximum amount was approved by shareholders at the Company’s Annual General Meeting held in December 2013.

No services have been provided by, or fees paid to, advisers in respect of remuneration policy during the year ended 30 June 2017.

Directors’ service contracts

The directors do not have service contracts. The directors have appointment letters subject to termination upon three months’ notice. The directors are all subject to re-election by shareholders at a maximum interval of three years.

This page was correct as at: 5 July 2018