Weiss Korea (WKOF ) has proposed a managed wind-down of the sub-scale South Korean equity trust after failing to find an appropriate alternative. 

The board confirmed the trust would be shuttered following ‘extensive consultation’ over its future strategy and having ‘received a number of proposals from third parties’, as it joins a long list of trusts lost from the London market. 

However, none of the suitors were up to scratch for the £106m fund, which is managed by Andrew Weiss and Ethan Lim of Weiss Asset Management, and the board has put forward proposals for a managed wind-down.

The trust commenced a strategic review last November after deep-value specialist investor Weiss warned that the opportunities available had become ‘less attractive’ than at launch in 2013 and said this was unlikely to change in the foreseeable future.

The trust specialises in buying higher-yielding Korean preference shares, which trade at a discount to the regular shares of the same companies. 

Following the review, where the board also considered a change of mandate or combination with another trust, it met with ‘interested parties in late January 2025’ and undertook ‘further detailed discussion’ with one preferred party in February.

However, the search was fruitless, which the board blamed on ‘the complexities associated with the short-listed proposals that came to light in the detailed discussions, combined with differing views received from shareholders’.

This led the board to determine that a managed wind-down ‘was the fairest proposal and would be in the best interests of shareholders as a whole’.

Shareholders will be asked to approve the wind-down, but a liquidation will not happen immediately. Instead, capital will be returned once the assets are sold in an ‘orderly realisation’ in a bid to maximise value.  

Despite being a major winner from the coronavirus pandemic, Weiss Korea’s performance has been decidedly downbeat in the past three years. It has almost doubled the losses made by the MSCI Korea index, which is down 11.6% over the period, as the net asset value (NAV) of the fund tumbled 22.5%. Shareholders are down 28.4%, including dividends reinvested. 

The trust, in which activist value investor City of London is the top shareholder, has a strong overall record across its entire life, however.

From launch in May 2013 to the end of January, the underlying portfolio returned 92%, versus only 52% for its MSCI Korea 25/50 index benchmark, according to the latest factsheet.