Asset Value Investors (AVI) has launched a campaign calling for shareholder support to remove and replace Symphony International Holdings' board of directors due to "poor performance".

AVI owns a 15.4% stake in SIHL on behalf of institutional clients. Having first invested in 2012, it now claims that a continued approach of constructive private engagement "has no prospects of success".

Symphony International Holdings is a closed-end investment vehicle managed from Singapore and listed on the London Stock Exchange.

It was formed in 2004 with an investment objective of increasing net asset value through long-term strategic private equity investments in consumer-related businesses - primarily in the hospitality, healthcare and lifestyle sectors in Asia-Pacific (particularly South East Asia and India) - as well as through investments in special situations and structured transactions.

Performance has been poor in absolute terms and when measured against market indices or peer funds, with shareholders invested since the 2007 IPO and those that participated in the 2012 rights issue having suffered a -21% negative return.

This compares to a +89% return from the MSCI AC Asia index and +141% from the MSCI AC World over the same period.

Tom Treanor, executive director of AVI, said: "The poor performance of Symphony International Holdings Ltd has gone on long enough. We have two key aims and we need the support of our fellow shareholders to make them a reality."

The campaign aims to inform shareholders of AVI's concerns regarging the stewardship of SIHL and the independence of the board, "which in our view is inherently conflicted and whose actions have failed to protect shareholder interests ahead of those of the management team".

The second goal is to gather together sufficient support (30%) to requisition an extraordinary general meeting (EGM) to remove the current directors and replace them with new directors "willing and able to properly represent the interests of shareholders".

Treanor added: "We, the shareholders, have suffered years of poor performance overseen by the SIHL board. Set against market comparators, the absolute NAV returns have been extremely poor.

"The impact upon shareholder returns is further exacerbated by the persistently poor share performance and wide discount of share price to NAV (today 50%; averaging c.40%). While shareholders have suffered patiently and without a voice, management has prospered.

"Eye-watering sums of money have been paid by the company to the investment manager. In our view, chronic conflicts of interest exist across the board of directors and explain why this state of affairs has been allowed to continue for so long. 

"We are seeking to work with other shareholders whose holdings when combined with our own hit the 30% threshold required to requisition an EGM at which we will seek the removal of the current board and its replacement with new directors willing and able to properly represent the interests of shareholders."

SIHL today trades at a discount in excess of 50% to estimated NAV. As a result, shareholders who wish to exit their investment in SIHL are forced to accept less than 50 cents on the dollar to do so.

"It is AVI's view that the substantial discount at which SIHL trades represents the market's view as to the company's performance track record, investment proposition, its governance, its manager and its board," the activist said.