Ancora Advisors Torches The Zweig Total Return Fund
Don't forget - sign up for our free daily newsletter to stay in the activist investing know. Ancora Advisors sent a letter to George Aylward, the Board Chairman at ZTR. Here's a summary and see the full letter below.
Ancora Advisors LLC owns approximately 3.9% of the outstanding common shares of The Zweig Total Return Fund, Inc. Ancora previously sent a letter and communicated with Mr. Aylward and the fund's portfolio managers regarding its concerns over ZTR's significant discount to net asset value ("NAV"). Ancora's current letter further highlights the need for The Zweig Total Return Fund's board of directors to maximize shareholder value by proactively addressing the fund's high discount to NAV and overall subpar performance.
Ancora's letter rejected the justifications used by ZTR's board of directors to not conduct a meaningful tender at or close to NAV. Among other objections, Ancora noted that it was highly suspect for ZTR's board to comment that shareholders have already rejected the open-ending or liquidation of the fund when considering, in all five circumstances the board recommended shareholders vote against taking this action, and the shareholder base wasn't comparable to ZTR's current highly institutional shareholder base. Ancora encouraged ZTR's board to let the shareholders decide again on whether to open-end or liquidate the fund at the 2016 shareholder meeting. Ancora stated that it may seek board representation if the board failed to provide shareholders with a proposal to open-end or liquidate the fund.
On December 23, 2015, a limited partnership advised by Ancora Advisors LLC as the General Partner, separately sent the Board of Directors of The Zweig Total Return Fund, Inc. a proposal pursuant to Rule 14a-8 of the Securities Exchange Act of 1934, calling for the termination of ZTR's investment adviser (Zweig Advisers LLC), for inclusion in the company's proxy statement for the 2016 annual meeting of shareholders.