TAP Venture Fund I faces legal action from 16 preference shareholders who invested $35m
A venture fund approved under the Government's Global Investor Programme (GIP) is under scrutiny after 16 of 22 remaining preference shareholders took legal action against it.
At dispute is the amount of return capital the fund, TAP Venture Fund I, can make to these 16 shareholders, who have invested some $35 million in it. The other six, who invested another $10.5 million, have yet to redeem their capital as well. TAP was put under interim judicial management earlier this month, in what is believed to be the first time that a GIP fund is in such a situation.
In court documents seen by The Straits Times, plaintiffs said they had "good reason to believe that the (management) of the fund will not act in its best interest".
They earlier also charged that there were "serious conflicts of interest on the part of the management", which had caused losses to the fund, suggesting that the situation could worsen if left unchecked.
The GIP aims to attract high-level investors and entrepreneurs to live in Singapore, allowing foreigners to apply for permanent residency if they invest at least $2.5 million to start or expand a business here, or in a GIP fund that invests in Singapore-based companies. It is run by Contact Singapore, a division of the Economic Development Board (EDB).
Funds approved under the programme such as TAP are assessed by an independent agency and selection panel, while GIP fund managers must be based in Singapore and regulated by the Monetary Authority of Singapore (MAS).
Replying to queries, EDB and MAS spokesmen said the agencies are aware of the legal proceedings involving TAP, although both said they cannot comment on the case as it remains before the court.