UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

FORM N-Q

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file number:

811-08076

 

 

Exact name of registrant as specified in charter:

Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc.

 

 

Address of principal executive offices:

1735 Market Street, 32nd Floor

 

Philadelphia, PA 19103

 

 

Name and address of agent for service:

Ms. Andrea Melia

 

Aberdeen Asset Management Inc.

 

c/o 1735 Market Street, 32nd Floor

 

Philadelphia, PA 19103

 

 

Registrant’s telephone number, including area code:

800-522-5465

 

 

Date of fiscal year end:

October 31

 

 

Date of reporting period:

July 31, 2017

 



 

Item 1. Schedule of Investments

 

The schedule of investments for the three-month period ended July 31, 2017 is filed herewith.

 



 

Shares

 

Description

 

Industry and Percentage
of Net Assets

 

Value
(US$)

 

LONG-TERM EQUITY SECURITIES IN EMERGING MARKET COUNTRIES—96.2%

 

 

 

COMMON STOCKS—95.1%

 

 

 

 

 

BRAZIL—10.3%

 

 

 

 

 

198,961

 

Arezzo Industria e Comercio SA

 

Textiles, Apparel & Luxury Goods— 1.6%

 

$

2,360,722

 

293,155

 

Iguatemi Empresa de Shopping Centers SA

 

Real Estate Management & Development— 2.3%

 

3,450,154

 

112,272

 

Localiza Rent a Car SA

 

Road & Rail— 1.3%

 

1,868,590

 

481,595

 

Odontoprev SA

 

Health Care Providers & Services— 1.3%

 

2,009,252

 

193,845

 

TOTVS SA

 

Software— 1.3%

 

1,864,880

 

165,537

 

Valid Solucoes e Servicos de Seguranca em Meios de Pagamento e Identificacao SA

 

Commercial Services & Supplies— 0.6%

 

895,541

 

249,692

 

Wilson Sons Ltd., BDR

 

Transportation Infrastructure— 1.9%

 

2,819,329

 

 

 

 

 

 

 

15,268,468

 

CHILE—3.2%

 

 

 

 

 

1,791,700

 

Parque Arauco SA

 

Real Estate Management & Development— 3.2%

 

4,709,834

 

 

 

 

 

 

 

CHINA—3.9%

 

 

 

 

 

1,085,092

 

Shenzhen Airport Co. Ltd., A Shares (Stock Connect) (a)

 

Transportation Infrastructure— 1.0%

 

1,446,488

 

1,172,000

 

Tong Ren Tang Technologies Co. Ltd., H Shares (b)

 

Pharmaceuticals— 1.1%

 

1,698,758

 

1,969,400

 

Yanlord Land Group Ltd. (b)

 

Real Estate Management & Development— 1.8%

 

2,630,005

 

 

 

 

 

 

 

5,775,251

 

EGYPT—1.0%

 

 

 

 

 

133,914

 

Edita Food Industries SAE, GDR

 

Food Products— 0.5%

 

703,049

 

2,247,692

 

Juhayna Food Industries (c)

 

Food Products— 0.5%

 

845,629

 

 

 

 

 

 

 

1,548,678

 

HONG KONG—2.6%

 

 

 

 

 

17,839,000

 

Pacific Basin Shipping Ltd. (b)(c)

 

Marine— 2.6%

 

3,897,817

 

 

 

 

 

 

 

 

 

INDIA—15.4%

 

 

 

 

 

235,000

 

Castrol (India) Ltd. (b)

 

Chemicals— 1.0%

 

1,468,166

 

180,000

 

Container Corp. of India Ltd. (b)

 

Road & Rail— 2.2%

 

3,206,765

 

358,744

 

Godrej Consumer Products Ltd. (b)

 

Personal Products— 3.9%

 

5,798,702

 

450,000

 

Kansai Nerolac Paints Ltd. (b)

 

Chemicals— 2.1%

 

3,184,142

 

204,185

 

Mphasis Ltd. (b)

 

Information Technology Services— 1.3%

 

1,916,095

 

82,500

 

Piramal Enterprises Ltd. (b)

 

Pharmaceuticals— 2.5%

 

3,798,138

 

341,000

 

Ramco Cements Ltd. (The) (b)

 

Construction Materials— 2.4%

 

3,615,645

 

 

 

 

 

 

 

22,987,653

 

INDONESIA—9.3%

 

 

 

 

 

45,278,000

 

Ace Hardware Indonesia Tbk PT

 

Specialty Retail— 2.5%

 

3,772,034

 

9,086,300

 

AKR Corporindo Tbk PT

 

Trading Companies & Distributors— 3.2%

 

4,705,454

 

22,277,147

 

Bank Permata Tbk PT (b)(c)

 

Banks— 0.8%

 

1,178,932

 

2,170,000

 

Delfi Ltd.

 

Food Products— 2.1%

 

3,202,597

 

17,142,800

 

Holcim Indonesia Tbk PT (b)(c)

 

Construction Materials— 0.7%

 

1,004,028

 

 

 

 

 

 

 

13,863,045

 

 

See Notes to Portfolio of Investments.

 

Aberdeen Emerging Markets Smaller Company Fund, Inc.

 



 

JORDAN—0.9%

 

 

 

 

 

75,317

 

Hikma Pharmaceuticals PLC (b)

 

Pharmaceuticals— 0.9%

 

$

1,402,000

 

 

 

 

 

 

 

 

 

KENYA—1.2%

 

 

 

 

 

701,800

 

East African Breweries Ltd.

 

Beverages— 1.2%

 

1,788,584

 

 

 

 

 

 

 

 

 

MALAYSIA—5.2%

 

 

 

 

 

4,537,900

 

Aeon Co. (M) Bhd

 

Multiline Retail— 1.6%

 

2,321,149

 

241,500

 

Heineken Malaysia Bhd

 

Beverages— 0.7%

 

1,014,170

 

790,200

 

Oriental Holdings Bhd (b)

 

Automobiles— 0.8%

 

1,215,927

 

2,037,688

 

SP Setia Bhd Group

 

Real Estate Management & Development— 1.1%

 

1,575,324

 

240,000

 

United Plantations Bhd

 

Food Products— 1.0%

 

1,549,924

 

 

 

 

 

 

 

7,676,494

 

MEXICO—3.4%

 

 

 

 

 

98,676

 

Grupo Aeroportuario del Centro Norte SAB de CV, ADR

 

Transportation Infrastructure— 3.4%

 

4,992,019

 

 

 

 

 

 

 

 

 

NETHERLANDS—2.1%

 

 

 

 

 

52,000

 

ASM International NV (b)

 

Semiconductors & Semiconductor Equipment— 2.1%

 

3,129,243

 

 

 

 

 

 

 

 

 

NIGERIA—1.2%

 

 

 

 

 

1,333,263

 

Guaranty Trust Bank PLC

 

Banks— 0.1%

 

141,995

 

2,125,000

 

Guinness Nigeria PLC

 

Beverages— 0.2%

 

383,086

 

19,437,011

 

Zenith Bank PLC

 

Banks— 0.9%

 

1,304,601

 

 

 

 

 

 

 

1,829,682

 

PERU—0.4%

 

 

 

 

 

195,354

 

Grana y Montero SA, ADR (c)

 

Construction & Engineering— 0.4%

 

623,179

 

 

 

 

 

 

 

 

 

PHILIPPINES—4.2%

 

 

 

 

 

915,080

 

Jollibee Foods Corp. (b)

 

Hotels, Restaurants & Leisure— 2.7%

 

4,077,538

 

1,650,000

 

Pilipinas Shell Petroleum Corp.

 

Oil, Gas & Consumable Fuels— 1.5%

 

2,164,685

 

 

 

 

 

 

 

6,242,223

 

POLAND—2.0%

 

 

 

 

 

99,589

 

Dino Polska SA (b)(c)(d)

 

Food & Staples Retailing— 1.0%

 

1,475,765

 

144,115

 

Eurocash SA

 

Food & Staples Retailing— 1.0%

 

1,424,016

 

 

 

 

 

 

 

2,899,781

 

REPUBLIC OF SOUTH KOREA—2.7%

 

 

 

 

 

73,171

 

BNK Financial Group, Inc. (b)

 

Banks— 0.5%

 

739,360

 

3,800

 

Medy-Tox, Inc. (b)

 

Biotechnology— 1.3%

 

2,006,928

 

6,000

 

Shinsegae, Inc. (b)

 

Multiline Retail— 0.9%

 

1,275,100

 

 

 

 

 

 

 

4,021,388

 

ROMANIA—2.1%

 

 

 

 

 

851,000

 

BRD-Groupe Societe Generale SA (b)

 

Banks— 2.1%

 

3,110,234

 

 

 

 

 

 

 

 

 

RUSSIA—0.9%

 

 

 

 

 

133,150

 

Beluga Group PJSC (c)

 

Beverages— 0.9%

 

1,347,311

 

 

 

 

 

 

 

 

 

SOUTH AFRICA—6.0%

 

 

 

 

 

893,654

 

African Oxygen Ltd.

 

Chemicals— 0.9%

 

1,275,510

 

128,384

 

City Lodge Hotels Ltd.

 

Hotels, Restaurants & Leisure— 0.9%

 

1,373,586

 

 

See Notes to Portfolio of Investments.

 



 

204,900

 

Clicks Group Ltd. (b)

 

Food & Staples Retailing— 1.6%

 

$

2,323,204

 

181,276

 

JSE Ltd.

 

Capital Markets— 1.2%

 

1,815,683

 

164,735

 

SPAR Group Ltd. (The) (b)

 

Food & Staples Retailing— 1.4%

 

2,064,802

 

 

 

 

 

 

 

8,852,785

 

SRI LANKA—2.0%

 

 

 

 

 

2,689,150

 

John Keells Holdings PLC

 

Industrial Conglomerates— 2.0%

 

3,043,792

 

 

 

 

 

 

 

 

 

TAIWAN—1.8%

 

 

 

 

 

209,070

 

Poya International Co. Ltd.

 

Multiline Retail— 1.8%

 

2,665,694

 

 

 

 

 

 

 

 

 

THAILAND—5.6%

 

 

 

 

 

2,600,100

 

BEC World PCL, Foreign Shares (b)

 

Media— 1.0%

 

1,445,520

 

190,000

 

Bumrungrad Hospital PCL, Foreign Shares (b)

 

Health Care Providers & Services— 0.7%

 

998,903

 

800,000

 

Central Pattana PCL, Foreign Shares (b)

 

Real Estate Management & Development— 1.1%

 

1,670,981

 

1,679,000

 

Hana Microelectronics PCL, Foreign Shares (b)

 

Electronic Equipment Instruments & Components— 1.3%

 

2,027,172

 

238,399

 

Siam City Cement PCL, Foreign Shares (b)

 

Construction Materials— 1.5%

 

2,228,116

 

 

 

 

 

 

 

8,370,692

 

TURKEY—7.7%

 

 

 

 

 

1,723,011

 

Aksigorta AS (b)(c)

 

Insurance— 1.1%

 

1,557,765

 

240,745

 

AvivaSA Emeklilik ve Hayat AS

 

Insurance— 0.9%

 

1,364,702

 

703,784

 

Cimsa Cimento Sanayi VE Ticaret AS (b)

 

Construction Materials— 2.0%

 

3,012,044

 

319,391

 

Coca-Cola Icecek AS (b)

 

Beverages— 2.6%

 

3,859,657

 

106,978

 

Logo Yazilim Sanayi Ve Ticaret AS (c)

 

Software— 1.1%

 

1,670,320

 

 

 

 

 

 

 

11,464,488

 

 

 

 

 

 

 

141,510,335

 

PRIVATE EQUITY —1.0%

 

 

 

 

 

GLOBAL—0.7%*

 

 

 

 

 

7,248,829

(e)

Emerging Markets Ventures I, L.P. (b)(c)(f)(g)(h)(i)

 

Private Equity— 0.1%

 

123,520

 

2,400,000

(e)

Telesoft Partners II QP, L.P. (b)(c)(f)(g)(j)

 

Private Equity— 0.6%

 

922,272

 

 

 

 

 

 

 

1,045,792

 

ISRAEL—0.3%

 

 

 

 

 

1,674,587

(e)

BPA Israel Ventures, LLC (b)(c)(f)(g)(h)(i)

 

Private Equity— 0.1%

 

158,500

 

72,640

 

Exent Technologies Ltd. Preferred A1 Shares (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

62,304

 

Exent Technologies Ltd. Preferred C Shares (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

15,716

 

Exent Technologies Ltd. Warrants A1 (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

46,856

 

Flash Networks Ltd. Ordinary Shares (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

12

 

Flash Networks Ltd. Series C Preferred (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

23,264

 

Flash Networks Ltd. Series C-1 Preferred (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

13,526

 

Flash Networks Ltd. Series D Preferred (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

9,952

 

Flash Networks Ltd. Series E Preferred (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

22

 

Flash Networks Ltd. Warrants C (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

 

 

See Notes to Portfolio of Investments.

 



 

52

 

Flash Networks Ltd. Warrants Ordinary (b)(c)(f)(g)(j)(k)

 

Private Equity— —%

 

$

 

2,750,000

(e)

Giza GE Venture Fund III, L.P. (b)(c)(f)(g)(i)

 

Private Equity— —%

 

55,220

 

761,184

(e)

Neurone Ventures II, L.P. (b)(c)(f)(g)(j)

 

Private Equity— 0.2%

 

243,221

 

32,574

 

Vidyo, Inc. Trust A (Preferred) (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

15,531

 

Vidyo, Inc. Trust B (Preferred) (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

13,219

 

Vidyo, Inc. Trust B1 (Preferred) (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

6,864

 

Vidyo, Inc. Trust C (Preferred) (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

4,150

 

Vidyo, Inc. Trust C1 (Preferred) (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

1,802

 

Vidyo, Inc. Trust Common (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

2,713

 

Vidyo, Inc. Trust D (Preferred) (b)(c)(f)(g)(j)(l)

 

Private Equity— —%

 

 

 

 

 

 

 

 

456,941

 

 

 

 

 

 

 

1,502,733

 

PREFERRED STOCK—0.1%

 

 

 

 

 

MALAYSIA—0.1%

 

 

 

 

 

767,512

 

SP Setia Bhd Group, Preferred Shares (c)(m)

 

Real Estate Management & Development— 0.1%

 

206,152

 

 

 

 

 

 

 

206,152

 

RIGHT—0.0%

 

 

 

 

 

NIGERIA—0.0%

 

 

 

 

 

965,909

 

Guinness Nigeria PLC (c)

 

Beverages— —%

 

21,338

 

 

 

 

 

 

 

21,338

 

 

Total Long-Term Equity Securities in Emerging Market Countries—96.2% (cost $145,858,627)

 

143,240,558

 

 

 

 

 

 

 

 

 

LONG-TERM EQUITY SECURITIES IN DEVELOPED MARKET COUNTRIES—2.0%

 

 

 

COMMON STOCK—2.0%

 

 

 

 

 

UNITED STATES—2.0%

 

 

 

 

 

35,162

 

EPAM Systems, Inc. (c)

 

Information Technology Services— 2.0%

 

3,021,471

 

 

 

 

 

 

 

3,021,471

 

PRIVATE EQUITY —0.0%

 

 

 

 

 

UNITED STATES—0.0%

 

 

 

 

 

1,952,000

(e)

Technology Crossover Ventures IV, L.P. (b)(c)(f)(g)(h)(i)

 

Private Equity— —%

 

2,264

 

 

 

 

 

 

 

2,264

 

 

 

Total Long-Term Equity Securities in Developed Market Countries—2.0% (cost $1,710,877)

 

3,023,735

 

SHORT-TERM INVESTMENT—2.0%

 

 

 

 

 

UNITED STATES—2.0%

 

 

 

 

 

2,960,178

 

State Street Institutional U.S. Government Money Market Fund(n)

 

 

 

2,960,178

 

 

 

Total Short-Term Investment—2.0% (cost $2,960,178)

 

2,960,178

 

 

 

Total Investments—100.2% (cost $150,529,682) (o)

 

149,224,471

 

 

 

Liabilities in Excess of Other Assets—(0.2)%

 

(365,472

)

 

 

Net Assets—100.0%

 

 

 

$

148,858,999

 

 


(a)

China A Shares. These shares are issued in local currency, traded in the local stock markets and are held through either a Qualified Foreign Institutional Investor (QFII) license or the Shanghai or Shenzhen Hong-Kong Stock Connect program.

 

See Notes to Portfolio of Investments.

 



 

(b)

Fair Values are determined pursuant to procedures approved by the Fund’s Board of Directors. Unless otherwise noted, securities are valued by applying valuation factors to the exchange traded price. See Note (a) of the accompanying Notes to Portfolio of Investments.

(c)

Non-income producing security.

(d)

Denotes a security issued under Regulation S or Rule 144A.

(e)

Represents contributed capital.

(f)

Restricted security, not readily marketable. See Note (b) of the accompanying Notes to Portfolio of Investments.

(g)

Illiquid security.

(h)

As of July 31, 2017, the aggregate amount of open commitments for the Fund is $1,524,584.

(i)

In liquidation.

(j)

Active investments.

(k)

Exent Technologies Ltd. and Flash Networks Ltd. were securities received from the dissolution of Concord Fund I Liquidating Main Trust. See Note (b) of the accompanying Notes to Portfolio of Investments.

(l)

Vidyo, Inc. Trust was a spinoff from SVE Star Ventures IX. See Note (b) of the accompanying Notes to Portfolio of Investments.

(m)

Redeemable Convertible Preferred security.

(n)

Registered investment company advised by State Street Global Advisors.

(o)

See accompanying Notes to Portfolio of Investments for tax unrealized appreciation/(depreciation) of securities.

*

“Global” is the percentage attributable to the Fund’s holdings in a private equity fund which invests globally and is not categorized under a particular country.

 

 

ADR

American Depositary Receipt

BDR

Brazilian Depositary Receipt

GDR

Global Depositary Receipt

 

See Notes to Portfolio of Investments.

 



 

Notes to Portfolio of Investments (unaudited)

 

July 31, 2017

 

Summary of Significant Accounting Policies

 

a. Security Valuation:

 

The Fund values its securities at current market value or fair value, consistent with regulatory requirements. “Fair value” is defined in the Fund’s Valuation and Liquidity Procedures as the price that could be received to sell an asset or paid to transfer a liability in an orderly transaction between willing market participants without a compulsion to transact at the measurement date.

 

Equity securities that are traded on an exchange are valued at the last quoted sale price on the principal exchange on which the security is traded at the “Valuation Time” subject to application, when appropriate, of the valuation factors described in the paragraph below. The Valuation Time is as of the close of regular trading on the New York Stock Exchange (usually 4:00 p.m. Eastern Time). In the absence of a sale price, the security is valued at the mean of the bid/ask price quoted at the close on the principal exchange on which the security is traded. Securities traded on NASDAQ are valued at the NASDAQ official closing price. Closed-end funds and exchange-traded funds (“ETFs”) are valued at the market price of the security at the Valuation Time. A security using any of these pricing methodologies is determined to be a Level 1 investment.

 

Foreign equity securities that are traded on foreign exchanges that close prior to the Valuation Time are valued by applying valuation factors to the last sale price or the mean price as noted above. Valuation factors are provided by an independent pricing service provider approved by the Fund’s Board of Directors (the “Board”). These valuation factors are used when pricing the Fund’s portfolio holdings to estimate market movements between the time foreign markets close and the time the Fund values such foreign securities. These valuation factors are based on inputs such as depositary receipts, indices, futures, sector indices/ETFs, exchange rates, and local exchange opening and closing prices of each security. When prices with the application of valuation factors are utilized, the value assigned to the foreign securities may not be the same as quoted or published prices of the securities on their primary markets. A security that applies a valuation factor is determined to be a Level 2 investment because the exchange-traded price has been adjusted. Valuation factors are not utilized if the independent pricing service provider is unable to provide a valuation factor or if the valuation factor falls below a predetermined threshold; in such case, the security is determined to be a Level 1 investment.

 

Short-term investments are comprised of cash and cash equivalents invested in short-term investment funds which are redeemable daily. The Fund sweeps available cash into the State Street Institutional U.S. Government Money Market Fund, which has elected to qualify as a “government money market fund” pursuant to Rule 2a-7 under the Investment Company Act of 1940, as amended, and has an objective, which is not guaranteed, to maintain a $1.00 per share net asset value. Generally, these investment types are categorized as Level 1 investments.

 

In the event that a security’s market quotations are not readily available or are deemed unreliable (for reasons other than because the foreign exchange on which it trades closes before the Valuation Time), the security is valued at fair value as determined by the Fund’s Pricing Committee, taking into account the relevant factors and surrounding circumstances using valuation policies and procedures approved by the Board. A security that has been fair valued by the Fund’s Pricing Committee may be classified as Level 2 or Level 3 depending on the nature of the inputs.

 

The Fund may also invest in private equity private placement securities, which represented 1.0% of the net assets of the Fund as of July 31, 2017. The private equity private placement securities in which the Fund is invested are deemed to be restricted securities. In the absence of readily ascertainable market values, these securities are valued at fair value as determined in good faith by, or under the direction of the Board, pursuant to valuation policies and procedures established by the Board. The Fund’s estimate of fair value assumes a willing buyer and a willing seller neither of whom are acting under the compulsion to buy or sell. Although these securities may be resold in privately negotiated transactions, the prices realized on such sales could differ from the prices originally paid by the Fund or the current carrying values, and the difference could be material. These securities are stated at fair value as determined by the Fund’s Pricing Committee by utilizing the net asset valuations provided by the underlying funds as a practical expedient. In determining the fair value of these investments, management uses the market approach which includes as the primary input the capital balance reported; however, adjustments to the reported capital balance may be made based on various factors, including, but not

 



 

Notes to Portfolio of Investments (unaudited) (continued)

 

July 31, 2017

 

limited to, the attributes of the interest held, including the rights and obligations, and any restrictions or illiquidity of such interests, and the fair value of these private equity investments.

 

In accordance with the authoritative guidance on fair value measurements and disclosures under accounting principles generally accepted in the United States of America, the Fund discloses the fair value of its investments using a three-level hierarchy that classifies the inputs to valuation techniques used to measure the fair value. The hierarchy assigns Level 1 measurements to valuations based upon unadjusted quoted prices in active markets for identical assets, Level 2 measurements to valuations based upon other significant observable inputs, including adjusted quoted prices in active markets for similar assets, and Level 3 measurements to valuations based upon unobservable inputs that are significant to the valuation. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability, which are based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. A financial instrument’s level within the fair value hierarchy is based upon the lowest level of any input that is significant to the fair value measurement. The three-level hierarchy of inputs is summarized below:

 

Level 1 — quoted prices in active markets for identical investments;

Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, and credit risk); or

Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments).

 

The following is a summary of the inputs used as of July 31, 2017 in valuing the Fund’s investments and other financial instruments at fair value. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Please refer to the Portfolio of Investments for a detailed breakout of the security types:

 

Investments, at Value

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Long-Term Investments

 

 

 

 

 

 

 

 

 

Banks

 

$

1,446,596

 

$

5,028,526

 

$

 

$

6,475,122

 

Beverages

 

4,533,151

 

3,859,657

 

 

8,392,808

 

Capital Markets

 

1,815,683

 

 

 

1,815,683

 

Chemicals

 

1,275,510

 

4,652,308

 

 

5,927,818

 

Commercial Services & Supplies

 

895,541

 

 

 

895,541

 

Construction & Engineering

 

623,179

 

 

 

623,179

 

Food & Staples Retailing

 

1,424,016

 

5,863,771

 

 

7,287,787

 

Food Products

 

6,301,199

 

 

 

6,301,199

 

Health Care Providers & Services

 

2,009,252

 

998,903

 

 

3,008,155

 

Hotels, Restaurants & Leisure

 

1,373,586

 

4,077,538

 

 

5,451,124

 

Industrial Conglomerates

 

3,043,792

 

 

 

3,043,792

 

Information Technology Services

 

3,021,471

 

1,916,095

 

 

4,937,566

 

Insurance

 

1,364,702

 

1,557,765

 

 

2,922,467

 

Multiline Retail

 

4,986,843

 

1,275,100

 

 

6,261,943

 

Oil, Gas & Consumable Fuels

 

2,164,685

 

 

 

2,164,685

 

Real Estate Management & Development

 

9,941,464

 

4,300,986

 

 

14,242,450

 

Road & Rail

 

1,868,590

 

3,206,765

 

 

5,075,355

 

Software

 

3,535,200

 

 

 

3,535,200

 

Specialty Retail

 

3,772,034

 

 

 

3,772,034

 

Textiles, Apparel & Luxury Goods

 

2,360,722

 

 

 

2,360,722

 

Trading Companies & Distributors

 

4,705,454

 

 

 

4,705,454

 

Transportation Infrastructure

 

9,257,836

 

 

 

9,257,836

 

Other

 

 

36,280,038

 

 

36,280,038

 

Rights

 

21,338

 

 

 

21,338

 

Short-Term Investment

 

2,960,178

 

 

 

2,960,178

 

Total

 

$

74,702,022

 

$

73,017,452

 

$

 

$

147,719,474

 

Private Equity (a)

 

 

 

 

 

 

 

1,504,997

 

Total Investments

 

 

 

 

 

 

 

$

149,224,471

 

 


Amounts listed as “-” are $0 or round to $0.

 

(a)    Private Equity investments are measured at the net asset valuations, as a practical expedient for fair value, and are not required to be classified in the fair value hierarchy as per Accounting Standards Update 2015-07. The fair value amounts presented are intended to permit reconciliation to the total investment amount presented in the Portfolio of Investments.

 



 

Notes to Portfolio of Investments (unaudited) (continued)

 

July 31, 2017

 

For movements between the levels within the fair value hierarchy, the Fund has adopted a policy of recognizing transfers at the end of each period. The utilization of valuation factors may result in transfers between Level 1 and Level 2. For the period ended July 31, 2017, securities issued by Clicks Group Ltd., Oriental Holdings Bhd, Piramal Enterprises Ltd. and SPAR Group Ltd. (The) transferred from Level 1 to Level 2 at the values of $2,323,204, $1,215,927, $3,798,138 and $2,064,802, respectively, because there was a valuation factor applied at July 31, 2017. Securities issued by Ace Hardware Indonesia Tbk PT, Aeon Co. (M) Bhd, African Oxygen Ltd., AKR Corporindo Tbk PT, Eurocash SA, Heineken Malaysia Bhd, JSE Ltd. and Poya International Co. Ltd. transferred from Level 2 to Level 1 at the values of $3,772,034, $2,321,149, $1,275,510, $4,705,454, $1,424,016, $1,014,170, $1,815,683 and $2,665,694, respectively, because there was not a valuation factor applied at July 31, 2017.

 

For the period ended July 31, 2017, there were no significant changes to the fair valuation methodologies.

 

b. Private Equity Investments:

 

Certain of the Fund’s investments, listed in the chart below, are restricted as to resale and are valued at fair value as determined in good faith by, or under the direction of, the Board under procedures established by the Board in the absence of readily ascertainable market values.

 

Security (1)

 

Acquisition Date(s)

 

Total
Commitments

 

Cost

 

Fair Value
At 7/31/17

 

Percent
of
Net
Assets

 

Cumulative
Distributions
Received (2)

 

BPA Israel Ventures, LLC (3)

 

10/05/00 – 12/09/05

 

$

2,300,000

 

$

904,952

 

$

158,500

 

0.11

 

$

352,823

 

Emerging Markets Ventures I, L.P. (3)

 

01/22/98 – 01/10/06

 

8,100,000

 

2,474,673

 

123,520

 

0.08

 

7,567,734

 

Exent Technologies Ltd. Preferred A1 Shares (4)

 

11/29/15

 

 

118,799

 

 

 

 

Exent Technologies Ltd. Preferred C Shares (4)

 

11/29/15

 

 

 

 

 

 

Exent Technologies Ltd. Warrants A1 (4)

 

11/29/15

 

 

 

 

 

 

Flash Networks Ltd. Ordinary Shares (4)

 

11/29/15

 

 

109,226

 

 

 

 

Flash Networks Ltd. Series C Preferred (4)

 

11/29/15

 

 

 

 

 

 

Flash Networks Ltd. Series C-1 Preferred (4)

 

11/29/15

 

 

 

 

 

 

Flash Networks Ltd. Series D Preferred (4)

 

11/29/15

 

 

 

 

 

 

Flash Networks Ltd. Series E Preferred (4)

 

11/29/15

 

 

 

 

 

 

Flash Networks Ltd. Warrants C (4)

 

11/29/15

 

 

 

 

 

 

Flash Networks Ltd. Warrants Ordinary (4)

 

11/29/15

 

 

 

 

 

 

Giza GE Venture Fund III, L.P.

 

01/31/00 – 11/23/06

 

2,750,000

 

1,674,005

 

55,220

 

0.04

 

928,289

 

Neurone Ventures II, L.P.

 

11/24/00 – 12/21/10

 

750,000

 

121,786

 

243,221

 

0.16

 

533,564

 

Technology Crossover Ventures IV, L.P. (3)

 

03/08/00 - 09/27/10

 

2,000,000

 

359,691

 

2,264

 

 

3,045,426

 

Telesoft Partners II QP, L.P.

 

07/14/00 - 03/01/10

 

2,400,000

 

1,112,731

 

922,272

 

0.62

 

1,282,411

 

Vidyo, Inc. Trust A (Preferred) (5)

 

10/24/12

 

 

29,796

 

 

 

 

Vidyo, Inc. Trust B (Preferred) (5)

 

10/24/12

 

 

14,207

 

 

 

 

Vidyo, Inc. Trust B1 (Preferred) (5)

 

10/24/12

 

 

12,092

 

 

 

 

Vidyo, Inc. Trust C (Preferred) (5)

 

10/24/12

 

 

6,279

 

 

 

 

Vidyo, Inc. Trust C1 (Preferred) (5)

 

10/24/12

 

 

3,796

 

 

 

 

Vidyo, Inc. Trust Common (5)

 

10/24/12

 

 

1,648

 

 

 

 

Vidyo, Inc. Trust D (Preferred) (5)

 

10/24/12

 

 

2,482

 

 

 

 

Total

 

 

 

$

18,300,000

 

$

6,946,163

 

$

1,504,997

 

1.01

 

$

13,710,247

 

 

Amounts listed as “—” are $0 or round to $0.

 



 

Notes to Portfolio of Investments (unaudited) (concluded)

 

July 31, 2017

 

(1) Exent Technologies Ltd., Flash Networks Ltd., Neurone Ventures II, L.P., Telesoft Partners II QP, L.P. and Vidyo, Inc. Trust are still considered active investments by the Fund’s Adviser. BPA Israel Ventures, LLC, Giza GE Venture Fund III, L.P., Emerging Markets Ventures I, L.P. and Technology Crossover Ventures IV, L.P. are in liquidation.

 

(2) Cumulative Distributions include distributions received from income, realized gains or return of capital. Distributions from return of capital will reduce the cost basis of the security.

 

(3) BPA Israel Ventures LLC has open commitments of $625,413. Emerging Markets Ventures I, L.P. has open commitments of $851,171. Technology Crossover Ventures IV, LP has open commitments of $48,000.

 

(4) Exent Technologies Ltd. and Flash Networks Ltd. were securities received from the dissolution of Concord Fund I Liquidating Main Trust.

 

(5) Vidyo Inc., Trust was a spinoff from SVE Star Ventures IX. SVE Star Ventures IX reached the end of its term in 2012 and, accordingly, its entire portfolio was sold in a secondary transaction which closed on December 24, 2012. During the secondary transaction, the Fund’s pro rata holdings in Vidyo (and its affiliate Delta Vidyo) were excluded from the transaction, placed in trust and considered as a distribution-in-kind.

 

The Fund may incur certain costs in connection with the disposition of the above securities.

 

c. Rights Issues and Warrants:

 

Rights issues give the right, normally to existing shareholders, to buy a proportional number of additional securities at a given price (generally at a discount) within a fixed period (generally a short-term period) and are offered at the company’s discretion. Warrants are securities that give the holder the right to buy common stock at a specified price for a specified period of time. Rights issues and warrants are speculative and have no value if they are not exercised before the expiration date. Rights issues and warrants are valued at the last sale price on the exchange on which they are traded.

 

d. Federal Income Taxes:

 

The U.S. federal income tax basis of the Fund’s investments and the net unrealized depreciation as of July 31, 2017 were as follows:

 

Cost

 

Appreciation

 

Depreciation

 

Net
Unrealized
Depreciation

 

$

 150,529,682

 

$

32,812,345

 

$

(34,117,556

)

$

(1,305,211

)

 



 

Item 2. Controls and Procedures

 

(a)         The Registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the Investment Company Act of 1940 (17 CFR 270.30a3(b)) and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (17 CFR 240.13a-15(b) or 240.15d-15(b)).

 

(b)         There was no change in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940 (17 CFR 270.30a-3(d))) that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 3. Exhibits

 

(a)         Certification of Principal Executive Officer and Principal Financial Officer of the Registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is attached hereto as Exhibit 99.302CERT.

 



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc.

 

By:

/s/ Christian Pittard

 

 

Christian Pittard,

 

 

Principal Executive Officer of

 

 

Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc.

 

 

 

 

Date: September 28, 2017

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

By:

/s/ Christian Pittard

 

 

Christian Pittard,

 

 

Principal Executive Officer of

 

 

Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc.

 

 

 

 

Date: September 28, 2017

 

 

By:

/s/ Andrea Melia

 

 

Andrea Melia,

 

 

Principal Financial Officer of

 

 

Aberdeen Emerging Markets Smaller Company Opportunities Fund, Inc.

 

 

 

 

Date: September 28, 2017