A rival below-market proposal for Hunter Hall International has emerged from Pinnacle Investment Management, as the fate of listed investment company Hunter Hall Global Value remains undecided.

Pinnacle is offering $1.50-a-share cash to Hunter Hall International investors, which is higher than Washington H. Soul Pattinson's $1-a-share offer, but still below the market value of the $900 million-plus ethical funds management empire. Hunter Hall International shares closed at $2.36 on Monday; Pinnacle's offer rises to $2 a share if it gets more than 50 per cent of the register.

Soul Patts owns 19.9 per cent of the company following a $1-a-share deal struck last month with founder Peter Hall, who still retains a 24 per cent interest. Realistically, Pinnacle would have to get Soul Patts to sell its stake, and convince Mr Hall to accept its offer, to have a chance of reaching the 50 per cent watermark. Mr Hall has previously said he is not motivated by money.

The board of Hunter Hall International advised shareholders to take no action and will give Pinnacle's proposal "full consideration" when the formal offer is received, a spokesman said. Pinnacle, which raised $30 million using an underwritten placement to fund its bid, referenced "the recent poor performance of the Hunter Hall managed funds and listed investment company" in its statement of intent.

Meanwhile, Geoff Wilson's Wilson Asset Management is still awaiting a decision from the board of Hunter Hall Global Value after last week requesting an equal-access share buyback as a vehicle for shareholders to exit the listed investment company at net tangible asset value. Wilson Asset Management, or WAM, owns more than 11 per cent of the company and threatened to roll the board if they do not comply.

"We've asked the Hunter Hall Global Value board to treat all shareholders fairly and equitably and we await their response," Mr Wilson said. Pinnacle's interest in Hunter Hall International does not affect WAM's position, he added.

Steady stream of fee income

Hunter Hall Global Value or HHV is regarded as a jewel in the Hunter Hall empire because its management agreement has 12 years left to run, earning Hunter Hall International a steady stream of fee income which totalled $5 million in 2015-16. Since WAM's request to the board of HHV, the value of Hunter Hall International shares has fallen from $2.88 on January 17 to $2.36 on Monday.

After Mr Hall quit as Hunter Hall's chief investment officer last month, WAM seized on a fall in HHV's share price to again lift its stake in the listed investment company. Mr Hall once likened WAM's ascension up the HHV register as letting "the tiger into the castle". It was Mr Hall's exit from his eponymous fund manager that paved the way for coal backer Soul Patts to become a major investor in Hunter Hall International. Soul Patts has so far declined to comment on the imbroglio at HHV.

WAM's relationship with HHV goes back to August 2014 when Mr Wilson's interests exceeded the 5 per cent level deemed substantial. The discount to NTA or net tangible asset backing – meaning the difference between its share price and the value of its holdings – was around 12 per cent at the time and was an enduring problem for HHV shareholders. When HHV conducted a poorly timed rights issue, WAM's participation lifted its stake above 10 per cent in April 2015.

Supporters of Mr Wilson say the only reason the discount to NTA has narrowed is because WAM was buying shares up until at least January 12 of this year, according to ASX disclosures, and because Mr Wilson's activism has brought the LIC to the attention of the broader market.

The stoush is being closely followed by funds management industry insiders. Those who do not endorse Mr Wilson's all-access buyback speculate that HHV's discount is not wide enough to warrant implementing such a scheme. Also, the board of HHV have already approved a share buyback for the purpose of addressing any discount but it remains inactive. Funding an open-ended buyback could mean liquidating some positions in the portfolio, risking flow-on effects for those stocks.