PJF Prospect Japan

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION (INCLUDING THE UNITED STATES) WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION. THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

FOR IMMEDIATE RELEASE

27 June 2017

RECOMMENDED ALL-SHARE OFFER

for

THE PROSPECT JAPAN FUND LIMITED

(a non-cellular company incorporated in Guernsey with registration number 28863)

by

PROSPECT CO., LTD.
(a company incorporated in Japan)

to be implemented by means of a scheme of arrangement
under Part VIII of the Companies (Guernsey) Law, 2008

Publication of Scheme Document

On 31 May 2017, the independent directors of The Prospect Japan Fund Limited (the “Independent TPJF Directors”) (“TPJF” or the “Company”) and the board of directors of Prospect Co., Ltd. (“Prospect”) announced that they had reached agreement on the terms of a recommended share for share exchange offer to be made by Prospect for the entire issued and to be issued share capital of TPJF (the “Offer”).

It was also announced that the Offer would be implemented by way of a Court-sanctioned scheme of arrangement between TPJF and its shareholders under Part VIII of the Companies Law of Guernsey (the “Scheme”).

The Independent TPJF Directors are pleased to announce that the scheme document (the “Scheme Document”) in relation to the Offer is being posted, or made available, to TPJF Shareholders today, together with the Forms of Proxy for the Meetings and the Forms of Settlement. The Scheme Document sets out, amongst other things, the full terms and conditions of the Scheme, an explanatory statement, an expected timetable of principal events, details of the settlement process, notices of the Court Meeting and the TPJF General Meeting and details of the action to be taken by TPJF Shareholders.

As further detailed in the Scheme Document, in order to become Effective, the Scheme requires, amongst other things, the approval of a majority in number of the Scheme Shareholders present and voting in person or by proxy at the Court Meeting, representing not less than 75 per cent. in value of the Scheme Shares held by such Scheme Shareholders, together with the sanction of the Court and the passing of any additional resolution necessary to implement the Scheme at the TPJF General Meeting.

The acquisition also requires the approval of Prospect Shareholders at the Prospect ASM being held on 28 June 2017 at 10.00 a.m. (Tokyo time).

Notices convening the Court Meeting for 10.00 a.m. on 19 July 2017 and the TPJF General Meeting for  10.15 a.m. on the same date (or as soon thereafter as the Court Meeting is concluded or adjourned), to be held at the offices of Herbert Smith Freehills LLP, Exchange House, Primrose Street, London EC2A 2EG, are set out in the Scheme Document. Forms of Proxy, for use at such Meetings, are enclosed with the Scheme Document.

If the Scheme is duly approved by voting Scheme Shareholders, the specified resolutions are approved by TPJF Shareholders, all other Conditions to the Offer are satisfied or (if capable of waiver) waived, the Court sanctions the Scheme and the Scheme becomes Effective in accordance with its terms, it is currently expected that trading on the London Stock Exchange's Main Market for listed securities of TPJF Shares will be suspended at 7.30 a.m. on 27 July 2017 and subsequently cancelled from listing and admission to trading at 8.00 a.m. on 28 July 2017.

It is important that, for the Court Meeting, as many votes as possible are cast so that the Court may be satisfied that there is a fair and reasonable representation of voting Scheme Shareholders' opinion. Voting Scheme Shareholders are therefore strongly urged to complete, sign and return the Forms of Proxy (once received) as soon as possible.

Capitalised terms in this announcement (the “Announcement”), unless otherwise defined herein, have the same meanings as set out in the Scheme Document.

Copies of this Announcement and the Scheme Document, together with information incorporated into it by reference to external sources, will be available free of charge (subject to certain restrictions relating to persons in certain overseas jurisdictions) on TPJF’s website at www.prospectjapanfund.com up to and including the Effective Date. The contents of this website are not incorporated into, and do not form part of, this Announcement.  

Timetable

The expected timetable of principal events for the implementation of the Scheme is set out below. If any of the key dates set out in the expected timetable changes, an announcement will be made through a Regulatory Information Service.
 

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

All references in this Announcement to times are to London time unless otherwise stated.

⁽¹⁾        It is requested that Pink Forms of Proxy for the Court Meeting be lodged not later than 48 hours prior to the time appointed for the Court Meeting (noting that in taking account of this 48 hour period, no account shall be taken of any part of a day that is not a working day). Pink Forms of Proxy not so lodged may be handed to the Registrar or the Chairman of the Court Meeting before the start of the Court Meeting.

⁽²⁾        Blue Forms of Proxy for the TPJF General Meeting must be lodged not later than 48 hours prior to the time appointed for the TPJF General Meeting (noting that in taking account of this 48 hour period, no account shall be taken of any part of a day that is not a working day). Blue Forms of Proxy not returned so as to be received by the time mentioned above and in accordance with the instructions on the Blue Form of Proxy will be invalid unless the Independent TPJF Directors direct otherwise.

⁽³⁾        Either the White Form A or the Green Form B (as appropriate) must be received by the Receiving Agent by 10.30 a.m. on 17 July 2017 (or, in the case of any change to the Scheme Voting Record Time, by no later than 10.30 a.m. on the date on which the revised Scheme Voting Record Time falls).

⁽⁴⁾        If either the Court Meeting or the TPJF General Meeting is adjourned, the Scheme Voting Record Time for the relevant adjourned meeting will be 6.00 p.m. on the day which is two days before the adjourned Meeting.

⁽⁵⁾        Or as soon thereafter as the Court Meeting shall have concluded or been adjourned.

⁽⁶⁾        These dates are indicative only and will depend, among other things, on the dates upon which Conditions are satisfied or (where permitted) waived or when the Court sanctions the Scheme (as appropriate). TPJF will announce any changes to these dates through a Regulatory Information Service.

⁽⁷⁾        This is the latest date by which the Scheme may become effective unless TPJF and Prospect agree (and, if required, the Panel and the Court permit) a later date.

Enquiries:

Important Notices

Stockdale Securities Limited, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for TPJF as financial adviser in connection with the Offer and other matters set out in this Announcement and for no one else and will not be responsible to anyone other than TPJF for providing the protections afforded to its clients or for providing advice in relation to the Offer and other matters set out in this Announcement. Neither Stockdale Securities Limited nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Stockdale Securities Limited in connection with this Announcement, any statement contained herein or otherwise.

Strand Hanson Limited, which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively for Prospect as joint financial adviser in connection with the Offer and other matters set out in this Announcement and for no one else and will not be responsible to anyone other than Prospect for providing the protections afforded to its clients or for providing advice in relation to the Offer and other matters set out in this Announcement. Neither Strand Hanson Limited nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Strand Hanson Limited in connection with this Announcement, any statement contained herein or otherwise.

Mizuho Bank, Ltd. (Corporate Advisory department), an investment banking arm of Mizuho Financial Group, which is regulated by the Japanese Financial Services Agency, is acting exclusively for Prospect as joint financial adviser in connection with the Offer and other matters set out in this Announcement and for no one else and will not be responsible to anyone other than Prospect for providing the protections afforded to its clients or for providing advice in relation to the Offer and other matters set out in this Announcement.  Neither Mizuho Bank, Ltd. (Corporate Advisory department) nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Mizuho Bank, Ltd. (Corporate Advisory department) in connection with this Announcement, any statement contained herein or otherwise.

Further information

This Announcement is for information purposes only and is not intended to, and does not, constitute or form part of any offer or invitation, or the solicitation of an offer, to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise nor will there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law.

The Offer is being made solely pursuant to the disclosures and information contained in the Scheme Document which, together with the Forms of Proxy, contains the full terms and conditions of the Offer, including details of how TPJF Shareholders may vote at the Meetings in respect of the Offer.

TPJF urges TPJF Shareholders to read the Scheme Document because it contains important information in relation to the Offer, the New Prospect Shares and the Combined Group. Any vote in respect of the Scheme or other response in relation to the Offer should be made only on the basis of the information contained in the Scheme Document.

This Announcement does not constitute a prospectus or prospectus equivalent document.

If you are in any doubt about the contents of this Announcement or the action you should take, you are recommended to seek your own independent financial advice immediately from your stockbroker, bank manager, solicitor, accountant or other independent financial adviser duly authorised under the Financial Services and Markets Act 2000 (as amended) if you are resident in the United Kingdom or, if not, from another appropriately authorised independent financial adviser.

Overseas jurisdictions

The release, publication or distribution of this Announcement in jurisdictions other than the UK and Guernsey may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK and Guernsey should inform themselves about, and observe any applicable requirements. In particular, the ability of persons who are not resident in the UK or Guernsey to participate in the Offer may be affected by the laws of the relevant jurisdictions in which they are located. This Announcement has been prepared for the purpose of complying with English law and Guernsey law and with the Code and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside the UK and Guernsey.

The Offer is subject to the applicable requirements of the Companies Law of Guernsey, the Court (as a result of TPJF being incorporated in Guernsey) and the GFSC (as a result of TPJF being an authorised closed-ended investment scheme in Guernsey and regulated under the POI Law and the Authorised Rules), with the applicable requirements of English law, the Code, the Panel, the London Stock Exchange and the FCA (as a result of TPJF being listed on the London Stock Exchange) and also with the applicable requirements of Japanese laws, JASDEC, the Tokyo Stock Exchange and the Japanese Financial Services Agency (as a result of Prospect being a Japanese company, listed on the Tokyo Stock Exchange).

The Offer may not be made directly or indirectly, in or into, or by the use of (electronic) mail or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of any Restricted Jurisdiction and no person may vote in favour of the Scheme by any such use, means, instrumentality or facilities. Accordingly, copies of this Announcement, the Scheme Document, the notices of the Court Meeting and the TPJF General Meeting, the Forms of Proxy, the Forms of Settlement and all other documents relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any Restricted Jurisdiction. All persons receiving this Announcement (including, without limitation, custodians, nominees and trustees) should observe these restrictions and any applicable legal or regulatory requirements of their jurisdiction and must not mail or otherwise forward, send or distribute this Announcement in, into or from any Restricted Jurisdiction.

The receipt of securities pursuant to the Offer by Overseas Shareholders may be a taxable transaction under applicable national, state and local, as well as foreign and other tax laws. Each Overseas Shareholder is urged to consult their independent professional adviser regarding the tax consequences of accepting the Offer.

Further details in relation to Overseas Shareholders is contained in the Scheme Document.

Additional information for US investors

These materials are not for distribution, directly or indirectly, in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia). These materials do not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States.

The New Prospect Shares have not been and will not be registered under the US Securities Act of 1933 (the “US Securities Act”) or under the securities laws of any State or other jurisdiction of the United States. Accordingly, the New Prospect Shares may not be offered, sold, resold, delivered, distributed or otherwise transferred, directly or indirectly, in or into the United States absent registration under the US Securities Act or an exemption therefrom. The New Prospect Shares issued pursuant to the Offer are expected to be issued in reliance upon the exemption from the registration requirements of the US Securities Act provided by Section 3(a)(10) thereof. There will be no public offer of New Prospect Shares in the United States.

TPJF is organised under the laws of Guernsey and Prospect is organised under the laws of Japan.  All of the officers and directors of TPJF are residents of countries other than the United States, and most of the officers and directors of Prospect are residents of countries other than the United States.  It may not be possible to sue TPJF and Prospect in a non-US court for violations of US securities laws.  It may be difficult to compel TPJF, Prospect and their respective affiliates to subject themselves to the jurisdiction and judgment of a US court.

The Offer, to be implemented by way of the Scheme, is being made to acquire the entire issued and to be issued share capital of a company incorporated in Guernsey by way of a scheme of arrangement provided for under Part VIII of the Companies Law of Guernsey. A transaction effected by way of a scheme of arrangement is not subject to the proxy solicitation or tender offer rules under the US Securities Exchange Act of 1934 (the “US Exchange Act”). Accordingly, the Scheme is subject to the disclosure requirements, rules and practices applicable in the UK and Guernsey to schemes of arrangement and takeover offers, which differ from the disclosure requirements, style and format of US tender offer and proxy solicitation rules. If Prospect determines to extend the offer into the US, the Offer will be made in compliance with applicable US laws and regulations. Financial information included in this Announcement and the Scheme Document has been or will have been prepared in accordance with non-US accounting standards that may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the US. However, if Prospect were to elect to implement the Offer by means of a contractual offer, rather than the Scheme, such offer will be made in compliance with all applicable laws and regulations, including Section 14(e) of the US Exchange Act and Regulation 14E thereunder. Such offer would be made in the US by Prospect and no one else.

Neither the US Securities and Exchange Commission nor any securities commission of any state of the United States has approved or disapproved the Offer, nor have such authorities passed upon or determined the fairness of the Offer or the adequacy or accuracy of the information contained in this Announcement. Any representation to the contrary is a criminal offence in the United States.

If the Offer is required to be made in the US, it will be done in compliance with the applicable tender offer rules under the US Exchange Act.

Forward-looking statements

This Announcement may contain certain forward-looking statements with respect to the financial condition, results of operations and business of Prospect and/or TPJF and certain plans and objectives of Prospect with respect thereto. These forward-looking statements can be identified by the fact that they do not relate to historical or current facts. Forward-looking statements also often use words such as “anticipate”, “target”, “expect”, “estimate”, “intend”, “plan”, “goal”, “believe”, “hope”, “aims”, “continue”, “will”, “may”, “should”, “would”, “could”, or other words of similar meaning. These statements are based on assumptions and assessments made by Prospect and/or TPJF (as applicable) in light of their experience and perception of historical trends, current conditions, future developments and other factors they believe appropriate. By their nature, forward-looking statements involve risk and uncertainty, because they relate to events and depend on circumstances that will occur in the future and the factors described in the context of such forward-looking statements in this Announcement could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to be correct and you are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this Announcement. Prospect does not assume any obligation to update or correct the information contained in this Announcement (whether as a result of new information, future events or otherwise), except as required by the Panel, the Code or by applicable law.

Forward-looking statements are not guarantees of future performance. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions. Many factors could cause actual results to differ materially from those projected or implied in any forward-looking statements. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this Announcement. Neither Prospect nor TPJF undertakes any obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except to the extent legally required.

There are several factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are changes in the global, political, economic, business and competitive environments, market and regulatory forces, future exchange and interest rates, changes in tax rates, and future business combinations or dispositions.

For a discussion of important factors which could cause actual results to differ from forward-looking statements in relation to the Prospect Group or the TPJF Group, refer to the annual report and accounts of the Prospect Group for the financial year ended 31 March 2016 and of the TPJF Group for the financial year ended 31 December 2016, respectively.

No profit forecasts, quantified financial benefit statements or estimates

No statement in this Announcement is intended, or is to be construed, as a profit forecast, profit estimate or quantified financial benefit statement for any period. No statement in this Announcement should be interpreted to mean that earnings per TPJF Share or earnings per Prospect Share for the current or future financial years would necessarily match or exceed the historical published earnings per TPJF Share or earnings per Prospect Share.

Dealing and Opening Position Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1 per cent. or more of any class of relevant securities of the offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person’s interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person’s interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of the offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel’s website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel’s Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Publication on website and availability of hard copies

This Announcement and the documents required to be published pursuant to Rule 26.1 of the Code will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on TPJF's website at www.prospectjapanfund.com by no later than 12.00 p.m. (London time) on the Business Day following this Announcement.

Neither the content of any website referred to in this Announcement nor the content of any website accessible from hyperlinks is incorporated into, or forms part of, this Announcement.

You may request a hard copy of this Announcement by contacting TPJF's company secretary, Northern Trust International Fund Administration Services (Guernsey) Limited, on +44 (0) 1481 745 918. You may also request that all future documents, announcements and information to be sent to you in relation to the Offer should be in hard copy form.

Electronic Communications

Please be aware that addresses, electronic addresses and certain other information provided by TPJF Shareholders, persons with information rights and other relevant persons for the receipt of communications from TPJF may be provided to Prospect during the Offer Period as required under Section 4 of Appendix 4 of the Code to comply with Rule 2.11(c) of the Code.

Time

All times shown in this Announcement are London times, unless otherwise stated.