Establishment Inv. Trust PLC (The) Update on continuation of the Company (9704V)
April 12 2019 - 2:00AM
UK Regulatory
TIDMET.
RNS Number : 9704V
Establishment Inv. Trust PLC (The)
12 April 2019
This announcement contains inside information
12 April 2019
The Establishment Investment Trust plc (the "Company" or
"EIT")
LEI: 213800I9IT25LOQ1UW49
Update on continuation of the Company
The board of the Company (the "Board") and investment manager
announced on 20 November 2018 that they will not recommend that
shareholders vote in favour of continuation of the Company in its
current form when the continuation vote is put forward at the next
Annual General Meeting and invited proposals to be submitted for
alternative plans for the Company's future.
The Board received a pleasing number of proposals and, following
a review of the options available, the Board today announces that
it intends to put forward proposals (the "Proposals") to put the
Company into voluntary liquidation and to offer shareholders the
option of electing for any or a combination of:
-- the default option of rolling some or all of their investment
into new shares at formula asset value ("FAV") to be issued by
Henderson International Income Trust plc ("HINT"), and/or
-- rolling some or all of their shares into shares to be issued
by VT Garraway Asian Centric Global Growth Fund; and/or
-- receiving cash at net asset value less costs.
Certain members of The Thornton family, and trustees of Thornton
family trusts, whose aggregate holdings amounting, in aggregate, to
7,581,964 ordinary shares in EIT, equivalent to 37.9 per cent. of
the Company's issued share capital, have indicated their support
for the Proposals.
HINT is a closed-ended investment trust that seeks to provide
shareholders with a growing total annual dividend, paid quarterly,
as well as capital appreciation. It is designed to help UK
investors diversify their equity income streams by investing in a
focused and internationally diversified portfolio of 50-80
companies outside the UK. HINT invests in undervalued companies
that are out of favour which pay investors a dividend income whilst
they wait for value to be realised. Ben Lofthouse is the lead fund
manager.
VT Garraway Asian Centric Global Growth Fund (the "Garraway
Fund") is a proposed new open-ended investment company which aims
to provide shareholders with capital growth and income over the
longer term. It will invest in a diversified global portfolio of
equities, combining both developed and emerging markets exposure;
along with the flexibility to invest in government bonds and
precious metal ETFs. A quarterly dividend will be paid. The fund
management team will be Malcolm Schembri, Tim Hall, Darran Goodwin
and Henry Thornton. Henry is presently at Blackfriars Asset
Management, the Company's outgoing investment manager and will be
joining Garraway Capital Management as a fund manager, responsible
for Asian equities.
Each of the Company, HINT and the Garraway Fund will bear its
own costs in respect of the Proposals save that EIT will cover the
cost of posting the HINT prospectus, and the particulars relating
to the Garraway Fund, to EIT shareholders. New shares in HINT to be
issued on a FAV for FAV basis (with FAV being the net asset value
per share (including current year income) as at the calculation
date less any costs in relation to the proposals not accrued). In
addition, HINT's manager will contribute 18 months of management
fees on the funds that roll over from EIT to HINT (the
"Contribution"). The Contribution will be used first to defray
HINT's costs with any balance being passed to EIT as a contribution
to its costs (for the benefit of the HINT rollover pool). The
Contribution will be calculated once the shareholder elections are
known and the portion which equates to HINT's costs will be
deducted from the next quarterly management fee invoice to HINT.
Any balance will then be paid to EIT.
The Board has signed heads of terms with the boards of both HINT
and the Garraway Fund. The Proposals have been agreed in principle
and will be effected by way of a scheme of reconstruction of EIT
under section 110 of the Insolvency Act 1986, resulting in the
voluntary liquidation of EIT and a tax efficient rollover of assets
of EIT into HINT or the Garraway Fund. The transaction would be
subject to, inter alia, regulatory consent and approval from
shareholders of EIT and HINT. EIT shareholders who do not make an
election will be deemed to have elected to receive their
entitlements in new shares to be issued by HINT. Neither the option
to roll into HINT nor into the Garraway Fund are subject to a
minimum rollover amount.
A circular convening a general meeting to seek approval for the
proposals is expected to be sent to EIT shareholders in due course.
In the meantime, further updates will be provided as
appropriate.
Enquiries:
Henry Willcocks / Robert Finlay 020 7601 6100
Shore Capital
Broker
Anthony Lee
PraxisIFM Fund Services (UK) Limited 020 7653 9690
Company Secretary
This information is provided by RNS, the news service of the
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contact rns@lseg.com or visit www.rns.com.
END
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