TIDMISH
RNS Number : 4936F
Ishaan Real Estate PLC
24 May 2013
Ishaan Real Estate Plc
("Ishaan Real Estate" or the "Company")
Notice of Extraordinary General Meeting
The Board of Ishaan Real Estate announces that it is today
posting a circular to Shareholders (the "Circular") outlining
proposals relating to the members' voluntary winding up of the
Company and the cancellation of admission of the Company's Ordinary
Shares to trading on AIM and convening an extraordinary general
meeting ("Extraordinary General Meeting") relating to the same. The
Extraordinary General Meeting will be held at Top Floor, 14 Athol
Street, Douglas, Isle of Man IM1 1JA, on 24 June 2013 at 12.00
pm.
The Circular will be made available on the Company's website
www.ishaanrealestate.com.
The expected timetable is set out in Appendix 1 to this
announcement.
Certain defined terms are set out in Appendix 2 to this
announcement.
Introduction
At an extraordinary general meeting of the Company held on 11
March 2013, Shareholders approved the Disposal and the amendment to
the Company's investment strategy as proposed by the Independent
Board Committee and more particularly described in the circular to
Shareholders dated 22 February 2013 (the "Disposal Circular"). The
Disposal was subsequently completed on 3 May 2013.
Following the completion of the Disposal, the Company's
operations effectively ceased and it became a cash shell. It is the
Directors' opinion that the best course of action is to now wind up
the Company and return its surplus cash to Shareholders. The
Independent Board Committee indicated in the Disposal Circular that
once the Disposal had been completed, the Board would convene an
extraordinary general meeting at which resolutions would be
proposed to voluntarily wind up the Company and to cancel the
Company's admission to trading on AIM.
Accordingly, Shareholders are now being asked to approve the
Winding Up Proposal which will enable the Directors to continue the
process of the members' voluntary winding up of the Company in
accordance with Part V of the Act (the "Winding Up"). Pursuant to
section 214 of the Act, the Directors are seeking this approval by
way of special resolution, which requires a majority of not less
than 75 per cent. of the votes cast by Shareholders attending and
voting at the Extraordinary General Meeting. Furthermore, in
accordance with the Act, Shareholder approval is also being sought
for the appointment of Michael Fayle of KPMG LLC to act as
liquidator in the members' voluntary winding up process.
The Directors consider that it is not in the best interests of
Shareholders that the Company continues to incur the costs
associated with maintaining the admission of Ordinary Shares to
trading on AIM while the Company completes a members' voluntary
winding up process. Accordingly, as part of the Winding Up
Proposal, Shareholders are being asked to approve the Cancellation,
which requires a majority of not less than 75 per cent. of votes
cast by Shareholders attending and voting at the Extraordinary
General Meeting.
Having completed the Disposal, the Board's aim is to reduce the
operating costs of the Group as much as is practicable so as to
maximise the Estimated Net Cash Resources in order to achieve the
expected Total Shareholder Distribution of approximately 51 pence
per Ordinary Share. If the Winding Up Proposal is not approved by
Shareholders, the expected Total Shareholder Distribution of
approximately 51 pence per Ordinary Share will not take effect and
instead the Board will need to consult with Shareholders as to the
future of the Company, which owns no property assets and is not
expected to generate any operational income. If the Resolution is
passed at the Extraordinary General Meeting, the Directors will
proceed with the Winding Up process.
The Disposal
Following the approval by Shareholders of the Disposal at the
extraordinary general meeting of the Company held on 11 March 2013,
the Disposal was subsequently completed on 3 May 2013. The
Investment Advisory Agreement automatically terminated on
completion of the Disposal.
Prior to completion of the Disposal, the Board was informed that
the Indian tax authorities had confirmed that withholding tax
equivalent to approximately GBP1.1 million was payable in respect
of the Disposal. As announced on 30 April 2013, the parties agreed
certain amendments to the Share Purchase Agreements to reflect that
the nil withholding tax certificate would not be obtained. An
initial agreement was reached on 29 April 2013 to dispose of the
Mauritian SPVs (except I-8 Company (Mauritius) Ltd) owned by the
Mauritian Holdco to Neerav or one of its affiliates. The Mauritian
Holdco and Neerav are in the process of negotiating a sale and
purchase agreement relating to the SPV Sale and it is anticipated
that the sale will be completed in July 2013, raising cash proceeds
of approximately GBP700,000, which, subject to the factors outlined
in section 8 of the Circular, will be available for distribution to
Shareholders as part of the Final Distribution.
In addition, the Board has approved the sale of the Brand by the
Company to Neerav Cyprus, an affiliate of Neerav and on 23 May 2013
Neerav Cyprus accepted a binding offer from the Company to acquire
the Brand. It is anticipated that the Brand Sale will be completed
by not later than 30 September 2013, raising cash proceeds of
GBP250,000, which, subject to the factors outlined in section 8 of
the Circular, will be available for distribution to Shareholders as
part of the Final Distribution. Neerav Cyprus confirmed that it
does not wish to purchase or seek registration of the Brand in any
jurisdiction outside the Territory.
Subject to completion of the SPV Sale and the Brand Sale, the
Company will be able to retain the proceeds of the sales as cash
available for subsequent distribution to Shareholders. Therefore,
as announced on 30 April 2013, the impact of the above on the
quantum of distributions to Shareholders is expected to be
limited.
Further details of the terms of the SPV Sale and the Brand Sale
are contained in the Circular.
Rationale for the Winding Up Proposal
Upon the completion of the Disposal, the Group's operations
effectively ceased and the Company became a cash shell. It is the
Directors' opinion that the best course of action is to now wind up
the Company and return its surplus cash to Shareholders.
The Directors' aim is to reduce the ongoing costs of the Group
as much as is practicable so as to maximise the Estimated Net Cash
Resources in order to achieve the expected Total Shareholder
Distribution of approximately 51 pence per Ordinary Share.
If the Winding Up Proposal is not approved by Shareholders, the
expected Total Shareholder Distribution of approximately 51 pence
per Ordinary Share will not take effect and instead the Board will
need to consult with Shareholders as to the future of the
Company.
Mechanics of the Winding Up
In order to initiate the Winding Up, separate statutory
declarations made by a majority of Directors of the Company are
required to the effect that they have made a full inquiry into the
affairs of the Company and, that having done so, they have formed
the opinion that the Company will be able to pay its debts in full
within a period not exceeding 12 months from the commencement of
the members' voluntary winding up. A majority of Directors made
such a statement of solvency on or about 22 May 2013.
Secondly, the Directors are calling an Extraordinary General
Meeting of the Company for 24 June 2013 to seek Shareholder
approval for the Winding Up in accordance with the Act. The
Resolution to approve the Winding Up requires a majority of not
less than 75 per cent. of the votes cast at the Extraordinary
General Meeting.
In accordance with the Act, Shareholder approval is also being
sought for the appointment of Michael Fayle, of KPMG LLC (the
"Liquidator"), to act as liquidator in the members' voluntary
winding up process. If appointed, the Liquidator, having set aside
sufficient assets in a liquidation fund to meet the Company's known
and contingent liabilities, will endeavour to ensure that an
Initial Distribution to Shareholders of the Company's cash assets
available for distribution on the members' voluntary winding up is
made as soon as possible. To the extent that any part of this
retention is not required to meet such liabilities, the balance
will be distributed in cash to Shareholders by the Liquidator at a
later date.
If the Winding Up Proposal is passed by the requisite majority,
the Directors will proceed with the Winding Up Proposal.
The Liquidator, if appointed by the Shareholders at the
Extraordinary General Meeting, will undertake the process of
payment of creditors and collection and distribution of the
Company's assets and, once this is complete, make up a final
account. He must then call a further general meeting of the Company
to lay the account before the Shareholders; and, within one week of
the final general meeting, send to the Registrar of Companies a
copy of the account together with a final return for registration.
On the expiration of three months from the date of registration of
the return, the Company is deemed to be dissolved.
It is expected that the Final Distribution will be made by July
2014 and that the Winding Up will be completed in 2014.
Further details of the proposed quantum and timing of the Total
Shareholder Distribution, the calculation of Estimated Net Cash
Resources and the factors affecting the timing and amount of the
Initial Distribution and the Final Distribution are contained in
the Circular.
Cancellation of admission to Trading on AIM
The Directors consider that it is not in the best interests of
Shareholders that the Company continues to incur the costs
associated with maintaining the admission of Ordinary Shares to
trading on AIM while the Company completes a members' voluntary
winding up process.
Under the AIM Rules, it is a requirement that the Cancellation
must be approved by not less than 75 per cent. of votes cast by
Shareholders at an extraordinary general meeting. Accordingly,
conditional on the passing of the Winding Up Proposal, a special
resolution will be proposed at the Extraordinary General Meeting to
approve the application to the London Stock Exchange for
Cancellation. If this resolution is approved with the requisite
majority, it is expected that cancellation of dealings will take
effect at 7.00 am on 25 June 2013.
In any event, under the Act, any transfer of shares, not being a
transfer made to or with the sanction of the Liquidator and any
alteration in the status of the Shareholders, made after the
approval of the Winding Up Proposal, would be void. As such,
Shareholders should be aware that trading in the Ordinary Shares on
AIM will be suspended from 7.00 am on 24 June 2013, in advance of
the Extraordinary General Meeting.
No provision will be made for trading in the Ordinary Shares
following Cancellation and the Ordinary Shares will not be
transferable once the Company enters liquidation.
Extraordinary General Meeting
At the Extraordinary General Meeting, the following special
resolution will be proposed:
(A) in accordance with the Act, the Directors be authorised to
proceed with the members' voluntary winding up of the Company and
to take such steps, including but not limited to the payment of
interim distributions and the appointment of the Liquidator, as
they in their absolute discretion deem necessary to effect the
members' voluntary winding up of the Company; and
(B) the admission of the Company's Ordinary Shares to trading on
AIM be cancelled in accordance with Rule 41 of the AIM Rules.
Recommendation
The Directors unanimously recommend that Shareholders vote in
favour of the Resolution as they themselves will be doing in
respect of their entire beneficial holdings of Ordinary Shares
amounting, in aggregate, to 2,184,448 Ordinary Shares, representing
approximately 1.50 per cent of the issued Ordinary Share capital of
the Company as at the date of this announcement.
Enquiries:
Deutsche Bank AG, London Branch (NOMAD and broker to the Company)
Ben Lawrence
John O'Driscoll
Tel: +44 20 7545 8000
Deutsche Bank AG is authorised under German Banking Law
(competent authority: BaFin - Federal Financial Supervising
Authority) and authorised and subject to limited by the Financial
Conduct Authority (the "FCA"). Details about the extent of Deutsche
Bank AG's authorisation and regulation by the FCA are available on
request.
Deutsche Bank AG is acting for the Company and no one else in
connection with the Disposal and will not be responsible to anyone
other than the Company for providing the protections afforded to
clients of Deutsche Bank nor for providing advice in connection
with the Disposal.
Appendix 1: Expected timetable of principal events
Latest time and date for receipt of 12.00 pm on 22 June 2013
the Form of Proxy for the Extraordinary
General Meeting of Ishaan Real Estate
plc
Suspension of trading in the Ordinary 7.00 am on 24 June 2013
Shares on AIM
Extraordinary General Meeting of Ishaan 12.00 pm on 24 June 2013
Real Estate plc
Expected date of commencement of members' 24 June 2013
voluntary winding up of the Company
Expected date of cancellation of admission 7.00 am on 25 June 2013
of the Ordinary Shares to trading on
AIM
Expected date of payment of the Initial by 31 July 2013
Distribution to Shareholders
Expected date of payment of the Final by July 2014
Distribution to Shareholders
All references to times are to London times unless otherwise
stated.
Appendix 2: Definitions
The following definitions apply throughout this announcement
unless the context otherwise requires:
"Act" the Companies Act 1931 (Isle of Man)
"AIM" the market of that name operated by
the London Stock Exchange
"AIM Rules" the AIM Rules for Companies published
by the London Stock Exchange from time
to time
"Board" or the "Directors" the directors or the board of directors,
as the case may be, of the Company from
time to time
"Brand" all rights, title and interest only
in and to the name "Ishaan" existing
as at 23 May 2013 in the Territory,
together with the goodwill and benefit
attached to the business in relation
to which the Brand is used or has been
used in the Territory, all logos, devices,
copyrights and designs associated with
the same and all rights, title, interest
and benefit in and to certain trade
mark registrations existing in the Territory
"Brand Sale" the proposed sale of the Brand to Neerav
Cyprus
"Cancellation" the proposed cancellation of the admission
of the Company's Ordinary Shares to
trading on AIM
"Company" or "Ishaan Ishaan Real Estate plc, a company incorporated
Real Estate" and registered in the Isle of Man with
registered number 117470C
"Deutsche Bank" Deutsche Bank AG, London Branch
"Disposal" the disposal of the Company's property
interests in the Indian Investment Vehicles,
as further detailed in the Disposal
Circular
"Disposal Circular" the circular to Shareholders dated 22
February 2013
"Estimated Net Cash Resources" the estimated net cash available to
the Company following the Disposal after
deducting all costs associated with
the Disposal and the Winding Up
"Extraordinary General the extraordinary general meeting of
Meeting" the Company to be convened for 12 pm
on 24 June 2013 to consider the Resolution
"Final Distribution" the proposed distribution as described
in Section 6 of the letter from the
Chairman of the Company in the Circular
"Financial Conduct Authority" Financial Conduct Authority of England
and Wales and its successors
"Form of Proxy" the form of proxy to accompany the Circular
for use at the Extraordinary General
Meeting
"Group" the Company and its subsidiary undertakings
from time to time
"Independent Board Committee" a committee of the Board comprising
all the Directors other than Neel Raheja
"Indian Investment Vehicles" the investment vehicles incorporated
in India in which the Group sold its
ordinary and preference shares (the
Disposal), as further detailed in the
Disposal Circular
"Initial Distribution" the proposed distribution as described
in Section 6 of the letter from the
Chairman of the Company in the Circular
"Ishaan Real Estate" see "Company"
"Investment Advisory the investment advisory agreement between
Agreement" the Mauritian Holdco and Neerav dated
6 November 2006, as amended
"Liquidator" Michael Fayle, of KPMG LLC
"London Stock Exchange" London Stock Exchange plc
"Mauritian Holdco" I Holding Company (Mauritius) Ltd
"Mauritian SPVs" the wholly owned subsidiaries of Mauritian
Holdco, which are as follows: I-1 Company
(Mauritius) Limited; I-2 Company (Mauritius)
Limited; I-4 Company (Mauritius) Limited;
I-6 Company (Mauritius) Limited; and
I-7 Company (Mauritius) Limited
"Neerav" Neerav Investment Advisory Services
(Dubai) Limited, the former investment
adviser to the Company, of which Neel
Raheja is a director
"Neerav Cyprus" Neerav Investment Advisory Services
(Cyprus) Private Limited
"Notice" the notice of the Extraordinary General
Meeting to be set out at the end of
the Circular
"Ordinary Shares" ordinary shares of GBP0.01 each in the
capital of the Company
"Resolution" the resolution to be proposed to Shareholders
at the Extraordinary General Meeting
"Share Purchase Agreements" the five share purchase agreements dated
21 February 2013 in relation to the
Disposal, as further detailed in the
Disposal Circular
"Shareholder" a registered holder of Ordinary Shares
"SPV Sale" the proposed sale of the Mauritian SPVs,
except I-8 Company (Mauritius) Ltd,
to Neerav or its nominee
"Territory" the United Kingdom, Hong Kong, Singapore
and the United Arab Emirates
"Total Shareholder Distribution" the Initial Distribution together with
the Final Distribution
"United Kingdom" or "UK" the United Kingdom of Great Britain
and Northern Ireland
"Winding Up" the members' voluntary winding up of
the Company
"Winding Up Proposal" the proposal to continue the Winding
Up and the proposal for the Cancellation
"GBP" or "GBP" or "Sterling" the lawful currency of the UK and the
or "pence" Isle of Man
This information is provided by RNS
The company news service from the London Stock Exchange
END
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