Tender Offer
December 15 2009 - 10:23AM
UK Regulatory
TIDMPACL
15 December 2009
Pacific Alliance China Land Limited
Tender Offer
Pacific Alliance China Land Limited ("PACL" or the "Company"), the
closed-end investment company admitted to trading on AIM and focused
on investing in a portfolio of investments in existing properties,
new developments, distressed projects and real estate companies in
Greater China, today announces that a circular has been sent to
shareholders detailing a tender offer (the "Tender Offer") closing 14
January 2010 to purchase up to 6 per cent of the Ordinary Shares of
the Company at a price equal to the unaudited Net Asset Value as at
30 November 2009.
Background
At its launch in November 2007, the Company's Admission Document
indicated that PACL would provide a regular level of income in the
form of a dividend up to an annual yield of 6 per cent of Net Asset
Value. At an extraordinary general meeting held on 2 March 2009 (the
"2009 EGM"), a special resolution was passed authorising the Company
to increase this annual yield to 12 per cent. of Net Asset Value.
The Tender Offer
After consultation with the Company's major Shareholders following
the 2009 EGM, the Board and the Investment Manager concluded that it
would be more tax efficient, and therefore in the best interests of
the Shareholders, that distributions be made by way of a tender offer
instead of a dividend.
Accordingly, having made one such distribution in July 2009, the
Company will again use its wholly-owned subsidiary, PACL Trading
Limited (the "Share Purchase Subsidiary"), to implement a tender
offer whereby Shareholders can tender up to 6 per cent. of their
Ordinary Shares at USD 1.12 per Ordinary Share, being the price equal
to the unaudited Net Asset Value per Ordinary Share as at 30 November
2009 (the "Tender Price"). The Tender Offer will be open and
available to all Shareholders as of the Record Date of 8 January
2010.
Depending on individual financial and tax circumstances and
investment objectives, Shareholders that wish to remain investors in
the Company may be able to book a gain by participating in the Tender
Offer by using the proceeds received upon Settlement to repurchase
Ordinary Shares in the market at a discount to the Tender Price.
The timetable for the Tender Offer is as follows:
Tender Offer Record Date 8 January 2010
Latest time and date for receipt of 12.00 midnight (UK time) on 14
Tender Forms January 2010
Tender Offer Results announcement 15 January 2010
Tender Offer Settlement Date 22 January 2010
The Circular sent to Shareholders today contains the formal terms of
the Tender Offer, together with details of how Shareholders can
tender their Ordinary Shares for purchase, if they wish to do so. A
copy is also available on the Company's website www.pacl-fund.com.
The extent to which Shareholders participate in the Tender Offer is a
matter for each Shareholder to decide, and will be influenced by
their own individual financial and tax circumstances and their
investment objectives. The Directors are not tendering any of the
Ordinary Shares in which they are interested.
For further information please contact:
MANAGER: LEGAL COUNSEL:
Chris Gradel, Managing Partner Jon Lewis, General Counsel
Pacific Alliance Group Pacific Alliance Group
16/F, St. John's Building 16/F St. John's Building
33 Garden Road 33 Garden Road
Central, Hong Kong Central, Hong Kong
Tel: (852) 29180088 Tel: (852) 29180088
Fax: (852) 29180881 Fax: (852) 29180881
cgradel@pacific-alliance.com jlewis@pacific-alliance.com
BROKER: NOMINATED ADVISER:
Hiroshi Funaki Philip Secrett
LCF Edmond de Rothschild Securities Grant Thornton Corporate Finance
Tel: (44) 20 7845 5960 Tel: (44) 20 7383 5100
Fax: (44) 20 7845 5961 Philip.J.Secrett@gtuk.com
funds@lcfr.co.uk
MEDIA RELATIONS:
Sophie Hoggarth
Pacific Alliance Group
Tel: (86) 21 61135818
shoggarth@pacific-alliance.com
Financial Dynamics, London
Andrew Walton/David Cranmer
Tel: (44) 207 269 7217
Financial Dynamics, Asia
Alastair Hetherington/Christine Wood
Tel: (852) 3716 9800
Notes to Editors:
Pacific Alliance China Land Limited (AIM: PACL) is a closed-end
investment company with net assets of USD 171.5 million at 30
November 2009. PACL was admitted to trading on the AIM Market of the
London Stock Exchange in November 2007. PACL is focused on investing
in a portfolio of existing properties, new developments, distressed
projects and real estate companies in Greater China.
For more information about PACL, please visit: www.pacl-fund.com
Pacific Alliance China Land is a member of Pacific Alliance Group,
the Asian alternative investment fund management group.
For more information about Pacific Alliance Group, please visit:
www.pacific-alliance.com.
Background to and key features of the Tender Offer
The key features of the Tender Offer are as follows:
· the Tender Offer is for up to 6 per cent. of
the Company's Ordinary Shares;
· Shareholders can decide whether or not to
tender Ordinary Shares up to their Entitlement (being 6 per cent. of
their respective holdings on the Record Date); and
· the Tender Price will be USD 1.12 per Ordinary
Share (being the unaudited Net Asset Value per Ordinary Share as at
30 November 2009).
The Tender Offer is conditional, inter alia, on the Company not
terminating the Tender Offer in accordance with paragraph 7 of Part 2
of the Circular.
Options for Shareholders
Shareholders can choose to:
· not tender any of their Ordinary Shares; or
· tender such number of their Ordinary Shares up
to their Entitlement for purchase and to receive a cash payment as
consideration for such purchase.
Shareholders may tender up to a maximum of 6 per cent. of their
respective holdings under the Tender Offer only. There is no cash
dividend alternative available to Shareholders in connection with
this 6 per cent. distribution.
Further details of the Tender Offer
Record Date Shareholders are invited to tender their Entitlement of
Ordinary Shares to the Share Purchase Subsidiary.
The Share Purchase Subsidiary will purchase validly tendered Ordinary
Shares at the Tender Price and will hold such Ordinary Shares to
replicate a treasury facility. The Company believes a treasury
facility could provide useful benefits to the Company and the
Shareholders by serving, for example, as a future source of
additional liquidity or as consideration when acquiring future
portfolio investments. The Company may not hold Ordinary Shares
directly because the laws of the Cayman Islands, where the Company is
domiciled, currently preclude the direct holding of treasury shares
by a Cayman Island company (accordingly, such purchased shares would
be immediately cancelled). The Share Purchase Subsidiary is the same
entity that was announced by the Company on 24 June 2008 to
effectively replicate the benefits of a treasury facility in
connection with its share buyback program. Further details of the
Company's policies regarding its treasury facility are provided in
paragraph 8 of Part 1 of the Circular.
Shareholders' attention is drawn to Part 2 of the Circular which,
together with the Tender Form, constitutes the terms and conditions
of the Tender Offer. Details of how Shareholders tender Ordinary
Shares can be found at paragraph 3 of Part 2 of the Circular.
Shareholders should note that, once tendered, such Ordinary Shares
may not be sold, transferred, withdrawn from the Tender Offer,
charged or otherwise disposed of other than in accordance with the
Tender Offer. Shareholders who are in doubt as to the contents of
the Circular or as to the action to be taken should immediately
consult their financial adviser.
Expenses
The costs relating to the Tender Offer will be paid by the Company
and are expected to be approximately USD 10,000. Shareholders should
note this expense will reduce the Net Asset Value per Ordinary Share
accordingly.
Overseas Shareholders
The Tender Offer is being made to all Shareholders on the Company's
Register of Members (or, where Ordinary Shares are held in Euroclear
and/or Clearstream, otherwise beneficially entitled to such Ordinary
Shares) on the Record Date. However, it is the responsibility of all
Overseas Shareholders to satisfy themselves as to the observance of
all legal requirements in their jurisdiction, including, without
limitation, all relevant requirements in relation to the ability of
such holders to participate in the Tender Offer. Further details
relating to Overseas Shareholders can be found at paragraph 9 of Part
2 of the Circular.
Taxation
Shareholders who sell Ordinary Shares in the Tender Offer may,
depending on their individual circumstances, incur a tax liability.
Shareholders who are in doubt as to their tax position should consult
an appropriate professional financial adviser.
Applicable terms of the company's share purchase policy
The following terms will apply to the purchase of the Ordinary Shares
by the Share Purchase Subsidiary in the Tender Offer:
· The purchases will be funded by way of an
intra-group loan from the Company.
· The maximum number of the Ordinary Shares that
may be purchased in any 12 month period is 25 per cent. of the
Company's issued share capital, from time to time.
· If possible, all sales shall be made at a
premium to the last announced Net Asset Value per Ordinary Share, and
sales at a discount to the prevailing Net Asset Value per Ordinary
Share may only be made with the prior approval of the Board.
· The Share Purchase Subsidiary must dispose of
all Ordinary Shares held before the Company can raise additional
funds through the offer and sale of new Ordinary Shares.
· The maximum number of Ordinary Shares that can
be sold by the Share Purchase Subsidiary in any 12 month period is 25
per cent. of the Company's issued share capital, from time to time.
This limit can be exceeded only with the prior express approval of
the Board.
· The Share Purchase Subsidiary is prohibited
from purchasing or selling Ordinary Shares during 'close periods' (as
described in the AIM Rules for Companies).
· The Share Purchase Subsidiary shall not
exercise the voting rights attaching to Ordinary Shares held by it,
from time to time.
· The Share Purchase Subsidiary shall waive the
right to receive all dividends or other distributions in relation to
Ordinary Shares held by it, from time to time.
· The Company will promptly announce to the
market all purchases and sales of all Ordinary Shares by the Share
Purchase Subsidiary without delay.
Shareholders should note that, apart from an increase in the maximum
number of Ordinary Shares that may be purchased or sold in any 12
month period, the share purchase policies announced on 24 June 2008
will continue to apply to all future market purchases of Ordinary
Shares by the Share Purchase Subsidiary.
Action to be Taken
Shareholders who do not wish to participate in the Tender Offer
should take no action. There is no cash dividend alternative
available to Shareholders in connection with this 6 per cent.
distribution.
The procedure for tendering Ordinary Shares depends on whether
Ordinary Shares are held in uncertificated or certificated form, and
is summarised below:
Ordinary Shares held in certificated form (that is not held though
Euroclear and/or Clearstream)
The Tender Form should be completed, signed and returned as described
above so as to be received by the Registrar, together with relevant
certificates evidencing any such Ordinary Shares and other documents
of title, not later than 12.00 midnight (UK time) on 14 January 2010.
Ordinary Shares held in uncertificated form through Euroclear and/or
Clearstream
Euroclear
Shareholders who hold their Ordinary Shares through Euroclear will be
notified of the terms of the Tender Offer by Euroclear Bank S.A. as
system administrator and should remit their instructions to Euroclear
Bank S.A. in the notified manner. The acceptances from Shareholders
of Ordinary Shares in Euroclear shall constitute irrevocable
instructions to Euroclear Bank S.A. to block any attempt to transfer
the Ordinary Shares tendered, so that on or prior to the Settlement
Date no transfer of such Ordinary Shares may be effected (other than
to the Share Purchase Subsidiary) or the date on which the Tender
Offer has been declared unconditional and the Ordinary Shares have
been accepted for purchase) and to debit the securities account in
which such Ordinary Shares are held on the Settlement Date in respect
of the Ordinary Shares tendered and accepted for purchase by the
Company, against payment by the Company of the Tender Price in
accordance with the terms of the Tender Offer.
Clearstream
Shareholders who hold their Ordinary Shares through Clearstream will
be notified of the terms of the Tender Offer by Clearstream Banking
S.A. as system administrator and should remit their instructions to
Clearstream Banking S.A. in the notified manner. The acceptances from
Shareholders of Ordinary Shares in Clearstream shall constitute
irrevocable instructions to Clearstream Banking S.A. to block any
attempt to transfer the Ordinary Shares tendered, so that on or prior
to the Settlement Date no transfer of such Ordinary Shares may be
effected (other than to the Share Purchase Subsidiary) or the date on
which the Tender Offer has been declared unconditional and the
Ordinary Shares have been accepted for purchase) and to debit the
securities account in which such Ordinary Shares are held on the
Settlement Date in respect of the Ordinary Shares tendered and
accepted for purchase by the Company, against payment by the Company
of the Tender Price in accordance with the terms of the Tender Offer.
DEFINITIONS
The following definitions apply throughout this announcement unless
the context otherwise requires:
"Admission Document" the Company's AIM admission document
dated 20 November 2007;
"AIM" the market of that name operated by the
London Stock Exchange;
"Board" or "Directors" the directors of the Company;
"Business Day" any day other than a Saturday, Sunday or
public holiday in London, Jersey and Hong
Kong;
"certificated" or "in not in uncertificated form;
certificated form"
"Circular" the circular dated 15 December 2009 sent
to Shareholders in relation to the Tender
Offer;
"Clearstream" the system of paperless settlement of
trades and the holdings of shares without
share certificates administered by
Clearstream Banking SA;
"Company" Pacific Alliance China Land Limited;
"Entitlement" the entitlement of each Shareholder to
tender up to 6 per cent. of the Ordinary
Shares registered in each Shareholder's
name on the Record Date (or, where
Ordinary Shares are held in Euroclear
and/or Clearstream, the entitlement of
each person otherwise beneficially
entitled to such Ordinary Shares on the
Record Date to tender up to 6 per cent.
of Ordinary Shares so beneficially
entitled) rounded down to the nearest
whole number;
"Euroclear" the system of paperless settlement of
trades and the holding of shares without
share certificates administered by
Euroclear Bank SA;
"Investment Manager" Pacific Alliance Real Estate Limited;
"London Stock Exchange" London Stock Exchange plc;
"Net Asset Value" the total value of all of the assets of
the Company less its liabilities as
determined by the Board and calculated in
accordance with the Company's accounting
policies;
"Net Asset Value per the Net Asset Value divided by the number
Ordinary Share" of Ordinary Shares then outstanding;
"Ordinary Shares" ordinary shares of USD 0.01 each in the
capital of the Company;
"Overseas Shareholders" Shareholders who are resident in, or
citizens of, territories outside the
United Kingdom;
"Record Date" 8 January 2010;
"Record Date Shareholders" Shareholders on the Register of Members
on the Record Date;
"Register of Members" the Company's register of Shareholders;
"Registrar" Sanne Trust Company Limited;
"Settlement Date" 22 January 2010, the date on which the
Share Purchase Subsidiary will formally
purchase Ordinary Shares validly tendered
and accepted pursuant to the Tender Offer
in accordance with the terms and
conditions of the Tender Offer;
"Shareholders" holders of Ordinary Shares (or, where
Ordinary Shares are held in Euroclear
and/or Clearstream, the persons otherwise
beneficially entitled to such Ordinary
Shares);
"Share Purchase Subsidiary" PACL Trading Limited;
"Tender Form" the tender form for use in connection
with the Tender Offer and which
accompanies the Circular;
"Tender Offer Costs" the costs of preparing and implementing
the Tender Offer which are estimated to
be approximately USD 10,000;
"Tender Price" USD 1.12, being the price at which
Ordinary Shares will be purchased
pursuant to the Tender Offer which is
equal to the unaudited Net Asset Value
per Ordinary Share as at 30 November 2009
rounded down to the nearest whole US
cent;
"uncertificated" or an Ordinary Share recorded on the
"in uncertificated form" Register as being held in Euroclear or
Clearstream by the relevant nominee on
behalf of a Shareholder and the
beneficial title to which may be
transferred by means of Euroclear or
Clearstream (as appropriate);
"United Kingdom" or the United Kingdom of Great Britain; and
"UK"
"USD" United States dollars, the legal currency
of the United States.
=--END OF MESSAGE---
This announcement was originally distributed by Hugin. The issuer is
solely responsible for the content of this announcement.
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