ScotGems Plc Publication of Circular

 
TIDMSGEM 
 
ScotGems plc 
LEI Number: 549300GQHCPU9P1NYM13 
18 August 2022 
 
 
Publication of Circular 
Further to the announcement of 1 July 2022, the Board of ScotGems plc (the 
"Company") announces that the Company will shortly publish a circular (the 
"Circular") to the Company's shareholders ("Shareholders") setting out 
recommended proposals for a members' voluntary liquidation of the Company 
(the "Proposals"). If the Proposals become effective they will, subject to 
the terms and conditions set out in the Circular, provide all Shareholders 
with a full cash exit less costs. 
 
Background to the Proposals 
 
On 9 March 2022 the Board of the Company announced that it had received 
notice to terminate the alternative investment fund management agreement 
dated 2 June 2017 (the "AIFM Agreement") from First Sentier Investors (UK) 
Funds Limited, the Company's AIFM (the "AIFM"). The termination of the AIFM 
Agreement is subject to a six month notice period and the investment 
management agreement among the Company, the AIFM and First Sentier 
Investors International IM Limited (the "Investment Manager") will 
terminate automatically at the same time as the AIFM Agreement. 
 
In the light of this development, the Board carefully considered the 
options for the future of the Company including the review of a number of 
proposals made to the Board and consultation with the Company's largest 
Shareholders. Throughout this process the Board took into account the size 
of the Company, the discount at which the Company's shares (the "Shares") 
trade relative to net asset value and the limited liquidity in the Shares. 
 
The Board wanted to ensure that all Shareholders had an opportunity to 
consider the Company's future. Accordingly, it was announced on 12 May 2022 
that the Company would convene a general meeting for Shareholders to vote 
on the continuation of the Company and that the Board, following further 
consideration of the Company's options (including a straightforward winding 
up), would give its recommendation on the future of the Company prior to 
the continuation vote. 
 
As announced on 1 July 2022, following further consultation with major 
Shareholders and the Company's advisers, the Board has determined that it 
would be in the best interests of the Company and Shareholders as a whole 
to put forward formal proposals to Shareholders for a members' voluntary 
liquidation of the Company. Accordingly, the Board is proposing that the 
Company be wound up such that Shareholders are provided with a full cash 
exit less costs. 
 
Update on Portfolio Realisation 
 
As set out in the announcements of 1 and 13 July 2022, the Board has 
instructed the Investment Manager to realise the Company's investment 
portfolio (the "Portfolio") in an orderly manner. As at 17 August 2022 
(being the latest practicable date prior to the publication of this 
announcement) the Investment Manager has realised approximately 97.51 per 
cent. of the Portfolio, with the vast majority of the proceeds of these 
sales being held in Sterling, and expects to have realised approximately 
98.35 per cent. of the Portfolio by the date of the General Meeting. 
 
Given the progress made to date in realising the Portfolio, the Board 
believes that it is now appropriate to move forward with the Proposals. 
 
The Proposals 
 
The Board is proposing that the Company be placed into members' voluntary 
liquidation, which requires the approval of Shareholders at a General 
Meeting that will be convened pursuant to the Notice of General Meeting set 
out at the end of the Circular. 
 
The General Meeting will be held on 8 September 2022 at 11.30 a.m. 
 
The resolution to be considered at the General Meeting relates, first, to 
the approval of the Company being wound up voluntarily and the appointment 
of the Liquidators for the purpose of the winding up. It grants the 
Liquidators authority to make distributions in cash to the Shareholders 
(after payment of the Company's liabilities and after deducting the costs 
of implementation of the Company's winding up) in proportion to their 
holdings of Shares in accordance with the provisions of the Articles. It 
also grants the Liquidators authority to exercise certain powers laid down 
in the Insolvency Act 1986 and determines the remuneration of the 
Liquidators by reference to the time spent attending to matters. 
 
If appointed, the Liquidators will, with effect from 8 September 2022, 
assume responsibility for the winding up of the Company, including the 
realisation of the remaining assets of the Company; the payment of fees, 
costs and expenses; the discharging of the liabilities of the Company; and 
the distribution of its surplus assets to Shareholders. 
Distributions to Shareholders 
 
The Liquidators will distribute the proceeds of the realisation of the 
Portfolio to Shareholders after the Company's outstanding liabilities and 
the costs of implementing the Proposals, including the Liquidators' fees, 
have been met. Cash held by the Company will be distributed amongst 
Shareholders, as set out below, through one or more distributions in 
accordance with the provisions of the Articles. 
Assuming the Resolution is passed, the Liquidators expect to make an 
initial distribution of the cash proceeds of the liquidation of the 
Portfolio, less the costs of the Proposals and the amount attributable to 
the Liquidation Fund, by 23 September 2022 (the "Initial Distribution"). 
 
Once the Liquidators have realised the Company's assets, made the Initial 
Distribution, satisfied the claims of creditors of the Company and paid the 
costs and expenses of the liquidation, it is expected that the Liquidators 
will make a final distribution to Shareholders. This final distribution, if 
any, will be made solely at the discretion of the Liquidators. There can be 
no guarantee as to the value, if any, and/or timing of distribution(s) that 
may result from the realisation of the Company's remaining assets.  Both of 
these factors depend, inter alia, on prevailing market conditions and legal 
restrictions. 
All Shareholders on the Register of Members at 6.00 p.m. on 7 September 
2022 (who are not Sanctions Restricted Persons) will be entitled to the 
distribution(s) from the Liquidators, including the Initial Distribution. 
 
As announced today, in order to comply with the Company's obligations in 
respect of its investment trust status for the period between 1 January 
2022 and 8 September 2022, a pre-liquidation Interim Dividend of 3 pence 
per Share will also be to Shareholders prior to the General Meeting. 
 
Expected Timetable 
 
Notice of General Meeting                                    18 August 2022 
 
Ex-dividend date for the Interim                             25 August 2022 
Dividend 
 
Record date for the Interim Dividend                         26 August 2022 
 
Last day of dealing in the Shares                          5 September 2022 
through CREST on a normal rolling two 
day settlement basis 
 
Deadline for receipt of Forms of             11.30 a.m. on 6 September 2022 
Proxy 
 
Payment date for the Interim Dividend                      7 September 2022 
 
Close of Register and Record Date for         6.00 p.m. on 7 September 2022 
participation in the members' 
voluntary liquidation 
 
Suspension of Shares from listing on          7.30 a.m. on 8 September 2022 
the Of?cial List and from trading on 
the London Stock Exchange 
 
General Meeting                              11.30 a.m. on 8 September 2022 
 
Appointment of Liquidators                                 8 September 2022 
 
Expected date of cancellation of the          8.00 a.m. on 9 September 2022 
listing of the Shares on the Of?cial 
List and of the trading of the Shares 
on the London Stock Exchange 
 
First cash distribution to                             by 23 September 2022 
Shareholders* 
 
* Actual date to be determined by the Liquidators. 
The above times and/or dates may be subject to change and, in the event of 
such change, the revised times and/or dates will be noti?ed to Shareholders 
by an announcement through a Regulatory Information Service. 
All references to times in this announcement are to London times. 
 
 
General 
 
A copy of the Circular will be submitted to the Financial Conduct Authority 
and will be available for inspection at the National Storage Mechanism 
which is located at data.fca.org.uk/#/nsm/nationalstoragemechanism and on 
the Company's website at www.scotgems.com. 
Dickson Minto W.S. is authorised and regulated by the Financial Conduct 
Authority. Dickson Minto W.S. will not be responsible to anyone other than 
the Company for providing protections afforded to clients of Dickson Minto 
W.S. or for affording advice in relation to the contents of this 
announcement, the Circular or any matters referred to therein or any other 
statement made or purported to be made by Dickson Minto W.S. or on its 
behalf in connection with the Company, the Proposals, the Resolution or the 
Shares. Accordingly, Dickson Minto W.S., to the fullest extent permissible 
by law, disclaims all and any responsibility or liability (save for any 
statutory liability including any responsibilities or liabilities which may 
arise under FSMA or any regulatory regime established thereunder) whether 
arising in tort, contract or otherwise which it might otherwise have in 
respect of this announcement, the Circular or any other statement. 
 
Enquiries 
Juniper Partners Limited (Secretary)                    0131 378 0500 
Douglas Armstrong 
Dickson Minto (Sponsor)                                        020 7649 
6823 
 
 
 
END
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