DJ Rights and Issues Investment Trust PLC: Tender Offer
Rights and Issues Investment Trust PLC (RIII) Rights and Issues Investment Trust PLC: Tender Offer 30-Aug-2022 / 07:00 GMT/BST Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.
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RIGHTS AND ISSUES INVESTMENT TRUST PLC (the "Company")
Tender Offer
The Company announces that it is proposing to conduct a tender for up to 10% of the Company's issued share capital. A circular setting out the terms of the tender and convening the necessary General Meeting is being posted to Shareholders.
The expected timetable of principal events along with key information from the Circular is summarised below:
EXPECTED TIMETABLE
2022
Tender Offer Record Date
6:00 p.m. on 26 August
Tender Offer opens
2 September
Latest time and date for receipt of Forms of Proxy for the General Meeting 11:30 a.m. on 22
September
Last time and date for receipt of Tender Form and TTE Instruction(s) in CREST and Tender Closing
Date 1:00 p.m. on 23
September
Time and date of General Meeting 11:30 a.m. on 26
September
Result of General Meeting expected to be announced
26 September
6:00 p.m. on 26
Calculation Date September
Announcement of results of the Tender Offer and the Tender Price
27 September
Payment under the Tender Offer announced: Cheques dispatched and payments made through CREST in
the week commencing 10 October
The times and dates set out in the expected timetable and mentioned throughout this document may, in certain circumstances, be adjusted by the Company, in which event, details of the new times and dates will be notified, as required, to the London Stock Exchange and, where appropriate, to Shareholders and an announcement will be made through a Regulatory Information Service.
All references to times in this document are to London time unless otherwise stated.
The Circular containing a notice of general meeting, together with forms of proxy and Tender Forms, is expected be dispatched to all Shareholders on 1 September 2022 and to be available from that date on the Company's website:
www.maitlandgroup.com/investment-trusts/rights-and-issues-investment-trust-plc/.
Enquiries:
David Bramwell, Chairman +44 (0) 20 7220 0500
Simon Knott, Executive Director +44 (0) 20 7220 0500
finnCap Limited
William Marle / George Dollemore - Corporate Finance +44 (0) 20 7220 0500
Mark Whitfeld / Pauline Tribe - Sales +44 (0) 20 7220 0500
Maitland Administration Services Limited
+44 (0) 1245 398950
cosec@maitlandgroup.com
BACKGROUND
The Company announced on 7 June 2022 that Simon Knott, a director of the Company, intends to retire as investment manager of the Company. With the help of external consultants, the Board has carried out a thorough review of potential investment managers to succeed Simon and on 7 June 2022 announced that, following this review, it intends to appoint Jupiter Unit Trust Managers ("JUTM") as the AIFM of the Company which will, upon its appointment, delegate investment management to Jupiter Asset Management Limited as the Company's new investment manager. Simon's resignation as investment manager and JUTM's appointment are expected to take effect from 3 October 2022.
The Board would like to express its gratitude to Simon Knott for his 39 years of service as the Company's investment manager. Simon has produced outstanding returns for shareholders over the period of his tenure, with the Net Asset Value per share of the Company increasing 10,371 per cent.[*], compared with a return of the FTSE All-share Index of 610 per cent. The Board is very pleased that Simon will remain a non-executive director of the Company following his retirement as investment manager. At the same time, the Board looks forward to working with the JUTM team. JUTM's UK small and mid-cap equity team has a formidable reputation as a deeply resourced and top-performing investment team.
The Company also announced on 7 June 2022 that the Company would make a tender offer (the "Tender Offer") to Shareholders equal to ten per cent. of the issued share capital of the Company at a price per Ordinary Share equal to 96 per cent. of the Net Asset Value per Ordinary Share prevailing on the Calculation Date (the "Tender Price"). Repurchases to be made in respect of the Tender Offer require the approval of Shareholders by special resolution.
The Board has convened a General Meeting for 26 September 2022 to approve the Tender Offer so as to permit those Qualifying Shareholders who wish to realise some or all of their investment in the Company to do so, subject to the terms and conditions of the Tender Offer and the extent to which the Qualifying Shareholders tender their Ordinary Shares.
THE TENDER OFFER
The Board has arranged for finnCap to conduct the Tender Offer for up to 10 per cent. of the issued share capital of the Company at the Tender Price. finnCap acting as principal, will pay the Tender Price in cash. Further details of the Tender Offer are set out in the Circular expected to be published on 1 September 2022.
The Tender Offer enables Qualifying Shareholders who wish to realise some or all of their Ordinary Shares to elect to do so (subject to the overall limits applicable to the Tender Offer). The Tender Offer is being made for up to 10 per cent. of the Company's issued share capital as at the Latest Practicable Date and each Qualifying Shareholder is entitled to tender a percentage of their holding equal to (or less than, if they so choose) the Basic Entitlement. The maximum number of Ordinary Shares to be acquired under the Tender Offer is 706,904 Ordinary Shares, representing 10 per cent. of the Ordinary Shares in issue as at the Latest Practicable Date.
By way of example, the Basic Entitlement of a Qualifying Shareholder holding 100 Ordinary Shares would be 10 Ordinary Shares. Qualifying Shareholders tendering up to their Basic Entitlement will have their tender satisfied in full. Qualifying Shareholders will also be entitled to apply to tender Ordinary Shares above their Basic Entitlement, which may be satisfied on a pro rata basis to the extent that other Qualifying Shareholders do not tender up to their respective Basic Entitlements as set out in further detail below.
Assuming that the 10 per cent. of Ordinary Shares as at the Latest Practicable Date were acquired under the Tender Offer at 2,292.36p per Ordinary Share, being 96 per cent. of the prevailing Net Asset Value per Ordinary Share of the Company as at the Latest Practicable Date, the purchase of Ordinary Shares under the Tender Offer would, on a before cost basis, result in an uplift in NAV of 10.61p per Ordinary Share for Shareholders who continue with their investment in the Company.
The Tender Offer is not conditional on Ordinary Shares trading at a discount to the Net Asset Value per Ordinary Share as at the Calculation Date (i.e. the share price per Ordinary Share being less than the Net Asset Value per Ordinary Share). In the event that Ordinary Shares are trading at a premium to the Net Asset Value per Ordinary Share as at the Calculation Date (i.e. the share price per Ordinary Share is higher than the Net Asset Value per Ordinary Share), Qualifying Shareholders who tender Ordinary Shares may receive less than they could otherwise be able to realise in the market.
Ordinary Shares which are tendered for acceptance under the Tender Offer may not be sold, transferred, charged or otherwise disposed of; Ordinary Shares which are tendered for acceptance under the Tender Offer may not be withdrawn without the absolute discretion of the Board.
The Tender Offer will only be open to Qualifying Shareholders whose names appear on the Register at 6 p.m. on 26 August 2022, the Tender Offer Record Date, in respect of Ordinary Shares continually held from that date until the Calculation Date. The Tender Offer is subject to certain conditions to be set out in the Circular. In addition, the Tender Offer may be suspended or terminated in certain circumstances, as set out in the Circular.
There is no guarantee that any or all Ordinary Shares tendered will be repurchased by the Company.
Alternative courses of action for Qualifying Shareholders
-- Apply to tender their Basic Entitlement, as described above.
-- Apply to tender fewer Ordinary Shares than their Basic Entitlement.
-- Apply to tender Ordinary Shares above their Basic Entitlement and, to the extent that other QualifyingShareholders do not tender up to their Basic Entitlement, such applications will be satisfied proportionately toother Excess Applications.
Restricted Shareholders and Overseas Shareholders
The Tender Offer is not being made to those Shareholders who are resident in, or citizens of, a Restricted Territory. In particular the Tender Offer is not being made, directly or indirectly, in or into or by the use of mails by any means or instrumentality (including, without limitation, facsimile transmission, internet, telex and telephone) of interstate or foreign commerce, or any facility of a national securities exchange, of the United States, nor is it being made, directly or indirectly, in or into the United States, Canada, Australia, New Zealand, the Republic of South Africa or Japan and the Tender Offer cannot be accepted by any such use means, instrumentality or facility from within the United States, Canada, Australia, New Zealand, the Republic of South Africa or Japan.
It is the responsibility of all Overseas Shareholders to satisfy themselves as to the observance of any legal requirements in their jurisdiction, including, without limitation, any relevant requirements in relation to the ability of such holders to participate in the Tender Offer.
Costs and expenses of the proposals
The costs and expenses relating to the Tender Offer will be borne by the Company. The fixed costs and expenses relating to the Tender Offer up to the Calculation Date and assuming that the Tender Offer is taken up in full, are not expected to exceed an aggregate of approximately GBP216,795 (inclusive of VAT but excluding the commission payable to finnCap of 0.15 per cent. of the value at the Tender Price of the Ordinary Shares purchased by finnCap in the Tender Offer).
BENEFITS OF THE TENDER OFFER
The Board considers the Tender Offer and the resultant Repurchases to be in the best interests of the Company and Shareholders as a whole and is, therefore, recommending that Shareholders vote in favour of the Resolution. However, the Board is not making any recommendation to Shareholders as to whether tendering Ordinary Shares under the Tender Offer is in their own individual best interests. Whether or not Qualifying Shareholders decide to tender all or any of their Ordinary Shares is a decision for individual Qualifying Shareholders.
Qualifying Shareholders should take into account their financial and tax position, and their investment objectives, when deciding whether or not to participate in the Tender Offer. A summary of material UK taxation considerations in connection with the Tender Offer will be set out in the Circular. Qualifying Shareholders are advised to take independent advice in relation to the tax implications for them of selling Ordinary Shares pursuant to the Tender Offer.
The Board reserves the right not to proceed with the Tender Offer (and the resultant Repurchases) if it concludes, at any time prior to the announcement of the results of the Tender Offer, that the implementation of the Tender Offer (and the associated Repurchases) is no longer in the interests of the Company and the Shareholders as a whole.
Shareholders are recommended to read the Circular which sets out the full terms and conditions of the Tender Offer and how applications can be made under the Tender Offer.
GENERAL MEETING
A general meeting is being convened at 11:30 a.m. on 26 September 2022 at Gridiron Building, 1st Floor, One Pancras Square, London N1C 4AG to consider and, if thought fit, pass the Resolution, which seeks the approval of Shareholders for the grant of authority to the Company to implement the Tender Offer. The Resolution will be a special resolution, requiring not less than 75 per cent. of the votes cast at the General Meeting to be in favour of it in order for it to be passed. The Company will only implement the Tender Offer if the Resolution is passed at the General Meeting.
RELATIONSHIP BETWEEN THE TENDER OFFER AND THE COMPANY'S SHARE BUY-BACK PROGRAMME
The Company's monthly share buy-back programme announced on 9 August 2021, which was extended on 1 August 2022, will be unaffected by the Tender Offer and will continue to run until 31 July 2023. Shareholders may participate in either or both of the Tender Offer and the buy-back programme in accordance with their respective terms and conditions.
Tender Offer
Shareholders are not obliged to tender any Ordinary Shares.
Full details of the procedure for tendering Ordinary Shares will be set out in the Circular and, in the case of Ordinary Shares held in certificated form, on the Tender Form.
RECOMMENDATION
The Board considers the Tender Offer and the resultant Repurchases to be in the best interests of the Company and Shareholders as a whole. Accordingly, the Board unanimously recommends that Shareholders vote in favour of the Resolution to be proposed at the General Meeting. The Directors intend to vote in favour of the Resolution in respect of their holdings of Ordinary Shares amounting to 511,216 Ordinary Shares, in aggregate (representing approximately 7.2 per cent. of the issued Ordinary Share capital of the Company, as at the Latest Practicable Date).
Whether or not Shareholders decide to tender their Ordinary Shares will depend, amongst other factors, on their view of the Company's prospects and their own individual circumstances, including their own financial and tax positions and investment objectives. A summary of material UK taxation considerations in connection with the Tender Offer will be set out in the Circular. Qualifying Shareholders are advised to take independent advice in relation to the tax implications for them of selling Ordinary Shares pursuant to the Tender Offer.
The Directors will not tender any of their own Ordinary Shares.
The Directors make no recommendation to Shareholders as to whether or not they should tender all or any of their Ordinary Shares in the Tender Offer. Whether or not Shareholders decide to tender their Ordinary Shares will depend, amongst other factors, on their view of the Company's prospects and their own individual circumstances, including their own tax position.
DEFINITIONS
In this announcement the words and expressions listed below have the meanings set out opposite them, except where the context otherwise requires:
AIFM alternative investment fund manager, which has the meaning given to it in regulation 4 of the UK AIFM
Regulations;
the entitlement of each Shareholder (other than a Restricted Shareholder) to tender up to 10 per cent.
Basic of the Ordinary Shares registered in such Shareholder's name on the Tender Offer Record Date rounded
Entitlement down to the nearest whole number, as more particularly described in Part I of the Circular under the
heading "Tender Offer";
Board or the directors of the Company or any duly constituted committee thereof;
Directors
Calculation 6 p.m. on 26 September 2022;
Date
certificated
or in
certificated not in uncertificated form (as described below);
form
Circular the Circular to Shareholders setting out the terms of the tender and convening the General Meeting
Company Rights and Issues Investment Trust plc;
Company's www.maitlandgroup.com/investment-trusts/rights-and-issues-investment-trust-plc/;
Website
CREST the system for the paperless settlement of trades in securities and the holding of uncertificated
securities operated by Euroclear in accordance with the CREST Regulations;
Euroclear Euroclear UK & International Limited, being the operator of CREST;
Excess an application by a Qualifying Shareholder tendering for more than their Basic Entitlement;
Application
General the general meeting of the Company to consider the Resolution, convened for Monday, 26 September 2022 at
Meeting or 11:30 a.m., or any adjournment thereof;
Meeting
Jupiter Unit
Trust Managers Jupiter Unit Trust Managers Limited;
or JUTM
Latest
Practicable 25 August 2022;
Date
London Stock London Stock Exchange plc (a company registered in England and Wales with registered number 2075721);
Exchange
in relation to an Ordinary Share, its net asset value, in relation to Ordinary Shares the net asset
Net Asset value per Ordinary Share multiplied by the number of shares of that class in issue and in relation to
Value or NAV the Company, the net asset value of the Company as a whole, in each case determined by the Board in
accordance with the Company's normal accounting policies from time to time (excluding any Ordinary
Shares held in treasury);
Ordinary ordinary shares of 25p each in the capital of the Company;
Shares
a Shareholder who is not resident in, or a citizen of, a territory outside the United Kingdom and not
Overseas resident in, or a citizen of, any of the Restricted Territories;
Shareholder
Shareholders entitled to participate in the Tender Offer, being those who are on the Register on the
Qualifying Tender Offer Record Date and who are not Restricted Shareholders;
Shareholders
Receiving Link Group, Corporate Actions of 10th Floor, Central Square, 29 Wellington Street, Leeds, LS1 4DL;
Agent
Register the Company's register of members;
Regulatory
Information a service approved by the London Stock Exchange for the distribution to the public of announcements;
Service
Repurchases purchases by the Company from finnCap of Tendered Shares from finnCap in connection with the Tender
Offer pursuant to the authority granted under the Resolution;
Resolution the special resolution to be proposed at the General Meeting;
Restricted a Shareholder who is resident in, or a citizen of, a Restricted Territory;
Shareholder
each of the United States, Canada, Australia, New Zealand, the Republic of South Africa, Japan and any
Restricted other jurisdiction where the mailing of the Tender Form or accompanying documents into or inside such
Territory jurisdiction would constitute a violation of the laws of such jurisdiction;
a holder of Ordinary Shares;
Shareholder
the lawful currency of the UK;
Sterling or GBP
the tender form to be issued with the Circular to Qualifying Shareholders for use in respect of Ordinary
Tender Form Shares held in certificated form;
the meaning given in this announcement under the heading "Background";
Tender Offer
the meaning given in Part I of the Circular under the heading "Background";
Tender Price
Tender Offer 6 p.m. on 26 September 2022;
Record Date
Tendered Ordinary Shares lodged for repurchase under the Tender Offer;
Shares
UK or United the United Kingdom of Great Britain and Northern Ireland;
Kingdom
UK AIFM the Alternative Investment Fund Managers Regulation 2013 (SI 2013/1733), as amended; and
Regulations
US or United the United States of America, its territories and possessions, any state of the United States of America
States and the District of Columbia.
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[*] Based on the percentage increase in the Company's NAV per Ordinary Share as at the 31 December 2021 (being the last audited NAV per Ordinary Share of the Company), since 31 December 1984.
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ISIN: GB0007392XXX Category Code: TEN TIDM: RIII LEI Code: 2138002AWAM93Z6BP574 Sequence No.: 184539 EQS News ID: 1430633 End of Announcement EQS News Service =------------------------------------------------------------------------------------
Image link: https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=show_t_gif&application_id=1430633&application_name=news
(END) Dow Jones Newswires
August 30, 2022 02:00 ET (06:00 GMT)
