Terra Capital PLC Circular re: Realisation Opportunity (6136R)
15 Junho 2018 - 12:30PM
UK Regulatory
TIDMTCA
RNS Number : 6136R
Terra Capital PLC
15 June 2018
Terra Capital PLC
Legal Entity Identifier: 2138006S6U2X7L4R8V74
15 June 2018
Circular re Realisation Opportunity
Terra Capital PLC (the "Company")
Further to the announcement released on 19 April 2018, which
announced that, subject to the formal approval of Shareholders, the
Board would dispense with the realisation opportunity that was to
be offered in June 2018 and instead cease all new investments and
seek to realise, in an orderly fashion, the Company's portfolio of
investments and return the net proceeds generated to Shareholders
as soon as is practicable (the "New Investment Policy"), the
Company is pleased to announce the despatch of a Circular to
Shareholders giving details of the New Investment Policy and
changes to its constitutional arrangements (including
re-registering the Company under the Isle of Man Companies Act 2006
in order to give effect to these proposals.
The Circular contains information on the New Investment Policy,
the constitution and the investment management arrangements to be
introduced to facilitate the New Investment Policy. The Board
continues to believe an orderly realisation of the portfolio of
investments is preferable to an immediate liquidation as it is
likely to achieve greater returns to Shareholders. It is currently
envisaged that returns to Shareholders will be effected by means of
a pro-rata compulsory redemption mechanism.
The Board, having consulted with Shareholders, believe it is
appropriate and in the best interests of Shareholders to
incentivise the Investment Manager to realise, in accordance with
the New Investment Policy, the Company's portfolio of investments
in a timely fashion. It is proposed that the arrangements with the
Investment Manager be varied such that the current fee structure,
1.25 per cent. per annum of NAV and a performance fee linked to NAV
increases, will be replaced with an arrangement whereby the
Investment Manager will be entitled to receive a fee equal to 1 per
cent. of any Distributions made to Shareholders, which would
include cash that is returned by way of a Compulsory Redemption of
Ordinary Shares. The new fee arrangements will be deemed to come
into effect on 1 July 2018. Although on an ongoing basis the
Investment Manager will not be entitled to receive a performance
fee, the Investment Manager will be entitled to receive a
performance fee in respect of the period ending 30 June 2018 if it
is due such a fee under the existing arrangements.
The Board believes that the proposed changes to the fee
arrangements will, in the light of the New Investment Policy,
better align the interests of Shareholders and the Investment
Manager. The Board consulted with Shareholders concerning the
proposed new arrangements and has received support from
Shareholders who between them hold approximately 58 per cent. of
the issued share capital of the Company.
For the purposes of the AIM Rules, the entering into of the
revised fee arrangements outlined above would constitute a related
party transaction. In this regard the Board considers, having
consulted with Panmure Gordon, the Company's nominated adviser,
that the proposed revised arrangements are fair and reasonable
insofar as Shareholders are concerned.
The Circular convenes a meeting of Shareholders to take place at
10.00 am on 10 July 2018 to allow the approval of the necessary
changes to the Company's investment policy and Articles of
Association.
Copies of the Circular will shortly be available at
www.terracapitalplc.com . Terms defined in the Circular have the
same meaning in this announcement.
For more information, please visit www.terracapitalplc.com or
contact:
Galileo Fund Services Limited (Administrator)
Frazer Pickering
+44 1624 692600
Panmure Gordon (UK) Limited (Nominated adviser and corporate
broker)
Jonathan Becher
+44 20 7886 2500
Terra Capital plc.
Ian Dungate, Director
+44 1624 692600
NOTES:
Terra Capital plc is an AIM quoted investment company focussed
on generating high absolute returns while attempting to keep
volatility to a minimum. The Fund predominantly invests in
under-researched and under-valued companies listed on Frontier
Market stock exchanges. The Fund Manager targets for investment
companies that it believes are trading for less than their
intrinsic worth and so, aside from any potential growth prospects,
provide scope for capital appreciation as a result of a reversion
towards their underlying value. Investments are also made in
companies which are viewed as trading at fair value but which offer
opportunities for growth at a reasonable price. The Investment
Manager believes many such 'value' opportunities can be found in
Frontier Markets due to inherent market inefficiencies in such
markets. The Manager utilises in-house teams of its own analysts,
resident on the ground in areas of interest to investigate suitable
opportunities rather than rely on third party research.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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