City of London Investment Group PLC Intended publication of a circular (4015U)
06 April 2021 - 4:00PM
UK Regulatory
TIDMCLIG
RNS Number : 4015U
City of London Investment Group PLC
06 April 2021
City of London Investment Group PLC ("CLIG")
Intended publication of a circular
Your Board has become aware of an issue in respect of the
payment of certain historic dividends (the "Relevant
Distributions"), which has resulted in a technical infringement of
the Companies Act 2006 (the "Act").
The issue is of an historic nature and there is no change to the
financial outlook of the Company as a consequence of this technical
matter. It is anticipated it will have no impact on the Group's
dividend policy or dividend-paying capacity going forward. The
Company's past accounts will not need to be restated and no
dividends are expected to be repaid.
The Act requires it to be demonstrated by reference to accounts
filed at Companies House prior to payment that the Company has
sufficient reserves to pay distributions at the time they are made.
Whilst the Group has at all times had sufficient distributable
reserves on a consolidated basis to pay the Relevant Distributions,
these reserves had not always been distributed upward to CLIG, the
holding company, from its operating subsidiaries at the time of
declaration. In addition, interim accounts were not always filed
with Companies House to show the availability of sufficient
distributable reserves in respect of Relevant Distributions by
CLIG. Regrettably, the Relevant Distributions were therefore not
paid in strict accordance with the Act.
As a result, the Group has been advised that, from a legal
perspective, it may have claims against shareholders who were in
receipt of these Relevant Distributions and against individuals who
were directors at the time they were paid. The Company will
therefore convene a general meeting at which it will put forward
resolutions which will, if passed, address the situation and put
all parties back in the position they were intended to be had the
full technical requirements of the Act been complied with at the
time the Relevant Distributions were made. The Board will set out
full details of the Relevant Distributions in the circular to be
posted to shareholders convening the general meeting. The steps
being proposed are also in line with those taken by other listed
companies that have encountered similar issues in the past.
The Board has undertaken a thorough and detailed review of its
reserves and is confident all issues have been identified and that
the necessary procedural and administrative improvements have been
implemented.
For further information, please visit www.citlon.co.uk or
contact:
Tom Griffith, CEO
City of London Investment Group PLC
Tel: 001-610-380-0435
Martin Green/Pippa Hamnett
Zeus Capital Limited
Financial Adviser & Broker
Tel: +44 (0)20-3829-5000
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END
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