TIDMH2O
RNS Number : 9517J
Aqua Resources Fund Limited
14 August 2012
14 August 2012
Aqua Resources Fund Limited
The Board of Aqua Resources Fund Limited ("Aqua" or the
"Company") today announces an outline proposal (the "JPM PEA
Proposals"), received from the Private Equity Advisor Group at
JPMorgan Asset Management ("JPM PEA"), to increase its shareholding
to up to 29.9% of the Company, subject to final agreement of terms
and processes with the Board.
In the context of the Company's intention, announced on 28 June
2012, to propose the cancellation of the listing of the Company's
ordinary shares (the "Ordinary Shares") on the Official List of the
UK Listing Authority and from trading on the London Stock
Exchange's Main Market for Listed Securities ("the Cancellation"),
the Company further announces its intention to seek shareholder
approval to amend its investment policy to preclude further new
investments and to remove the diversification test.
The JPM PEA Proposals
JPM PEA manages JPMorgan Private Equity Limited and JPMorgan
Special Opportunities Fund (collectively, the "JPMorgan Funds"),
which together currently hold 11,371,926 (15.7%) of the Company's
Ordinary Shares. Under the JPM PEA Proposals, JPM PEA has indicated
to the Board that the JPMorgan Funds would be willing to acquire up
to 10,294,911 Ordinary Shares for 35 cents each (the "Tender
Price"), from those shareholders who would like to sell down some
or all of their shareholding ahead of the Cancellation. This Tender
Price of 35 cents is at a premium of 20.7 per cent to the closing
price as at close of business on 13 August 2012 (being the last
business day before this announcement).
To facilitate the JPM PEA Proposals, the Company has agreed to
conduct a tender offer (the "Tender Offer") for up to 10,294,911
(representing 14.2% of the current Ordinary Shares in issue)
Ordinary Shares (or such other number of Ordinary Shares which when
taken with the JPMorgan Funds' shareholding on the effective date
for the Tender Offer would not cause JPM PEA and the JPMorgan Funds
to control more than 29.9% of voting rights in the Company) (the
"Tender Threshold"), at the Tender Price in October 2012.
Shareholders will be able to tender none, some or all of their
shareholding. To the extent that shareholders tender shares in
excess of the Tender Threshold, applications will be scaled back
pro rata. JPM PEA, on behalf of the funds it manages, has agreed to
acquire all tendered shares for 35 cents. If the Tender Offer is
fully subscribed, funds managed by JPM PEA would together hold
21,666,837 (29.9%) of the Company's Ordinary Shares.
The Cancellation
As noted in the Chairman's Statement in the Annual Report and
Accounts of the Company for the year ended 31 December 2011
(published on 26 April 2012) and its interim management statement
(published on 18 May 2012), the Company no longer meets the "free
float" requirement of the UK Listing Rules (Listing Rule 6.1.19)
which stipulates that 25 per cent of the shares in a company listed
on the Official List of the UK Listing Authority should be held in
'public hands' (which excludes shares held by shareholders who are
directors or who own more than 5 per cent. of the share capital of
such company).
In considering the proposed Cancellation, the Board has
reviewed:
1) the poor liquidity and very low daily turnover in the Shares
on the London Stock Exchange, which this calendar year have traded
on only 45 days,
2) the persistently wide share price discount to net asset value
(currently approximately 70 per cent.),
3) the concentration of the portfolio,
4) the advantages and disadvantages of a listing of the Ordinary
Shares on another recognised stock exchange in the context of the
known views of certain shareholders,
5) an overview of the current shareholder base, and
6) that a delisting will entail a material change for
shareholders.
Subject to regulatory clearances and Shareholder approval at an
extraordinary general meeting (the "EGM"), it is expected the
delisting will become effective around the end of October 2012.
Amendment to the Investment Policy
At the EGM, the Board intends to put forward an ordinary
resolution to shareholders to amend the Company's current
investment objective and policy. It is proposed that the current
investment objective and policy is supplemented with the following
provision:
"No New Fund Investments
It is the general policy of the Company not to make new fund
investments. It is the intention of the Company to continue to meet
its existing capital commitments. The Company may support follow-on
commitments in existing investments subject to prior approval by
the Board of such investment."
It is also proposed that the following text is deleted from the
diversification section of the current investment objective and
policy:
"Once investments have been completed, it is anticipated that no
single investment, at the time of acquisition, may exceed 30% of
the gross assets of the Company."
"In addition, in exceptional circumstances, the Board may
authorise the acquisition of an investment or asset which exceeds
the 30 per cent limit and is up to 50% of gross assets, at the time
of acquisition. Such authorisation may only be given in
circumstances where the Board considers the acquisition to be of
strategic importance to the Company in achieving its overall
investment objective and the Manager has, at the time of
acquisition, presented to the Board for approval a proposal for
rebalancing the Portfolio to within the 30% limit as soon as
practicable (and in any event within a period not exceeding 18
months) by means of further capital raisings, additional
investments, disposals of part of an investment or otherwise."
In all other respects the current investment objective and
policy will remain unchanged.
Further details of the JPM PEA Proposals, Cancellation and
associated amendments to the Company's articles of incorporation,
amendment to the investment policy and notice of EGM expected to be
held in September 2012 (rather than August 2012 as indicated in the
announcement on 28 June 2012.), will be contained in a circular to
be posted to shareholders as soon as practicable.
For further enquiries:
Aqua Resources Fund Limited
Hasan Askari, Chairman +44 (0)7785 307 759
FourWinds Capital Management, Investment Manager info@fourwindscm.com
Kimberly Tara, Chief Executive Officer
Cenkos Securities plc
Will Rogers +44 (0)20 7397 1920
Important Information
The information related to the Company included in this
statement is provided for information purposes only and does not
constitute an invitation or offer to subscribe for or purchase
shares in the Company. This material is not intended to provide a
sufficient basis on which to make an investment decision. All
investments are subject to risk. An investment in the Company
should be regarded as long term in nature and is suitable only for
sophisticated investors, investment professionals, high net worth
individuals, unincorporated associations and partnerships and
trustees of high value trusts, in each case, who can bear the
economic risk of a substantial or entire loss of their investment.
Prospective investors are advised to seek expert legal, financial,
tax and other professional advice before making any investment
decisions.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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