TIDMTLI
RNS Number : 6559O
Alternative Asset Opps PCC Ltd
08 November 2016
For immediate release on 8 November 2016
This announcement contains inside information
Alternative Asset Opportunities PCC Limited
Recommended proposals for the voluntary liquidation of the
Company
Following approval of the change to the investment objective by
shareholders at the Extraordinary General Meeting held on 10
October 2016, the completion of the transfer of ownership and
beneficiary of each policy to the purchaser is taking place in
batches on a weekly basis. As at the close of business on 4
November 2016, a further 11 policies had been fully transferred to
the purchasers, Vida Longevity L.P and Life Equity LLC and
additional funds of US$2.9 million had been received. In accordance
with the Board's cash policy, a further US$3.0 million has been
converted into Sterling. So far, therefore, a total of 38 policies
have been fully transferred and funds of US$19.8 million have been
received. Funds received include the refund of associated premium
payments made since the risk transfer date of 12 September to keep
the policies valid and in effect. There are 42 policies remaining
in the transfer process.
With completion now having taken place on almost half the
policies in the portfolio, the Board of Alternative Asset
Opportunities PCC Limited (the "Company") announces that it is
today publishing a circular (the "Circular") containing details of
proposals for the voluntary liquidation of the Company and
cancellation of the admission of its Shares to trading on the Main
Market of the London Stock Exchange.
The Chairman's Letter, as contained in the Circular, is set out
below.
Terms used and not defined in this announcement bear the meaning
given to them in the Circular.
"Dear Shareholder
Recommended proposals for the voluntary liquidation of the
Company and cancellation of the admission of its Shares to trading
on the Main Market of the London Stock Exchange
and
Notice of Extraordinary General Meeting
1. INTRODUCTION
The Company is a protected cell company registered in Guernsey
with one cell known as the US Traded Life Interests Fund (the
"Cell").
On 13 September 2016 the Board announced that it had entered
into a conditional agreement for the sale of 71 of its 80 policies
to Vida Longevity Fund, L.P for $40 million (the "Vida Disposal")
and was seeking Shareholder approval for a change to the Cell's
investment objective and policy to allow for the Vida Disposal to
take place.
On 26 September 2016 the Board made a further announcement of
the sale of the remaining nine policies for $3.25 million (the
"Secondary Disposals" and, together with the Vida Disposal, the
"Portfolio Disposal"). Six of the remaining nine policies were sold
to Vida on the same terms as the Vida Disposal (and therefore were
subject to Shareholder approval) and three were sold to Life Equity
LLC and were not conditional on Shareholder approval. In total
therefore, pursuant to the Portfolio Disposal, the Company has sold
its entire portfolio for a consideration of $43.25 million.
Shareholder approval for the Vida Disposal was granted on 10
October 2016 and completion of the disposal of 38 policies has
taken place with the balance expected shortly.
Following the Portfolio Disposal, and as set out in the circular
to Shareholders dated 13 September 2016, the Board believes it is
in the best interests of Shareholders that the Company be placed
into voluntary liquidation in accordance with the Companies Law and
that the listing of the Shares on the Official List and their
admission to trading on the Main Market be cancelled (the
"Proposals").
The Proposals are subject to the approval of Shareholders. A
Notice of Extraordinary General Meeting, at which the Resolutions
to approve the Proposals will be considered, is set out at the end
of this Circular. If approved, the Proposals will result in the
voluntary liquidation of the Company. Surplus funds remaining after
the Liquidators have settled all liabilities of the Company
(including the costs of the Company's liquidation) will be
distributed to Shareholders as set out below.
Following the completion of the Portfolio Disposal, the
Company's assets will consist primarily of cash or cash
equivalents. It is expected that the Liquidators will be able to
satisfy the Company's liabilities and distribute a substantial
portion of the surplus assets of the Company within a short period
following the commencement of the voluntary liquidation of the
Company.
The purpose of this Circular is to convene the EGM to be held at
the office of Allianz Global Investors GmbH, UK Branch, 199
Bishopsgate, London, EC2M 3TY at 12.00 noon on 8 December 2016. At
the EGM the Board proposes to put the Resolutions to the
Shareholders seeking their approval to:
-- put the Company into members' voluntary liquidation; and
-- appoint Gareth Morris and Andrew Sheridan of FRP Advisory LLP
as liquidators of the Company (the "Liquidators") with a view to
effecting the voluntary liquidation of the Company.
Following the EGM, and assuming that the Resolutions are passed,
the Board will resolve to cancel the admission of the Shares to
listing on the Official List and to trading on the Main Market.
1.1 Liquidity Profile and Current Portfolio
On 20 October 2016 the Company announced that its unaudited
estimated NAV as at 30 September 2016 was 51.7p per Share
(equivalent to net assets of $48.4 million based on an exchange
rate of GBP1:$1.299) which comprised primarily cash of $5.2 million
and policies valued at their contracted sale price of $43.25
million. Since that date, $25.0 million of the Company's cash
balances has been converted to Sterling. As at the date of this
document, 38 policies have successfully completed the transfer
process pursuant to the Portfolio Disposals and proceeds (including
premium reimbursements) of $19.8 million have been received; the
remaining 42 policies with a value of $24.1 million (including
premium reimbursements) are in the process of being
transferred.
On the assumption that the remaining 42 policies successfully
complete the transfer process and proceeds, after conversion, of
GBP19.3 million are received (assuming an exchange rate of
GBP1:$1.25), the estimated terminal NAV of the Company, allowing
for the Liquidators' estimated fees, a Retention of GBP100,000, any
expenses properly incurred by the Liquidators in connection with
the liquidation and provision for all of the Company's other
liabilities, is likely to amount to approximately GBP39.0 million,
equivalent to approximately 54p per Share. Shareholders should note
that this estimate is for illustrative purposes only and should not
be relied upon. To the extent that an over-provision for the
Company's liabilities has been made, or any part of the Retention
(as defined below) is un-utilised, the Company's remaining assets
will also be distributed to Shareholders.
1.2 Appointment of Liquidators and Liquidation
Subject to Shareholders passing the Resolutions at the EGM,
Gareth Morris and Andrew Sheridan of FRP Advisory LLP will be
appointed as liquidators of the Company and their remuneration
shall be determined by the Company. The appointment of the
Liquidators will take effect immediately upon the passing of the
Resolutions at the EGM. Upon the appointment of the Liquidators,
all powers of the Board will cease and the Liquidators will be
responsible for the affairs of the Company until it is wound up.
The Liquidators will wind up the Company in accordance with
Guernsey law, will discharge the liabilities of the Company and,
following satisfaction of all the creditors of the Company, will
divide any surplus assets of the Company among the Shareholders
according to their respective rights and interests in the
Company.
The Liquidators will also establish a reserve (the "Retention")
of such amount as they consider appropriate to meet the Company's
liabilities and estimated costs and expenses whilst in liquidation.
The Liquidators estimate that the Retention will amount to
approximately GBP100,000. The Liquidators may, but shall not be
obliged to, make interim liquidation distributions to Shareholders,
to be followed by a final distribution. Any interim distribution by
the Liquidators will take account of the need to provide for the
Retention. Any surplus funds remaining from the Retention after the
Liquidators have settled all liabilities, costs and expenses, will
be distributed to Shareholders at the conclusion of the
liquidation. Payment will be made through CREST (where possible) or
by cheque provided that any such amount payable to a Shareholder is
at least GBP5.00 or more. Subject to Shareholders' approval of the
relevant resolution, where less than GBP5.00 is payable to a
Shareholder, the amount will be transferred instead by the
Liquidators to Marie Curie (registered charity number 270994 and
whose registered office is at 89 Albert Embankment, London, SE1
7TP), as the distribution of any amount less than GBP5.00 to a
Shareholder is likely to be nullified by the administrative costs
of making such distribution.
Since the Company's assets are expected to comprise primarily
cash at the date of appointment of the Liquidators, the Board has
been advised that the Liquidators currently intend to make an
initial distribution to Shareholders in early January to allow
sufficient time to advertise for creditor claims.
The liquidation will commence on the passing of the Resolutions.
Subject to the approval of the Resolutions and the appointment of
the Liquidators and their assumption of responsibility for the
affairs of the Company in place of the Board, Tim Emmott, Ian
Reynolds and John Scott intend to resign as directors at the
conclusion of the EGM. In order to comply with the Companies Law
and facilitate a smooth transfer to the Liquidators, Charles Tracy
will remain as a director until the Company is struck off from the
Register of Companies in Guernsey, which is expected to occur three
months following the conclusion of the liquidation.
1.3 Key Contracts
The Company is party to several key contractual commitments. In
the event that the Resolutions are passed these key contracts will
be dealt with as follows (other non-key contracts are primarily
based on immediate termination in the event of one or more of the
parties going into liquidation).
Revolving Credit Facility
Notice of termination was served on 14 October 2016. There were
no fees payable on termination.
Investment Management Agreement and Management Agreement
Both the Investment Management Agreement and the Management
Agreement may be terminated forthwith on the liquidation of the
Company. If the Resolutions are approved, the Company will
immediately give written notice to the relevant counterparties and
will make a payment of any accrued investment management fees and
other expenses.
Administration and Secretarial Services Agreement and
Administration Agreement
Both the Administration and Secretarial Services Agreement and
the Administration Agreement may be terminated immediately on the
liquidation of the Company. If the Resolutions are approved, the
Company will immediately give written notice to the relevant
counterparties.
Custodian Agreement and Sub-Custodian Agreement
The Custodian and Sub-Custodian Agreements provide for
termination on six months' notice. Notices of termination were
served on 20 October 2016; the formal notice period has been waived
by all parties and the termination notices therefore provide for
termination to occur on the later of the liquidation date and the
date on which the last remaining assets of the Company are
transferred from the Company's custody account to the Liquidators'
account.
1.4 Suspension and cancellation of admission of the Shares to trading on the Main Market
The register of members will be closed at 6.00 p.m. on 7
December 2016 and the Shares will be disabled in CREST at the start
of business on 8 December 2016. Accordingly, to be valid, any CREST
transfers of Shares must be lodged before 6.00 p.m. on 5 December
2016. Application will be made to the UKLA for suspension of the
listing of the Shares on the Official List and application will be
made to the London Stock Exchange for suspension of trading in the
Shares on the Main Market, in each case, at 7.30 a.m. on 8 December
2016. The last day for dealings in the Shares on the Main Market on
a normal rolling two-day settlement basis will be 5 December 2016.
After 5 December 2016, dealings should be for cash settlement only
and will be registered in the normal way if the transfer,
accompanied by the documents of title, is received by Capita Asset
Services by close of business on 7 December 2016. If the
Resolutions are not passed, following the EGM the Company will make
application for the above suspension to be lifted and for dealings
in CREST to resume.
If the Resolutions are passed, following the EGM the Company
will make applications for the cancellation of the listing of the
Shares on the Official List and their admission to trading on the
Main Market. Such cancellations are expected to take effect at 8.00
a.m. on 9 December 2016.
After the liquidation of the Company and the making of the final
distribution to Shareholders (if any), existing certificates in
respect of the Shares will cease to be of value and any existing
credit of the Shares in any stock account in CREST will be
redundant.
1.5 Costs of the Proposals
The expenses incurred in relation to the Proposals (including
professional advice and the Liquidators' fees) are currently
estimated to amount to approximately GBP152,000. This figure
excludes the fees and expenses of service providers in the ordinary
course of business up to the date of the Liquidators' appointment
in accordance with the terms of their engagement.
2. EXTRAORDINARY GENERAL MEETING
Set out at the end of this Circular is a notice convening an
Extraordinary General Meeting to be held at 12.00 noon at the
office of Allianz Global Investors GmbH, UK Branch, 199
Bishopsgate, London, EC2M 3TY on 8 December 2016, at which a
special resolution will be proposed to voluntarily wind up the
Company pursuant to section 391(1)(b) of The Companies Law, a
further special resolution will be proposed to authorise the
Liquidators to pay any distribution amounts less than GBP5.00 to
charity and three ordinary resolutions will be proposed to approve
the appointment of, and other matters relating to, the
Liquidators.
All Shareholders are entitled to attend and vote at the EGM. All
holders of the Management Shares are entitled to receive notice of
and attend the EGM but do not have the right to vote at the
EGM.
In accordance with the Company's Articles of Incorporation, each
Shareholder present in person (or by a corporate representative) or
by proxy shall, upon a show of hands, have one vote and upon a poll
shall have one vote for every Share held. Two Shareholders present
in person (or by a corporate representative) or by proxy and
holding 5 per cent. of the total voting rights of the Company
between them (excluding any Shares held as treasury shares) will
constitute a quorum.
In order for the Resolutions to be passed, Resolutions 1 and 2,
being special resolutions, must be approved by a majority of not
less than 75 per cent. of the votes cast by Shareholders who, being
entitled to vote, are present in person, by proxy or by a corporate
representative at the EGM and Resolutions 3 to 5, being ordinary
resolutions, must be approved by a simple majority of the votes
cast by Shareholders who are present in person, by proxy or by a
corporate representative at the EGM.
3. CONSEQUENCES OF THE PROPOSALS NOT BEING APPROVED
The Proposals are conditional on the passing of the Resolutions
and, if they are not passed, the Proposals will not be implemented.
In these circumstances, the Company will continue in its current
state and the Board would consult with Shareholders as to the
future course of action.
4. DOCUMENTS AVAILABLE FOR INSPECTION
Copies of this Circular will be available for inspection at the
offices of Herbert Smith Freehills LLP, Exchange House, Primrose
Street, London, EC2A 2EG and at the registered office of the
Company during normal business hours on any Business Day from the
date of this Circular until the conclusion of the Extraordinary
General Meeting and at the place of the Extraordinary General
Meeting for at least 15 minutes prior to, and during, the
meeting.
A copy of this Circular has been submitted to the National
Storage Mechanism and will shortly be available for inspection at:
www.morningstar.co.uk/uk/NSM.
5. TAXATION
The following comments are intended only as a general guide to
certain aspects of current UK tax law and HM Revenue & Customs'
published practice, both of which are subject to change possibly
with retrospective effect. They are of a general nature and do not
constitute tax advice and apply only to Shareholders who are
resident in the UK (except where indicated) and who hold their
Shares beneficially as an investment. They do not address the
position of certain classes of Shareholders such as dealers in
securities, insurance companies or collective investment schemes.
The information below does not constitute legal or tax advice to
any Shareholder. If you are in any doubt about your tax position,
or if you may be subject to tax in a jurisdiction other than the
United Kingdom, you should consult your independent professional
adviser.
Any Shareholder who is UK tax resident may, depending on that
Shareholder's personal circumstances, be subject to capital gains
tax (or, in the case of a corporate Shareholder, corporation tax on
chargeable gains) in respect of any gain arising on a disposal
(including on any distribution in the final liquidation of the
Company) of their Shares. For such individuals, capital gains are
taxed at a rate of 10 per cent. (for basic rate taxpayers) or 20
per cent. (for higher or additional rate taxpayers). Individuals
may, depending on their personal circumstances, benefit from
certain reliefs and allowances (including an annual exemption from
capital gains which is GBP11,100 for the tax year 2016/2017). For
corporate Shareholders within the charge to UK corporation tax,
indexation allowance may apply to reduce any chargeable gain
arising on the disposal of Shares but will not create or increase
an allowable loss. Shareholders who are not resident in the UK for
taxation purposes will not normally be liable to UK taxation on
chargeable gains arising from the disposal of their Shares unless
those Shares are held for the purposes of a trade, profession or
vocation through a UK branch, agency or permanent establishment,
although they may be subject to foreign taxation depending on their
own particular circumstances. Individual Shareholders who are
temporarily not resident in the UK for tax purposes may be liable
to capital gains tax under anti-avoidance legislation.
6. ACTION TO BE TAKEN
You will find enclosed with this Circular a Form of Proxy for
use at the EGM. Whether or not you propose to attend the EGM in
person, you are asked to complete the Form of Proxy and return it
to Capita Asset Services, at PXS1, The Registry, 34 Beckenham Road,
Beckenham, Kent, BR3 4ZF so as to arrive as soon as possible, but
in any event so as to be received not later than 12 noon on 6
December 2016. Completion and return of a Form of Proxy will not
preclude you from attending and voting at the EGM in person if you
wish.
If you are in any doubt as to what action you should take, you
are recommended to seek your own personal financial advice from
your stockbroker, bank manager, solicitor, accountant or other
independent financial adviser authorised under the Financial
Services and Markets Act 2000 immediately, or, if outside the
United Kingdom, another appropriately authorised financial
adviser.
If you have any questions regarding the Form of Proxy please
contact Capita Asset Services on 0371 664 0321. Calls are charged
at the standard geographic rate and will vary by provider. Calls
outside the United Kingdom will be charged at the applicable
international rate. The helpline is open between 9 a.m. and 5.30
p.m., Monday to Friday excluding public holidays, in England and
Wales. Please note that Capita Asset Services cannot provide any
financial, legal or tax advice and calls may be recorded and
monitored for security and training purposes.
7. RECOMMENDATION
In the Board's opinion, the Proposals are in the best interests
of the Company and its Shareholders as a whole.
Accordingly, your Board unanimously recommends that Shareholders
vote in favour of the Resolutions to be proposed at the
Extraordinary General Meeting, as they intend to do in respect of
their own beneficial holdings which amount to, in aggregate,
1,682,854 Shares (representing 2.3 per cent. of the existing issued
Share capital of the Company as at 7 November 2016, the last
practicable day prior to publication of this Circular).
Yours faithfully
Charles Tracy
Chairman"
Expected timetable of principal events
2016
Announcement and posting of Circular 8 November
Latest time and date for receipt of completed 12 noon on 6 December
Forms of Proxy, electronic proxy appointments
and CREST electronic proxy instructions
for use at the Extraordinary General
Meeting(1)
Record date for participation and voting 6.00 p.m. on 6 December
at the Extraordinary General Meeting
Closing of the Company's register 6.00 p.m. on 7 December
Suspension of listing of and trading 7.30 a.m. on 8 December
in the Shares
Extraordinary General Meeting 12.00 noon on 8 December
Liquidators appointed 8 December
Announcement of results of the Extraordinary 8 December
General Meeting
Cancellation of listing of and trading 8.00 a.m. on 9 December
in the Shares on the Main Market
First distribution to Shareholders(2) January 2017
Each of the times and dates in the expected timetable of
principal events may be extended or brought forward without notice.
If any of the above times and/or dates change, the revised time(s)
and/or date(s) will be notified to Shareholders by an announcement
through an RIS. All references are to London time unless otherwise
stated.
1. Please note that the latest time for receipt of Forms of
Proxy in respect of the Extraordinary General Meeting is 48 hours
(excluding any part of a day which is not a Business Day) prior to
the time allotted for the Extraordinary General Meeting.
2. The Liquidators will make the first distribution (after
providing for the Retention) as soon as practicable following
confirmation of the NAV.
Enquiries
Stockdale Securities Limited 020 7601 6118
Alastair Moreton
Tracey Lago 020 3246 7405
Company Secretary
This information is provided by RNS
The company news service from the London Stock Exchange
END
CIRFSSFIAFMSESF
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November 08, 2016 10:13 ET (15:13 GMT)
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