TIDMSIGT
RNS Number : 8475G
Momentum Multi-Asset Value Trust
21 July 2023
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION DIRECTLY OR
INDIRECTLY (IN WHOLE OR IN PART) IN, INTO OR FROM ANY JURISDICITON
WHERE TO DO SO WOULD COSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF THE JURISDICITON.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATON FOR THE PURPOSES OF
ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS
PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION
(WITHDRAWAL) ACT 2018, AS AMED. ON THE PUBLICATION OF THIS
ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INSIDE
INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
21 July 2023
Momentum Multi-Asset Value Trust plc (the "Company")
Publication of Circular
Further to the Company's announcement of 25 May 2023, in which
the proposals for the recommended scheme of reconstruction and
voluntary winding-up of the Company were set out (the "Proposals"),
the Board is today publishing a circular (the "Circular") in
connection with the Proposals, which includes notices convening the
required general meetings. Terms used in this announcement but not
otherwise defined shall bear the same meanings as are set out in
the Circular.
Introduction
Recent market challenges and share buy backs through the
operation of the Company's discount control mechanism ("DCM") have
seen the Company reduce in size, to net assets of around GBP40
million (as at the Latest Practicable Date), and its ongoing
charges ratio increase. This has put the long-term viability of the
Company in question and the Board has decided it is in the best
interests of Shareholders as a whole to liquidate the Company and
give Shareholders the option to roll their investment into VT
Momentum Diversified Income Fund (the "ICVC Sub-Fund"), a sub-fund
of VT Momentum Investment Funds II (the "ICVC"), an open-ended
vehicle, or to receive a cash exit at close to NAV.
The Board is today putting forward proposals to Shareholders for
the winding-up of the Company by way of a scheme of reconstruction
pursuant to Section 110 of the Insolvency Act 1986 (the "Scheme").
Under the terms of the Scheme, Shareholders will be offered the
opportunity to roll over their investment into the ICVC Sub-Fund,
an open-ended fund also managed by Momentum Global Investment
Management Limited (the "Investment Manager"), or to receive cash
in respect of their investment in the Company, or a combination of
both (the "Proposals").
The opportunity to roll over into the ICVC Sub-Fund will provide
Shareholders with the ability to maintain a consistent investment
approach. The ICVC Sub-Fund is managed by the Investment Manager
and has the same valuation-driven philosophy as the Company. The
ICVC Sub-Fund has similar investment objectives to the Company and
there is a material overlap of portfolio holdings. The ICVC
Sub-Fund aims to generate a high level of income with the prospect
of maintaining the real value of capital over the long term, by
investing in a multi-asset portfolio. It is larger than the
Company, with net assets of around GBP135 million (as at the Latest
Practicable Date), and benefits from a lower ongoing charges ratio
and a higher yield.
The options
Shareholders may elect, in whole or in part and in accordance
with their personal investment requirements, for either or both of
the following options:
-- the Rollover Option - rolling over some or all of their
investment into ICVC Shares to be issued by the ICVC Sub-Fund;
and/or
-- the Cash Option - receiving cash in the liquidation of the
Company in respect of some or all of their investment in the
Company.
Shareholders (other than Restricted Shareholders) that make no
Election (or no valid Election) will be deemed to have elected for
ICVC Shares.
The Proposals
Under the Proposals, the Company will be wound up on the
Winding-up Date by means of a members' voluntary liquidation
pursuant to a scheme of reconstruction under Section 110 of the
Insolvency Act 1986 and Shareholders may elect to receive ICVC
Shares in the ICVC Sub-Fund (being VT Momentum Diversified Income
Fund) and/or cash in respect of all or part of their holding of
Ordinary Shares in the Company. Shareholders who elect to roll over
their investment into the ICVC Sub-Fund will receive ICVC Shares
and, in consideration of such issue, the Company will transfer a
portion of its net assets to the ICVC (for the benefit of the ICVC
Sub-Fund). In this way, it is envisaged that UK resident
Shareholders will be given a tax-efficient rollover of their
entitlements.
The ICVC Shares will be issued at the prevailing net asset value
per ICVC Share as at 12.00 noon on the Effective Date.
Shareholders who elect for the Cash Option will be sent a cheque
(although the Directors reserve the right to send an electronic
payment if the amount is in excess of GBP250,000) in respect of
their entitlement if they hold Ordinary Shares in certificated form
or receive payment through CREST in respect of their entitlement if
they hold Ordinary Shares in uncertificated form.
Shareholders' approval is required to implement parts of the
Proposals which will involve the reclassification of the Company's
existing Ordinary Shares to give effect to the respective options
for which each Shareholder has elected, the voluntary winding-up of
the Company and the appointment of the Liquidators.
Benefits of the Proposals
The Directors consider that the Proposals should have the
following benefits for Shareholders as a whole as compared to their
current position, or under a liquidation:
-- they enable Shareholders to roll over some or all of their
investment into the ICVC Sub-Fund, which aims to generate a high
level of income with the prospect of maintaining the real value of
capital over the long term, by investing in a multi-asset portfolio
managed with a focus on value which may include directly invested
UK equities with a bias towards mid-cap stocks, and overseas
equities, fixed income, specialist assets and managed liquidity
held through third party funds;
-- Shareholders electing for the Rollover Option will not suffer
the full dealing costs that would be incurred on the realisation of
the Company's portfolio in the event of a simple winding-up and
reinvesting the cash proceeds; and
-- Shareholders who may be subject to UK capital gains tax or
corporation tax on chargeable gains should be able to roll over
their investment into the ICVC Sub-Fund and thereby continue to
receive investment returns without triggering an immediate
liability to UK capital gains tax or corporation tax on chargeable
gains.
Shareholders who elect for the Cash Option in respect of some or
all of their investment will receive cash in the liquidation of the
Company to the extent of their Election for the Cash Option.
Shareholders should note that, depending on their particular
circumstances, this may trigger a chargeable gains tax liability.
Please refer to the paragraph headed "Taxation" in Part 4 of the
Circular for further details.
Shareholders who are in any doubt as to the contents of this
announcement or the Circular or as to the action to be taken should
immediately seek their own personal financial advice from an
appropriately qualified independent adviser authorised pursuant to
the Financial Services and Markets Act 2000.
Entitlements of Shareholders under the Scheme
A Shareholder who elects to roll over all or part of their
investment into the ICVC Sub-Fund will be entitled to receive such
number of ICVC Shares as is produced by dividing the proportion of
the value of the ICVC Rollover Pool (less any stamp duty or SDRT
payable on the transfer of the ICVC Rollover Pool to the ICVC
Sub-Fund) to which he/she/it is entitled by the ICVC Share
Subscription Price (further details are set out in Part 2 of the
Circular, in particular, in paragraph 7.3 therein). The
appropriation of the Company's assets to the ICVC Rollover Pool
will occur on the Calculation Date and will be based on the
Residual Net Asset Value per Share multiplied by the aggregate
number for the Rollover Option. As the appropriation of the
Company's assets to the ICVC Rollover Pool will occur on the
Calculation Date, the value of Shareholders' entitlements may be
adversely affected by movements in the value of the assets
contained in the ICVC Rollover Pool between the Calculation Date
and the Effective Date.
A Shareholder who elects for the Cash Option will be entitled to
receive the net realisation proceeds of such portion of the Cash
Pool to which he/she/it is entitled. The appropriation of the
Company's assets to the Cash Pool will occur on the Calculation
Date and will be based on the Residual Net Asset Value per Share
multiplied by the aggregate number of Ordinary Shares in respect of
which Shareholders have elected (or are deemed to have elected) for
the Cash Option. As the appropriation of the Company's assets to
the Cash Pool will occur on the Calculation Date, the value of
Shareholders' entitlements may be adversely affected by movements
in the value of the assets contained in the Cash Pool between the
Calculation Date and the date of payment and cheque despatch in
respect of entitlements under the Cash Option (expected to be not
later than 10 Business Days from the Effective Date).
The Residual Net Asset Value per Share for these purposes is an
amount equal to the Company NAV at the Calculation Date minus the
Retention amount and after providing for the liabilities to be
discharged out of the Liquidation Pool to the extent not already
taken into account as a liability in respect of the Company NAV or
the Retention, divided by the number of Ordinary Shares in issue.
The number of ICVC Shares to be issued to the Liquidators pursuant
to the Scheme (as nominees for the relevant Shareholders) will be
calculated by reference to the ICVC Share Subscription Price.
Further details regarding the number of ICVC Shares to be issued
pursuant to the Scheme are set out in Part 2 of the Circular.
For illustrative purposes only , had the Calculation Date been
18 July 2023, the Directors estimate that the Residual Net Asset
Value per Share would have been 149.21p. This is based on the
following figures and estimates: the net assets of the Company as
at 18 July 2023 (published on 19 July 2023) which were
approximately GBP40,550,000 minus the anticipated costs of the
Proposals and of liquidating the Company, estimated at
approximately GBP290,000 (including VAT), other potential
liabilities to be discharged from the Liquidation Pool estimated at
approximately GBP0 and the retention anticipated to be required by
the Liquidators (to meet contingent and unknown liabilities) of
GBP100,000.
Based on the illustrative Residual Net Asset Value per Share set
out above, and assuming: (i) that there is no change in those net
assets between 18 July 2023 and the Effective Date; (ii) that the
revaluation of the ICVC Rollover Pool on the Effective Date results
in the same valuation as that performed on the Calculation Date;
(iii) that ICVC Shares are issued at 97.4919p (being the ICVC Share
Subscription Price); and (iv) that the assets in the Cash Pool are
realised at their value on the Calculation Date, this would give
rise to the following entitlements for every 1,000 Ordinary Shares
held under the Proposals:
-- 1,525.049 ICVC Shares; or
-- GBP1,492.10 in cash.
The minimum subscription amount set out in the ICVC Prospectus
will be waived in respect of Shareholders who elect, or are deemed
to elect, for the Rollover Option.
The above figures are for illustrative purposes only and do not
represent forecasts. The Residual Net Asset Value per Share and
Shareholders' entitlements under the Proposals may change
materially up to the Effective Date as a result of, inter alia,
changes in the value of the Company's investments.
For details of the Scheme, please refer to Part 2 of the
Circular.
Interim Dividend
In relation to the period from 1 May 2023 to 18 July 2023, as
announced on 20 July 2023, the Directors have resolved that the
Company will pay an interim dividend of 2.5 pence per Ordinary
Share (the "Interim Dividend") in order to ensure that the Company
meets the distribution requirements to maintain investment trust
status during the period from 1 May 2023 to the Winding-up Date.
This compares to an interim dividend of 1.8 pence per Ordinary
Share paid by the Company in September 2022 in respect of the first
quarter of its financial year to April 2023. The Interim Dividend
will be paid on 18 August 2023 to Shareholders who are on the
Register as at 6.00 p.m. on 28 July 2023. The ex-dividend date for
the Interim Dividend is 27 July 2023.
Expected Timetable
2023
Ex-dividend date for the Interim Dividend 27 July
Interim Dividend Record Date 6.00 p.m. on 28 July
Latest time and date for receipt of Forms of Proxy from 10.00 a.m. on 11 August
Shareholders for the First General
Meeting
Latest time and date for receipt of the Forms of Election 1.00 p.m. on 11 August
and/or TTE Instructions from Shareholders
wishing to elect for the Cash Option
Scheme Entitlements Record Date 6.00 p.m. on 11 August
Ordinary Shares disabled in CREST 6.00 p.m. on 11 August
First General Meeting 10.00 a.m. on 15 August
Calculation Date 11.59 p.m. on 17 August
Payment of the Interim Dividend 18 August
Latest time for receipt of Forms of Proxy from Shareholders 10.00 a.m. on 21 August
for the Second General Meeting
Reclassification of the Ordinary Shares 8.00 a.m. on 22 August
Suspension of dealings in Reclassified Shares 7.00 a.m. on 23 August
Second General Meeting 10.00 a.m. on 23 August
Appointment of the Liquidators 23 August
Effective Date and Transfer Agreement executed and 23 August
implemented
ICVC Shares issued pursuant to the Scheme 23 August
First day of dealing in ICVC Shares 23 August
Contract notes expected to be despatched in respect of ICVC Week commencing 28 August
Shares issued pursuant to the
Scheme
Cheques expected to be despatched and CREST payments made Not later than 10 Business Days from the Effective Date
to Shareholders in respect of the
Cash Option
Cancellation of listing of Reclassified Shares As soon as practicable after the Effective Date
The times and dates set out in the expected timetable of events
above and mentioned throughout this announcement may be adjusted by
the Company in which event details of the new times and dates will
be notified, as requested, to the Financial Conduct Authority, the
London Stock Exchange and, where appropriate, Shareholders. All
references to time in this announcement are to UK time .
A copy of the Circular will be submitted to the National Storage
Mechanism and will shortly be available for inspection at
https://data.fca.org.uk/ # /nsm/nationalstoragemechanism . The
Circular will also be available on the Company's website
https://momentum.co.uk/investment-trust and at the registered
office of the Company (Level 4, Dashwood House, 69 Old Broad
Street, London, England, EC2M 1QS).
Enquiries:
Juniper Partners Limited, Company Secretary
0131 378 0500
Steve Hunter, Momentum Global Investment Management Limited
0151 906 2481
Sally Walton, SEC Newgate (media enquiries)
020 3757 6872
Legal Entity Identifier: 213800OQTUSRFDIL9L29
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END
CIRSEAFDFEDSEDW
(END) Dow Jones Newswires
July 21, 2023 09:41 ET (13:41 GMT)
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