AIDE Aida FD Eur

 

TIDMAIDP TIDMAIDU TIDMAIDE 
 
RNS Number : 4836U 
Aida Fund Limited 
25 June 2009 
 

Not for release, publication or distribution, in whole or in part, in or into or 
from Australia, Canada, Japan, South Africa or the United States or any other 
jurisdiction where such release, publication or distribution would constitute a 
violation of the relevant laws or regulations of such jurisdiction 
25 June 2009 
The Aida Fund Limited 
Preliminary announcement of proposals to establish an open ended fund, improve 
the liquidity profile of the portfolio and restructure the Aida Fund 
Introduction 
  *  The Aida Fund is developing proposals to reflect the change in market 
  conditions and circumstances since it was first listed.  The proposals will 
  improve the liquidity profile of the portfolio and provide eligible investors 
  with the choice of holding their investment in an open ended or a closed ended 
  format.A circular providing full details of the proposals and requisitioning the 
  necessary shareholder meetings is expected to be posted within 30 days. 
 
General 
  *  The Aida Fund continues to offer an attractive investment proposition, providing 
  access for investors to a diversified portfolio of some of the best investment 
  funds in the market whilst enforcing a rigorous and disciplined approach to risk 
  management and fund selection. 
  *  The portfolio comprises investments in substantial hedge funds with strong long 
  term track records across a broad range of investment strategies. 
  *  The Aida Fund has been reducing the leverage used for investment purposes since 
  December 2008. It is expected that such leverage will have been eliminated by 30 
  June 2009 and will not be reinstated. 
  *  The estimated year to date performance to the end of May of the Aida Fund's US 
  Dollar denominated share class is (0.10) per cent. 
 
Overview of the Proposals 
  *  The proposals, which are subject to regulatory approval, include 
  providing eligible investors with choice as to how they can hold their 
  investment by the formation of a new open ended vehicle which will be called The 
  Aida Open Ended Fund Limited in addition to the existing closed ended Aida Fund. 
 
  *  The core existing assets of the Aida Fund will be transferred to the Aida Open 
  Ended Fund which will make all future investments. The investment policy will be 
  substantially in line with the existing investment policy of the Aida Fund. 
  *  The Aida Open Ended Fund will only invest in underlying funds which have, at a 
  minimum, an annual liquidity opportunity at the time the investment is made. 
  *  Those investments within the current portfolio that are not expected to meet the 
  new liquidity criteria will be transferred to a separate 'side-pocket'. 
  *  Eligible existing shareholders will be provided with an opportunity to elect to 
  transfer their investment in the Aida Fund to the Aida Open Ended Fund. 
  *  A shareholder in the Aida Open Ended Fund will be able on a quarterly basis to 
  elect to redeem all or a proportion of their investment at realisable net asset 
  value (being the cash received from the underlying investments) less applicable 
  costs.  On receipt of a redemption request, Aida Capital will partition a 
  pro-rated share of the underlying investments, redeem the investments and return 
  cash to the redeeming shareholder in stages once received from redeeming the 
  investments.  The directors will have the discretion to provide shareholders 
  with monthly rather than quarterly elections. 
  *  The existing Aida Fund will continue as a closed ended fund and will become a 
  feeder into the Aida Open Ended Fund for those shareholders for whom there are 
  advantages in investing in such a structure.  It is intended that it will 
  continue to be listed and traded on the London Stock Exchange. Its name will be 
  changed to The Aida Closed Ended Fund Limited.  The Aida Closed Ended Fund will 
  invest all or substantially all of its investment funds in shares in the Aida 
  Open Ended Fund. 
  *  The Aida Open Ended Fund and the Aida Closed Ended Fund will only offer a US 
  Dollar currency class and the existing Euro and Sterling share classes in the 
  Aida Closed Fund will be converted to the US Dollar share class. The investment 
  portfolio is invested in US Dollars. Currency hedging attributable to the Euro 
  and Sterling currency share classes results in the potential requirement to 
  convert the most liquid assets in the investment portfolio into cash to settle 
  currency hedging commitments. Such hedging activity therefore has the potential 
  to affect the balance and liquidity profile of the investment portfolio. 
  *  There will be a flat management fee (charged only at the Aida Open Ended Fund 
  level and not at the Aida Closed Ended Fund level) and no performance fee. 
 
Further details of the Aida Open Ended Fund. 
The Aida Open Ended Fund's principal investment objective will be to achieve 
capital growth through investment in a diverse series of investment funds and 
will be substantially in line with the Aida Fund's current investment policy. 
Key characteristics of the Aida Open Ended Fund will include: 
An enhanced underlying liquidity profile 
The Aida Open Ended Fund will only invest in underlying funds which have, at 
least, an annual liquidity opportunity. 
The Aida Open Ended Fund will operate guidelines with respect to limits on the 
liquidity profile of its portfolio of underlying funds as follows: 
  *  a minimum of 30 per cent by value will offer redemption opportunities within 30 
  days of notice being given to the underlying fund; and 
  *  a minimum of a further 30 per cent by value will offer redemption 
  opportunities within 90 days of notice being given to the underlying fund; and 
  *  the balance will offer redemption opportunities on at least an annual basis. 
 
It is expected that the guidelines will be met by the first quarter of 2010. 
Providing shareholders with the opportunity on a quarterly basis to convert to a 
redemption share class 
Holders of ordinary shares in the Aida Open Ended Fund will be able to convert 
some or all of their ordinary shares into redemption shares on a quarterly basis 
(or monthly at the discretion of the directors) upon giving not less than 45 
days notice and subject to a minimum value of redemption elections being 
received. 
On any quarter date on which ordinary shares are converted into redemption 
shares the pro-rata proportion of the Aida Open Ended Fund's portfolio of assets 
attributable to such ordinary shares will be notionally allocated to the 
redemption shares to be issued on that date. 
Aida Capital will then redeem the underlying assets attributable to 
such redemption shares.  Upon cash being received by the Aida Open Ended Fund 
from the realisation of these assets it will be paid to the holders of 
such redemption shares net of costs and expenses. The first such payment will be 
made after approximately 45 days of such redemption shares being issued. 
Payments will be made thereafter on a staged basis as the underlying assets are 
realised. 
To the extent that the Aida Open Ended Fund receives subscription money from 
investors wishing to acquire ordinary shares as well as redemption notices from 
investors seeking to dispose of ordinary shares Aida Capital may use such 
subscription money to redeem such ordinary shares at net asset value less costs. 
Similarly Aida Capital may allocate an amount of subscription money equal to the 
net asset value of the assets attributable to a redemption class less costs and 
reallocate the assets to the ordinary shares. 
At the absolute discretion of the directors and the investment manager and 
subject to the agreement of the underlying funds a shareholder may request via 
the redemption process that upon the relevant redemption date the portion of the 
Aida Open Ended Fund's assets relating to the ordinary shares that they have 
elected to convert to redemption shares will be transferred to them. If this is 
not possible they will receive the appropriate number of redemption shares. 
The directors will have the discretion to provide shareholders with the ability 
to elect to convert ordinary shares to redemption shares on a monthly rather 
than quarterly basis. 
Separation of assets that are not expected to satisfy the new liquidity criteria 
Investments within the current portfolio that are not expected to meet the new 
liquidity criteria as outlined above will be transferred to a 
separate side-pocket and a class of shares attributable to such side-pocket 
which will held by investors who are shareholders in the Aida Open Ended Fund 
(including the Aida Closed Ended Fund) when the proposals are implemented. 
Shareholders will not be entitled to redeem their side-pocket shares, or to 
convert such side-pocket shares into redemption shares. However as the assets in 
the side-pocket class are realised side-pocket shares will be converted into 
ordinary shares. 
Aida Capital estimates that, initially, assets representing approximately 20 per 
cent of the net asset value of the Aida Fund will be held within the side-pocket 
share class.  It is estimated that these assets will be redeemed as to 20 per 
cent by June 2010, 40 per cent by June 2011 and the balance by 2015. 
Single currency class 
To ensure that the funds do not become unbalanced due to currency movements and 
the potential requirement to liquidate assets to make payments in connection 
with such currency hedging the Aida Open Ended Fund will only have US Dollar 
denominated shares in issue. 
Transfer to the Aida Open Ended Fund from the Aida Closed Ended Fund 
Eligible shareholders who wish to transfer their investment from the Aida Closed 
Ended Fund to the Aida Open Ended Fund (by redeeming their shares in the Aida 
Closed Ended Fund in return for a transfer to them of shares in the Aida Open 
Ended Fund) will be provided with an opportunity to do so upon or shortly after 
the proposals become effective. 
Subsequent to this eligible shareholders may request that, at the absolute 
discretion of the directors, they be permitted to convert their shareholding 
from the Aida Closed Ended Fund to the Aida Open Ended Fund. 
Transfer to the Aida Closed Ended Fund from the Aida Open Ended Fund 
Shareholders may elect to transfer their shareholding from the Aida Open Ended 
Fund to the Aida Closed Ended Fund on any quarter day by giving not less than 45 
days notice. 
Listing 
The Aida Open Ended Fund will seek a listing on the Channel Islands Stock 
Exchange. 
Fees 
The will be no performance fees charged.  The fee structure for the Aida Open 
Ended Fund will comprise management fees based on net asset value. 
Further details of the Aida Closed Ended Fund - the existing corporate entity 
The Aida Closed Ended Fund will act solely as a feeder fund for the Aida Open 
Ended Fund and, hence, will invest all of its investment funds in the shares of 
the Aida Open Ended Fund. 
Investment policy 
The investment policy of the Aida Closed Ended Fund will be to invest all or 
substantially all of its assets in the Aida Open Ended Fund to gain exposure to 
the Open Ended Fund's investment strategy, which will be substantially similar 
to the Aida Fund's existing investment policy. 
Side-pocket shares 
As noted above, the Aida Closed Ended Fund will as a result of the 
implementation of the proposals hold side-pocket shares (as well as ordinary 
shares) in the Aida Open Ended Fund. Accordingly, existing shareholders in the 
Aida Closed Ended Fund will also following implementation of the proposals hold 
ordinary shares and side-pocket shares in the Aida Closed Ended Fund. 
Continuation vote 
The articles of incorporation will be amended to require the Directors to 
convene an extraordinary general meeting of the Aida Closed Ended Fund, the 
first of which will be held at the end of 2015 (or earlier if such an 
extraordinary general meeting is requisitioned by shareholders holding not less 
than 10 per cent of the issued share capital of the Aida Closed Ended Fund), and 
thereafter at five yearly intervals, at which a resolution will be put to 
shareholders to continue the Aida Closed Ended Fund. 
This will replace the Aida Closed Ended Fund's existing discount floor 
provision, which requires a continuation vote to be put to shareholders if the 
shares in the Aida Closed Ended Fund trade below a certain discount during its 
financial year, and will thereby provide what the board believes to be a more 
flexible and appropriate basis for the continued operation of the Aida Closed 
Ended Fund following implementation of the proposals. 
Liquidity 
Shareholders in the Aida Closed Ended Fund will continue, as now, to have no 
right to require redemption of their shares. Shareholders who wish to realise 
their ordinary shares otherwise than pursuant to the winding up of the Closed 
Ended Fund may be able to do so by selling their ordinary shares in the open 
market. The directors may also elect to buy back ordinary shares at such price 
and on such terms as they may in their absolute discretion determine, provided 
always that the purchase price for an ordinary share is lower than the then 
prevailing net asset value per ordinary share. 
Side-pocket shares in the Aida Closed Ended Fund will not be listed or traded on 
the London Stock Exchange. Such side-pocket shares will be converted into 
ordinary shares in the Closed Ended Fund as side-pocket shares in the Aida Open 
Ended Fund held by the Aida Closed Ended Fund are converted into ordinary shares 
in the Aida Open Ended Fund. 
Eligible shareholders may request that, at the absolute discretion of the 
directors, they be permitted to convert their shareholding from the Aida Closed 
Ended Fund to the Aida Open Ended Fund. 
Conversion to a single currency class 
To ensure that the Aida Closed Ended Fund does not become unbalanced due to 
currency movements and the potential requirement to liquidate assets to make 
payments in connection with such currency hedging both the Euro and Sterling 
shares will be converted into US Dollar denominated shares which will be the 
only class in issue. 
Listing 
It is intended that the ordinary shares of Aida Closed Ended Fund will continue 
to be listed and traded on the London Stock Exchange. 
Circular to shareholders 
The directors and their advisers are continuing to develop the proposals to 
enable them to be put to shareholders.  A circular outlining the proposals and 
containing notices convening the relevant shareholder meetings is expected to be 
posted to shareholders within 30 days. 
Takeover Code considerations 
The UK Takeover Code (the "Code") applies to the Aida Closed Ended Fund. Under 
Rule 9 of the Code, any person who acquires an interest (as such term is defined 
in the Code) in shares which, taken together with shares in which he and persons 
acting in concert with him are interested, carry 30 per cent. or more of the 
voting rights of a company which is subject to the Code is normally required to 
make a general offer to all of the remaining shareholders to acquire their 
shares. Similarly, when any person, together with persons acting in concert with 
him, is interested in shares which in aggregate carry not less than 30 per cent. 
but does not hold shares carrying more than 50 per cent. of the voting rights of 
such company, a general offer will normally be required if any further interests 
in shares are acquired by any such person.  Such an offer would have to be made 
in cash at a price not less than the highest price paid by him, or by any member 
of the group of persons acting in concert with him, for any interest in shares 
in the company during the 12 months prior to the announcement of the offer. 
Under Rule 37.1 of the Code, any increase in the percentage holding of a 
shareholder which results from a company redeeming its own shares is also 
treated as an acquisition for the purposes of Rule 9 of the Code.  This would 
ordinarily mean that the redemption of shares in the Aida Closed Ended Fund in 
exchange for the transfer of shares in the Aida Open Ended Fund pursuant to an 
election by an existing shareholder in the Aida Closed Ended Fund to switch his 
investment to the Aida Open Ended Fund could (except in the case of a 
shareholder who elects to exchange a proportion of his shares at least equal to 
the overall proportion of shares in the Aida Closed Ended Fund in respect of 
which switching requests are received by the Aida Closed Ended Fund) result in 
such shareholder being obliged to make an offer for the remaining shares in the 
Aida Closed Ended Fund. 
However, the UK Takeover Panel (the "Panel") has confirmed to the Aida Closed 
Ended Fund that: 
(a)except in the case of a shareholder who is a director or the investment 
manager of the Aida Closed Ended Fund (or whose relationship with the investment 
manager or any one or more directors is such that the shareholder is, or is 
presumed to be, acting in concert for the purposes of the Code with any of the 
directors or the investment manager), a shareholder will, subject to (b) below, 
not be required to make an offer for the remaining shares in the Aida Closed 
Ended Fund if as a result of the implementation of the proposals he holds an 
interest in shares in the Aida Closed Ended Fund which carry 30 per cent. or 
more of the voting rights in the Aida Closed Ended Fund (although a shareholder 
should contact the Panel if this situation occurs); and 
(b)A shareholder will not be able to rely on (a) above if he acquires further 
interests in shares at a time when he knew or, as a result of public statements 
as to the intentions of any other shareholder(s), ought reasonably to have 
known, that such acquisition would result in his being interested following 
implementation of the proposals in shares carrying 30 per cent or more of the 
voting rights in the Aida Closed Ended Fund. In the event of any doubt 
shareholders should contact the Panel. 
Shareholders who do not elect to exchange all of their shares in the Aida Closed 
Ended Fund for shares in the Aida Open Ended Fund should note that subsequent to 
the implementation of the proposals, they will be subject, in acquiring further 
interests in shares in the Aida Closed Ended Fund, to the provisions of Rule 9 
of the Code.  For these purposes the percentage of voting rights in which a 
shareholder will be interested will be calculated by reference to the number of 
shares in the Aida Closed Ended Fund in issue following implementation of the 
proposals.  Consequently, if as a result of the implementation of the proposals 
a shareholder (together with persons acting in concert with him) is interested 
in shares in the Aida Closed Ended Fund which in aggregate carry not less than 
30 per cent. but does not hold shares in the Aida Closed Ended Fund carrying 
more than 50 per cent. of the voting rights in the Aida Closed Ended Fund, and 
such shareholder subsequently acquires any further interests in shares in the 
Aida Closed Ended Fund, he may be required to make a general offer for the 
remaining shares in the Aida Closed Ended Fund pursuant to Rule 9 of the Code. 
 
 
 
 
 
 
+-----------------------------------------------+------------------------------+ 
| Enquiries:                                    |                              | 
+-----------------------------------------------+------------------------------+ 
| Aida Capital                                  | +44 20 7600 7500             | 
| Nicholas Oppenheim                            |                              | 
| Colin Clark                                   |                              | 
+-----------------------------------------------+------------------------------+ 
|                                               |                              | 
+-----------------------------------------------+------------------------------+ 
 
 
This press announcement is for information only and should be read in connection 
with the full details of the proposals to be published in the circular to be 
sent to shareholders before making any investment decision.  The proposals will 
be subject to the approval of the relevant regulatory bodies. 
Any offer contained in this press announcement to exchange shares in the Aida 
Closed Ended Fund for shares in the Aida Open Ended Fund is directed only at (i) 
persons outside the United Kingdom to whom it is lawful to communicate it; (ii) 
persons having professional experience in matters relating to investments who 
fall within the definition of "investment professionals" in Article 19(5) of the 
Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the 
"Order"); (iii) high net worth bodies corporate, unincorporated associations and 
partnerships and trustees of high value trusts as described in Article 49(2) of 
the Order; or (iv) any other person in the United Kingdom to whom it is lawful 
to communicate it (each a "Relevant Person").  Any person who is not a Relevant 
Person will be unable to exchange shares in the Aida Closed-Ended Fund for 
shares in the Aida Open-Ended Fund. Any person applying to exchange shares in 
the Aida Closed Ended Fund for shares in the Aida Open-Ended Fund will be 
required to represent and agree that they are a Relevant Person. 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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