TIDMENI
RNS Number : 6590F
Edinburgh New Income Trust plc
28 April 2011
28 April 2011
EDINBURGH NEW INCOME TRUST PLC (THE "COMPANY")
PUBLICATION OF CIRCULAR
Further to the announcement made by the Company on 4 April 2011,
the Company has today issued a circular (the "Circular") to its
shareholders ("Shareholders") in connection with recommended
proposals for the winding up and reconstruction of the Company (the
"Proposals").
The Proposals
Under the Proposals, which will be effected by way of a scheme
of reconstruction of the Company under section 110 of the
Insolvency Act 1986, both Ordinary Shareholders and ZDP
Shareholders will be able to elect:
-- to realise some or all of their investment in the Company for
cash (the "Cash Option"); or
-- to roll over some or all of their investment into net income
A class shares in the Aberdeen UK Equity Income Fund (the "Rollover
Option").
The Aberdeen UK Equity Income Fund is a sub-fund of Aberdeen
Investment Funds ICVC, a UK authorised open-ended investment
company. The Fund invests primarily in UK equity and equity-related
securities and aims to achieve an attractive level of income
combined with capital growth. As at 26 April 2011, the Fund had net
assets of approximately GBP157.7 million and an estimated yield of
3.75 per cent.
The Proposals will offer Shareholders (including Unitholders)
the opportunity to retain market exposure and to continue to
receive investment returns without triggering an immediate
liability to tax on capital gains, while avoiding the dealing and
other costs that would be associated with the reinvestment in the
secondary market of the proceeds of liquidation.
Before deciding to offer Shareholders the opportunity to roll
over their investments into shares in the Fund, the Board gave
careful consideration to offering Shareholders a rollover vehicle
similar in structure to the Company, whether in the form of a split
capital investment trust or some other suitably structured closed
ended vehicle. However, after intensive consultation the Board and
its advisers concluded that the increased costs involved in
offering a closed ended alternative to Shareholders (notably, the
high costs involved in the preparation of a prospectus by any
closed ended alternative for the sole purpose of participating in a
rollover) would render such an offering uneconomic.
The Board is nonetheless satisfied that the Fund, albeit a
sub-fund of an open-ended investment company, is a suitable
rollover alternative for Shareholders who wish to continue, in a
tax efficient manner, with an investment portfolio of UK equities
very similar to the UK equity portfolio of the Company but offers
no recommendation in this regard. Over the past two years, the Fund
has been managed by the same members of the Aberdeen investment
team that have managed the Company's portfolio.
ZDP Shareholders should note that the Fund Shares have
investment characteristics which are very different to those of the
ZDP Shares: the Fund Shares carry the right to receive periodic
distributions of income and, in particular, the Fund Shares do not
have a pre-determined capital entitlement. Ordinary Shareholders
should note that, unlike the Company's Ordinary Shares, the Fund
Shares are ungeared.
Whether or not the Proposals become effective, a resolution to
place the Company into members' voluntary liquidation (the
"Liquidation Resolution") will be proposed at the Second General
Meeting, as required under the Articles. In accordance with the
Articles, all Shareholders who vote on the Liquidation Resolution
at the Second General Meeting will be deemed to have voted in
favour of the Liquidation Resolution. The Company will, therefore,
be placed into members' voluntary liquidation on 31 May 2011
whether or not the Proposals become effective.
Shareholders who do not make a valid Election will be deemed to
have elected for the Cash Option in respect of their entire holding
of Shares. Accordingly, Shareholders who wish to receive cash in
respect of their entire holding of Shares need not submit a Form of
Election.
Shareholders who have a registered address (or who are resident
in or citizens of jurisdictions) outside the United Kingdom, the
Republic of Ireland, the Channel Islands and the Isle of Man will
also be deemed to have made an election for cash unless they are
able to satisfy the Company and the authorised corporate director
of the Fund that they are permitted to hold Fund Shares without
breaching the laws of any relevant jurisdictions.
The Circular contains details of the action to be taken by
Shareholders in order to make elections under the Proposals.
Unitholders are reminded that each "Unit" comprises three
Ordinary Shares and one ZDP Share. Accordingly, a Unitholder's
entitlement under the Proposals is simply made up of the separate
entitlements which attach to the individual class of share held
within that Unitholder's Units. That being the case, Unitholders
should note that references in this announcement to "Shareholders"
include Unitholders in respect of the Shares held by them within
their Units.
Final interim dividend
In accordance with the Articles, the Company intends to pay a
final interim dividend to Ordinary Shareholders (including
Unitholders in respect of the Ordinary Shares comprised in their
Units) prior to the winding up of the Company in an aggregate
amount equal to the Company's undistributed revenue reserves and
undistributed net revenues arising in the current financial year up
to the Winding Up Date. The Board will announce the level of the
Final Interim Dividend in due course and it will be paid, prior to
the Scheme becoming effective, to Ordinary Shareholders on the
register of members on 20 May 2011.
Costs of the Proposals
The direct costs of the Proposals which will be borne by the
Company are expected to be approximately GBP260,000. This cost
estimate takes into account that Aberdeen Asset Managers Limited
has agreed, conditional upon the Proposals becoming effective, to
pay a contribution to the costs of the Proposals of GBP50,000. If
the Proposals are not approved by Shareholders, the direct costs of
the Proposals (which include the costs of winding up the Company)
shall nonetheless be met by the Company but Aberdeen Asset Managers
Limited will not make a contribution to the costs of the Proposals.
Accordingly, the costs incurred by the Company are expected to be
approximately GBP310,000 if the Company is simply wound up without
the Proposals being implemented.
General Meetings
The implementation of the Proposals will require Shareholders to
vote in favour of resolutions to be proposed at general meetings of
the Company (the "General Meetings") which have been convened for
10.00 a.m. on 23 May 2011 and 10.00 a.m. on 31 May 2011. The
notices convening the General Meetings, which set out in full the
terms of the resolutions which are to be proposed, are set out in
the Circular. The General Meetings will be held at the offices of
Aberdeen Asset Managers Limited, 7th Floor, 40 Princes Street,
Edinburgh EH2 2BY.
Expected Timetable
2011
Ex-dividend date for Final Interim Dividend 18 May
Record date for Final Interim Dividend 20 May
Latest time and date for receipt of Voting 5.00 p.m. on
Direction Forms in respect of the First 16 May
General Meeting and Letters of Election
from Savings Scheme Participants
Date from which it is advised that dealings 19 May
in Shares should only be for cash settlement
and immediate delivery of documents of
title
Latest time and date for receipt of Forms 10.00 a.m. on
of Proxy from Shareholders in respect of 19 May
the First General Meeting
Final Interim Dividend declared 23 May
First General Meeting 10.00 a.m. on
23 May
Latest time and date for receipt of Forms 11.00 a.m. on
of Election or TTE Instructions from Shareholders 23 May
Latest time and date for receipt of Voting 5.00 p.m. on
Direction Forms in respect of the Second 23 May
General Meeting
Record Date for the calculation of Shareholders' close of business
entitlements under the Scheme on 23 May
Shares disabled in CREST* 7.30 a.m. on
24 May
Latest time and date for receipt of Forms 10.00 a.m. on
of Proxy from Shareholders in respect of 26 May
the Second General Meeting
Shares reclassified as Reclassified Shares 8.00 a.m. on
in the Official List and dealings in Reclassified 27 May
Shares commence**
Calculation Date close of business
on 27 May
Listing of Reclassified Shares on the Official 7.30 a.m. on
List suspended 31 May
Second General Meeting 10.00 a.m. on
31 May
Effective Date for implementation of the 31 May
Scheme and commencement of the liquidation
Dealings commence in Fund Shares issued 2 June
under the Scheme
Contract notes in respect of Fund Shares issued 2 June
under the Scheme despatched to Shareholders (or as soon as
practicable thereafter)
Cheques expected to be despatched and CREST as soon as practicable
payments made to Shareholders in respect following 31
of cash elections under the Scheme May
Cheques expected to be despatched and CREST as soon as practicable
payments made to Savings Scheme Participants following 31
in respect of cash elections under the May
Scheme
Cancellation of listing of Reclassified 8.00 a.m. on
Shares on the Official List** 31 May 2012
* For the avoidance of doubt, the Company's register of members
will remain open until the Effective Date.
** Reclassified Shares are a technical requirement of the Scheme
and will be created if the resolutions to be proposed at the First
General Meeting are passed and become effective.
Each of the times and dates in the expected timetable may be
extended or brought forward without further 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 a
Regulatory Information Service provider. Words and expressions
defined in the Circular have the same respective meanings in this
announcement.
A copy of the Circular has been submitted to the National
Storage Mechanism and will shortly be available for inspection at
http://www.hemscott.com/nsm.do
Enquiries:
Valerie MacKenzie Aberdeen Asset Managers Tel: +44 (0)131
Limited 528 4136
Robin Archibald Winterflood Investment Tel: +44 (0)20
Trusts 3100 0290
Robert Peel Winterflood Investment Tel: +44 (020)
Trusts 3100 0291
This information is provided by RNS
The company news service from the London Stock Exchange
END
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