Requisition Up-date

21 April 2016

ATLANTIS JAPAN GROWTH FUND LIMITED

Requisition Up-date

The Board notes the announcement by LIM Advisors Limited on 19 April 2016.

The Board believes the substance of the argument for continuing the Company with its closed-end structure remains unchanged and reaffirms its commitment to a number of key changes which are expected to help drive the long-term performance and enhance the appeal of the Company:

·                Taeko Setaishi, deputy fund adviser to the Company since 1996 and the highly rated lead fund adviser to Atlantis Japan Opportunities Fund, is appointed lead fund manager with effect from 1 May 2016.

·                AIRC (the Company’s Tokyo-based investment adviser) and Tiburon (the Company’s London-based investment manager) have committed to a closer day-to-day working relationship with the objective of achieving more proactive and effective communication with shareholders and marketing of the Company to potential new investors.

In addition a, continuation vote (i.e. an ordinary resolution to continue the Company) will be proposed at the Company's annual general meeting in Q4 2019, following the expiry of the annual 1:5 embedded subscription right mechanism.  This mechanism was introduced in 2014 to allow the Company to increase its market capitalisation and total assets, as well as decrease its expense ratio.  The decision to have a continuation vote at the 2019 AGM reflects the Board’s confidence that the measures that it is implementing will be successful in improving the Company's investment performance, narrowing the Share price discount and providing a platform for the growth of the Company.

As previously stated, Ms. Setaishi will continue to pursue the Company's existing investment objective and policy of targeting the less well-covered small and mid-cap universe of Japanese equities. The Company will be managed with more of a conviction-led approach, holding c.65 stocks in contrast to the historical range of c.80-90, coupled with a bottom-up stock selection process and a growth style tilt.

Ms. Setaishi has a long history of generating impressive returns and, over the 5 year period ended 31 March 2016, her Atlantis Japan Opportunities Fund outperformed its benchmark (TOPIX TR) by +129 percentage points and the AIC Japanese Smaller Companies sub-sector average by +75 percentage points.

The Board notes LIM’s suggestion of a roll-over opportunity into an open-ended vehicle and rejects this proposal as it fundamentally undervalues the benefits of a closed-end structure:

·                The Company has, and will continue to have, a bias towards investing in small to mid-cap assets and the closed-end structure provides a stable pool of capital which allows the fund manager to do this without having to manage significant inflows and outflows of cash, and therefore target some less liquid stocks that Ms. Setaishi may find attractive but is not able to hold in her open-ended fund for liquidity reasons.

·                In addition, the ability to use gearing (borrowing for investment purposes) gives Ms. Setaishi additional flexibility to seek superior investment returns; for example to take advantage of new investment opportunities without being forced to realise existing investments that she considers still hold value.

The Board notes that Pensions & Investment Research Consultants Ltd (PIRC), Glass, Lewis & Co., LLC (Glass Lewis) and Institutional Shareholder Services, Inc. (ISS), the independent shareholder advisory groups, all recommend that Shareholders VOTE AGAINST LIM'S RESOLUTION.

The Board unanimously recommends that Shareholders VOTE AGAINST LIM'S RESOLUTION at the extraordinary general meeting of the Company to be held on 3 May 2016.

Shareholders are reminded that the latest time and date for receipt of completed Forms of Proxy and CREST electronic proxy instructions for use at EGM is 2.30 p.m. on Sunday, 1 May 2016 (the "Voting Deadline"). 

Investors who hold their Shares through a non-discretionary broker, manager or other adviser, or via an execution-only platform, should ensure that they submit their voting instructions to their broker, manager or other adviser, or platform, at least several days in advance of the Voting Deadline so that their votes can be cast on the resolution to be proposed at the EGM.

Noel Lamb, Chairman of Atlantis Japan Growth Fund, said: "The change of lead fund manager to Taeko reflects the Board’s acknowledgement that there is room for improvement in the Company’s performance, alhough we note that the Company's performance has been in line with its peers for the most part and also that its discount has been narrower.

"We have already been pro-active in managing the Company’s discount.  In 2013, we introduced the discount control mechanism and this has helped limit the Company’s discount to an average of 8.0%, narrower than the average discount for its peer group of 9.5%.

"The Board firmly believes that the measures outlined in our circular on 7 April 2016 will be key to narrowing the share price discount and ultimately growing the Company.  That is why the Board is introducing the continuation vote at the 2019 AGM.

"On behalf of the Board I’d like to reiterate our recommendation that Shareholders VOTE AGAINST LIM’S RESOLUTION on 3 May as it is not in the best interests of Shareholders as a whole.”

Enquiries

Sue Inglis	Cantor Fitzgerald Europe	T: [phone]
James Alexander	Aravis Partners	T: [phone]
David Masters / Henrietta Guthrie	Lansons	T: [phone] T: [phone]
Rebecca Booth	Northern Trust International Fund Administration Services (Guernsey) Limited	T: [phone] Email: [e-mail]

Notes

A circular explaining the Board's reasons for recommending Shareholders to VOTE AGAINST LIM'S RESOLUTION and containing the notice convening the extraordinary general meeting of the Company, which will be at the offices of Stephenson Harwood LLP, 1 Finsbury Circus, London EC2M 7SH (commencing at 2.30 p.m.), was posted to Shareholders on 7 April 2016.  Copies of that circular are available at www.atlantisjapangrowthfund.com and at www.morningstar.co.uk/uk/nsm.  Words and expressions defined in that circular have the same meanings when used in this announcement.