Alliance Trust PLC : Circular - Response to Ell...

Alliance Trust PLC : Circular - Response to Elliott Requisition

26 March 2015

Alliance Trust publishes Circular to shareholders and responds to Elliott Advisors (UK) Ltd.'s requisitioned resolutions

Further to the announcement made by Alliance Trust PLC confirming receipt of a requisition notice from Elliott Advisors (UK) Ltd. on 16 March 2015, the Company has today published a Circular containing both a short, and more detailed letter from the Chair to shareholders and a statement from Elliott which the Company is also required to send to shareholders. The resolutions will be discussed and voted upon at the Company's forthcoming Annual General Meeting in Dundee, on Wednesday 29 April 2015. The letter details the Board's response to Elliott's resolutions and its voting recommendation.

Highlights from the Circular are as follows:
 
  • The Board believes that Elliott has plans for disruptive actions and that Elliott's proposal is not just about nominating directors.
     
  • Elliott's interests are at odds with the Company's other shareholders - the Board believes that Elliott is looking to exit their shareholding quickly
     
  • The Board considers that the proposed directors are not independent
     
  • The Company already has a clear and differentiated strategy which consistently delivers strong shareholder returns - this should not be jeopardised.
 
Commenting on the Circular, Alliance Trust's Chair, Karin Forseke, said:
 
"We urge all of our shareholders to consider carefully the Circular that we have published today and encourage them to play an active role in protecting the future of Alliance Trust by voting against the resolutions put forward by Elliott.
 
The Board is firm in its belief that this is about more than the nomination of directors and that Elliott has plans for disruptive actions that are at odds with the interests of other shareholders. The directors proposed by Elliott, who have been identified on its instruction, cannot be considered to be independent and we believe their addition to the Board would allow Elliott to pursue its own agenda and engineer a quick exit from its shareholding.
 
Alliance Trust is a company with a rich history and for whom the future prospects are bright. We are asking our investors to stand behind us, as they have before, to protect their company so we can continue to deploy our differentiated strategy and deliver strong returns for all shareholders for generations to come".

All terms used within this announcement will have the same meaning as applied within the Circular.

- Ends -

Chair's Letter to Shareholders Extracted from Today's Circular

Dear Shareholder,

Who are Elliott and what do they really want?

Our Company has been requisitioned by Elliott Advisors (UK) Ltd. to appoint three additional directors to the Board of Alliance Trust. Your Board believes this is just the thin end of the wedge and they would then pursue disruptive actions, to the detriment of other shareholders, focused on helping them to sell their shareholding quickly. Elliott is an affiliate of a U.S. based hedge fund manager with a controversial track record and a number of recent regulatory sanctions. In the UK, Elliott has had limited success in recent disruptive campaigns against public companies, such as Morrisons Supermarkets and National Express (which also included a requisition to appoint three additional non-executive directors).

Elliott's interests are at odds with those of other shareholders

Elliott has previously made clear to us that they see little or no value in the Company's dividend distributions, putting them at odds with the objectives of the majority of our shareholders. Furthermore, we believe that if these directors were appointed to your Board, Elliott would be likely to pursue disruptive actions to allow them to sell their shares quickly. In previous meetings with us, and as recently as last year, Elliott proposed that the Company launch a tender offer for 40% of its shares at a narrow discount. Such a tender may well engineer an exit for Elliott, but would require a significant liquidation of our Company's assets, jeopardising the Company's future and long-term value for shareholders.

Our Company already has a clear and differentiated strategy which consistently delivers strong shareholder returns

Our aim is to deliver strong and sustainable investment performance for our shareholders over the longer term. Alliance Trust has delivered above median Total Shareholder Return (TSR) since the appointment of its new equities leadership 6 months ago. Our TSR ranks in the top half of the Global sector a) for the last year (17%), b) since we became aware of Elliott's shareholding four years ago (60%) and c) since Katherine Garrett-Cox became CEO (92%). Alliance Trust has also delivered an unbroken track record of dividend growth over the last 48 years, including 14% growth in 2014, and our share price reached an all-time high earlier this year. This should not be jeopardised.

Alliance Trust adheres to high standards of corporate governance

Alliance Trust has an experienced, diverse and dynamic Board with the requisite skills, selected through a robust process. The Board has been extensively renewed since my appointment and takes corporate governance matters extremely seriously. The Board regularly reviews all aspects of the Company's strategy, challenging the status quo and the management team in the interests of all shareholders, which is why we believe the independence of your non-executive directors is of paramount importance.

We do not believe that the proposed directors can be judged to be independent

Elliott instructed the search firm and did not consult with the Company on the brief for the search, or on the identities of the proposed directors. Given that process, the Board is of the view that the nominees cannot be judged to be independent and is concerned that Elliott may seek to exert undue influence. Strong, independent non-executive representation on the Board is key to good governance.

For these reasons, your Board unanimously recommends that you VOTE AGAINST the Elliott Resolutions as they intend to do in respect of their own shareholdings - and urges all shareholders to vote as every vote counts.

Please read and consider the rest of this Circular before voting. I look forward to seeing many of you at the forthcoming Annual General Meeting in Dundee on 29 April 2015.

Yours sincerely
Karin Forseke
Chair

The Circular will be posted to shareholders and Alliance Trust Savings investors today, 26 March 2015. It will also be available at www.supportalliancetrust.com. A copy of the Circular has been submitted to the National Storage Mechanism and will shortly be available for inspection at: www.hemscott.com/nsm.do

The timetable for the Annual General Meeting is as follows:
 
Latest time and date for receipt of Form of Direction from Alliance Trust Savings investors  11.00 a.m. on 23 April 2015
Latest time and date for receipt of Form of Proxy
from Shareholders  		11.00 a.m. on 27 April 2015
Latest time and date for receipt of Supplemental Form of Direction from Alliance Trust Savings investors  10.00 a.m. on 27 April 2015
Latest time and date for receipt of Supplemental Form of Proxy from Shareholders  11.00 a.m. on 27 April 2015
Time and date of the General Meeting  11.00 a.m. on 29 April 2015

For more information please contact:
Finsbury
Conor McClafferty / Clare Dundas / Michael Turner
020 7251 3801
alliancetrust@finsbury.com

Alliance Trust
Evan Bruce-Gardyne, Director of Investor Relations
01382 321169
investor@alliancetrust.co.uk

Notes to editors
Alliance Trust PLC is a self-managed investment company with investment trust status. It is one of the largest generalist UK investment trusts by market value on the London Stock Exchange.

This press release contains "forward-looking statements" regarding the belief or current expectations of Alliance Trust PLC, its Directors and other members of its senior management about Alliance Trust PLC's businesses, financial performance and results of operations. These forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside the control of Alliance Trust PLC and are difficult to predict, that may cause actual results, performance or developments to differ materially from any future results, performance or developments expressed or implied by the forward-looking statements. These forward-looking statements speak only as at the date of this press release. Except as required by applicable law, Alliance Trust PLC makes no representation or warranty in relation to them and expressly disclaims any obligation to update or revise any forward-looking statements contained herein to reflect any change in Alliance Trust PLC's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Any information contained in this press release on the price at which shares or other securities in Alliance Trust PLC have been bought or sold in the past, or on the yield on such shares, should not be relied upon as a guide to future performance.



This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Alliance Trust PLC via Globenewswire
HUG#1906626

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