Tender Offer
Northern Venture Trust PLC
24 February 2005
For immediate release on 24 February 2005
Northern Venture Trust PLC (the 'Company')
Tender Offer
The Company is posting today a letter from the Chairman inviting Shareholders to
tender Ordinary Shares for purchase by the Company. In addition, Shareholders
are being given the opportunity to subscribe for further Ordinary Shares if they
so wish. Accompanying the letter are a Tender Offer Form and an offer for
subscription application form.
The full text of the Chairman's letter is set out below:
'Introduction
On 1 February 2005 I wrote to you to ask for your support in relation to
proposals to extend the Company's life, to authorise the Company to purchase
Ordinary Shares through a tender offer to Shareholders and to authorise the
Company to issue Ordinary Shares for cash by means of top-up offers to existing
Shareholders and new investors. I am pleased to inform you that these
resolutions were all passed with a substantial majority at the EGM of the
Company held earlier today.
The purpose of this document is to set out the terms and conditions of the
Tender Offer together with the procedure for tendering Ordinary Shares, details
of which can be found in the accompanying Tender Form. In addition, following
the extension of the life of the Company some Shareholders may wish to increase
their investment in the Company whilst taking advantage of the enhanced income
tax relief presently available for investment into VCTs. Accordingly an
application form to subscribe for new Ordinary Shares also accompanies this
letter.
Summary of the Tender Offer
Shareholders are now able to decide whether to tender some or all of their
Ordinary Shares within the overall limit of the Tender Offer.
The key points of the Tender Offer are as follows:
• the Tender Offer is open to Qualifying Shareholders only;
• the Tender Offer is for up to 10 per cent of the Company's current
issued Ordinary Share capital representing 3,950,490 Ordinary Shares;
• Qualifying Shareholders will be entitled to have up to 10 per cent
of their holdings (the ''Basic Entitlement'') repurchased by the Company under
the Tender Offer. They will also be able to request the repurchase of
additional Ordinary Shares, but such requests will only be satisfied, on a pro
rata basis, to the extent that other Qualifying Shareholders do not tender for
their full Basic Entitlement;
• Ordinary Shares will be acquired at the Tender Price, being a price
representing a discount of 5 per cent to the latest published net asset value of
the Company on 21 March 2005. The unaudited net asset value per Ordinary Share
as at 28 February 2005 will be announced during the first week in March; and
• completion of the purchase by the Company from Qualifying
Shareholders of Ordinary Shares under the Tender Offer shall be deemed to take
place on 22 March 2005 and will therefore fall within the 2004/05 tax year.
Reasons for the Tender Offer
As is the case with many other VCTs, the Company's Ordinary Shares have often
suffered from a lack of liquidity in the market. In response to this the
Company has at each annual general meeting since 1997 sought renewal of its
authority to purchase up to 10 per cent of its issued Ordinary Shares in the
market for cancellation. During the year ended 30 September 2004 the Company
purchased 521,400 Ordinary Shares, representing 1.3 per cent of the total
Ordinary Shares in issue at the beginning of the year.
Following the passing of the resolution at the EGM for the Company to continue
as a VCT, the Directors acknowledge that some Shareholders may now wish to have
the opportunity to dispose of part or all of their investment in the Company.
Your Board is now able to provide an opportunity for Shareholders to dispose of
Ordinary Shares at a narrow discount to the underlying net asset value, and
without incurring dealing costs.
Terms of the Tender Offer
Under the Tender Offer, Shareholders are entitled to sell up to 10 per cent of
their Ordinary Shares. They may tender to sell more or less than this number.
To the extent that they tender to sell a number less than or equal to 10 per
cent of their shareholding, their tender will be satisfied in full subject to
satisfaction of the conditions relating to the Tender Offer. To the extent that
they tender to sell more than 10 per cent of their holding, the excess will be
reduced on a pro rata basis to the extent that the total number of Ordinary
Shares validly tendered to the Company under the Tender Offer exceeds 10 per
cent of the Company's entire issued Ordinary Share capital. Full details are
given in the Tender Form accompanying this letter.
Shareholders should note that, if they have deferred a capital gain through
investment in the Ordinary Shares which they are tendering in the Tender Offer,
that capital gain may crystallise depending on their circumstances and become
chargeable at the prevailing rate of capital gains tax. Where the Ordinary
Shares disposed of constitute a qualifying disposal (for example where various
criteria, including where such shares were not acquired in excess of the
permitted maximum for any year of assessment, are met) then no tax should be
charged on the disposal. If the disposal is not a qualifying disposal then
income tax may be payable on the amount (if any) by which the Tender Price
exceeds the amount paid on subscription for or acquisition of the Ordinary
Shares. If the Ordinary Shares were subscribed for less than 3 years ago then
any income tax relief claimed on subscription or in relation to dividends
received on such Ordinary Shares may, in whole or part, be clawed back.
Shareholders who are in any doubt as to their own taxation position or who are
resident or otherwise subject to taxation in a jurisdiction outside the UK,
should consult their own professional advisers.
Calculation of the Tender Price
For the purposes of the Tender Offer, the price payable to Qualifying
Shareholders in respect of each Ordinary Share purchased under the Tender Offer
is a discount of 5 per cent to the latest published net asset value per Ordinary
Share on 21 March 2005, subject to a minimum of par value (25p per Ordinary
Share). It is intended to announce the unaudited net asset value per Ordinary
Share of the Company as at 28 February 2005 during the first week in March. By
way of example and based on the audited net asset value of the Company as at 30
September 2004 of 89.6p per Ordinary Share, the Tender Price would be 85.1p.
Overseas persons
The attention of all Shareholders is drawn to paragraph 17 of the section headed
''Terms and Conditions of the Tender Offer'' of the accompanying Tender Form and
to the other relevant provisions of the Tender Form.
It is the responsibility of all Shareholders to satisfy themselves as to the
observance of any legal requirements in their jurisdiction, including, without
limitation, any relevant requirements in relation to the ability of such
Shareholders to complete and return a Tender Form.
Tender Forms
Shareholders will find accompanying this document a Tender Form for use by them
in connection with the Tender Offer. Shareholders who wish to tender some or
all of the Ordinary Shares registered in their name on 21 February 2005 (the ''
Record Date'') should complete the Tender Form in accordance with the
instructions printed thereon and in the section headed ''Terms and Conditions of
the Tender Offer'' and return it by post or by hand (during normal business
hours) to the Receiving Agent, by no later than 5.00pm on 21 March 2005. A
prepaid envelope is enclosed for this purpose.
In addition, Shareholders who hold Ordinary Shares in certificated form should
return their Ordinary Share certificate(s) (at their own risk) in respect of the
Ordinary Shares tendered with the Tender Form. Shareholders who hold Ordinary
Shares in CREST should comply with the procedures set out in the Tender Form in
respect of transferring uncertificated Ordinary Shares to escrow through CREST.
Shareholders who do not wish to sell Ordinary Shares in the Tender Offer should
not return their Tender Forms. A Tender Form once lodged may not be withdrawn.
Offer for subscription
The Board believes that some Shareholders may, now that the life of the Company
has been extended, wish to subscribe for new Ordinary Shares in the Company, so
providing the Company with further funds for investment whilst taking advantage
of the enhanced level of income tax relief at 40 per cent available to investors
in VCTs until 5 April 2006. Therefore it is intended that your Company will
raise further cash for investment of up to approximately £8 million by way of a
series of small top-up offers to Shareholders and members of the public, as well
as through the Company's dividend investment scheme. An application form is
enclosed for those Shareholders wishing to subscribe for the new Ordinary Shares
in the Company available from the authority granted to the Company by
Shareholders at the EGM held today.
The first offer will be available until 3.00pm on 5 April 2005, for Shareholders
wishing to subscribe in the 2004/05 tax year, or until 3.00pm on 28 April 2005,
for Shareholders wishing to subscribe in the 2005/06 tax year. Applications
from existing Shareholders under the offer will be given priority over those
from the general public until 10 March 2005, following which all applications
will be considered on a first come first served basis. The offer will be open
until the earlier of the dates given above or when valid applications have been
received for 3,950,489 Ordinary Shares, representing approximately 10 per cent
of the issued share capital of the Company.
The Ordinary Shares under the offer will be issued at a price calculated on the
basis of a pricing formula, which is based on the latest published net asset
value per Ordinary Share of the Company on the business day prior to allotment
divided by 0.95, to allow for issue costs of 5 per cent, rounded up to the
nearest whole penny per Ordinary Share.
The number of Ordinary Shares allotted to each applicant will be determined by
the amount subscribed divided by the issue price as determined by the formula
set out above, rounded up to the nearest Ordinary Share. Subscription monies
not used to acquire Ordinary Shares will be refunded.
As an indication, based on the latest audited net asset value of 89.6p as at 30
September 2004, new Ordinary Shares would be issued at 95p per Ordinary Share.
The final issue price may be higher or lower than this and it will be determined
by the latest published net asset value on the business day prior to allotment.
For example, a 5 per cent uplift in net asset value would result in an issue
price of 99p per Ordinary Share but a 5 per cent fall in net asset value would
result in an issue price of 88p per Ordinary Share. Setting the issue price in
accordance with a pricing formula avoids any dilution in the net asset value
attributable to each existing Ordinary Share when new Ordinary Shares are issued
under the offer.
Any new Ordinary Shares so issued will rank pari passu in all respects with the
existing Ordinary Shares and will rank for all dividends which are both declared
and paid following Admission. Application will be made for Admission of any new
Ordinary Shares issued under the authority and it is proposed that Admission
will be effected at the earliest practicable opportunity for each tranche of
Ordinary Shares so issued. In each case, it is envisaged that definitive share
certificates (unless such shares are to be uncertificated In which case the new
Ordinary Shares will be credited to the relevant Shareholder's CREST account) in
respect of any Ordinary Shares issued under the proposed issues will be
despatched within 21 days of Admission. No temporary documents of title will be
issued. Ordinary Shares so issued may be dematerialised at the option of the
recipients and entered on the CREST system as the existing Ordinary Shares
presently are.'
Expected Timetable of Events
Announcement of Tender Offer and offer for subscription 24 February 2005
Record date for the Tender Offer 21 February 2005
Shareholders' priority for subscription for new Ordinary Shares expires 10 March 2005
First allotment of Ordinary Shares under the offer for subscription 14 March 2005
Latest time and date for receipt of Tender Forms 5.00pm on 21 March 2005
Announcement of take-up level under the Tender Offer 22 March 2005
Latest time and date for receipt of application forms for subscription in the 3.00pm on 5 April 2005
2004/05 tax year
Settlement date for the Tender Offer: Cheques despatched and assured payments 11 April 2005
made through CREST
Latest time and date for receipt of application forms for subscription in the 3.00pm on 28 April 2005
2005/06 tax year
Definitions
In this announcement, unless the context otherwise requires, the following
expressions bear the following meanings:
'Admission' admission of Ordinary Shares to the Official List of the UK Listing Authority and to trading on
the London Stock Exchange's market for listed securities
'Basic Entitlement' the entitlement of each Qualifying Shareholder to tender in the Tender Offer up to 10 per cent of
the Ordinary Shares registered in such Qualifying Shareholder's name on the Record Date
'Company' Northern Venture Trust PLC
'CREST' the computerised settlement system to facilitate the transfer of title to securities in
uncertificated form operated by CRESTCo Limited
'CREST Member' a person who has been admitted to CrestCo Limited as a system member (as defined in the
Uncertificated Securities Regulations 1995 (SI1995 No. 95/3272))
'CREST Participant' a person who, in relation to CREST, is a system-participant (as defined in the Uncertificated
Securities Regulations 1995 (SI1995 No. 95/3272))
'Directors' or 'Board' the directors of the Company
'EGM' the extraordinary general meeting of the Company held on 24 February 2005 at the offices of SJ
Berwin at 222 Gray's Inn Road, London WC1X 8XF
'London Stock Exchange' London Stock Exchange plc
'Member Account ID' the identification code or number attached to any member account in CREST
'Ordinary Shares' ordinary shares of 25p each in the capital of the Company
'Participant ID' the identification code or membership number used in CREST to identify a particular CREST
Member or other CREST Participant
'Qualifying Shareholders' the Shareholders other than those who have registered addresses in or who are citizens or
residents of the United States, Canada, Australia or Japan
'Receiving Agent' Lloyds TSB Registrars of The Causeway, Worthing, West Sussex BN99 6DA
'Record Date' close of business on 21 February 2005
'Shareholders' holders of Ordinary Shares
'Tender Form' the tender form issued by the Company for use by Shareholders in connection with the Tender
Offer
'Tender Offer' the invitation by the Company to Shareholders to tender Ordinary Shares on the terms and the
conditions accompanying the Tender Form
'Tender Price' the price per Ordinary Share representing a discount of 5 per cent to the latest published
net asset value of the Company on 21 March 2005, subject to a minimum of 25p per Ordinary
Share
'VCT' a venture capital trust as defined in section 842AA of the Income and Corporation Taxes Act
1988 (as amended)
Enquiries:
Alastair Conn or Chris Mellor
Northern Venture Managers Limited
Tel: 0191 244 6000
ENDS
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