Proposed Capital Reorganisati

RNS Number : 0312A

Oryx International Growth Fund Ld

29 July 2008

 



29 July 2008

Oryx International Growth Fund Limited ('Oryx' or the 'Company')

Proposed capital reorganisation and waiver of Rule 9 provisions of the City Code

The Company today announces that it has issued its Annual Report for the year ended 31 March 2008 to

Shareholders together with a circular containing details of the proposals in relation to the proposed Capital

Reorganisation and waiver of the Rule 9 provisions of the City Code along with the Notice of the

Company's Annual General Meeting.

Highlights

The Company announces that it will seek Shareholder approval at the Annual General Meeting for proposals to:

• undertake a capital reorganisation involving the consolidation and then sub-division of the Company's share capital;

• grant new authorities for the Company to buy back its own shares, including authority to buy back certain fractional entitlements arising on the consolidation of the Company's share capital; and

• waive the requirement for a mandatory offer to be made for the Company by the Concert Party under Rule 9 of the City Code as a result of any exercise of the authorities which are being sought by the Company to buy back its own shares.

Enquiries:

Arbuthnot Securities Limited                                          020 7012 2000

Alastair Moreton/Richard Tulloch

BNP Paribas Fund Services (Guernsey) Limited         01481 743 004

Company Secretary

Sara Radford / Jean McMillan

Capitalised terms used in this announcement will have the same meaning as in the circular to be sent to shareholders today unless the context requires otherwise.

The following information is extracted from the circular being sent to Shareholders today and should be read in conjunction with the full text of the circular which is available to view at www.oryxinternationalgrowthfund.co.uk.

Arbuthnot Securities Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for Oryx International Growth Fund Limited and for no one else in connection with the contents of this announcement and will not be responsible to anyone other than Oryx International Growth Fund Limited for providing the protections afforded to customers of Arbuthnot Securities Limited in relation to the contents of this announcement or any other matters referred to in this announcement.

  1.    Capital Reorganisation and Rule 9 Waiver

The details of the proposals relating to the Capital Reorganisation and Rule 9 Waiver are set out in a letter from Nigel Cayzer, Chairman of Oryx, contained within the circular being sent to Shareholders today, and a paraphrase of the relevant sections of the Chairman's letter is set out below:

Capital Reorganisation

Background

The Company currently has over 7,650 Shareholders. Of these over 6,850 Shareholders have registered holdings of less than 100 Ordinary Shares, representing some 89 per cent. of the total number of Shareholders but less than 0.56 per cent. of the Ordinary Shares in issue.

The Board believes that for a company of its size, it is not in the Company's best interest to continue to bear the significant cost of serving such a large shareholder base. The Board also believes that many Shareholders with small holdings may have considered selling their Ordinary Shares but decided not to do so due to the disproportionate dealing and administration costs relating to such a sale.

As at the close of business on 25 July 2008 being the last practicable date prior to this announcement, a shareholding of 100 Ordinary Shares was worth £188.75 at the mid-market price.

Consolidation

The Board is therefore proposing to undertake a capital reorganisation of the Ordinary Shares, the effect of which will be to reduce the number of Shareholders hence achieving cost savings for the Company, whilst at the same time returning value, free from transaction costs, to the Small Shareholders. It is proposed to achieve this by first undertaking the Consolidation, consolidating every 100 Ordinary Shares into one Consolidated Share.

As a consequence of the Consolidation, Small Shareholders (who hold less than 100 Ordinary Shares at the Record Time) will not, unless they validly cast their votes against the resolution proposing the Share Consolidation ('Consolidation Resolution'), receive any Consolidated Shares but will receive a Fractional Entitlement (to a Consolidated Share), which will be aggregated with other such Fractional Entitlements and sold by the Company on their behalf.  With a view to maximising the sale price of the Fractional Entitlements, the Company itself then intends to purchase those Fractional Entitlements, pursuant to an off market share purchase authority and under a form of agreement ('Share Purchase Agreement'), approval of both of which are also being sought at the Annual General Meeting. The Listing Rules state that any purchase of shares made under a general authority granted by shareholders may only be made if the price to be paid is not more than the higher of:

             (a) 105 per cent. of the average of the middle market value of the share for the five Business Days prior
                   to the purchase; and

             (b)  that stipulated by Article 5(1) of the Buy-back and Stabilisation Regulation being the higher of the
                   price of the last independent trade and the highest current independent bid available in the market.

In line with this requirement, the Share Purchase Agreement provides that the Company will buy the Fractional Entitlements back at the mid-market price of the Ordinary Shares, adjusted for the Consolidation, on the day preceding the purchase or, if lower, at the highest allowed price in accordance with the Listing Rules.

For shareholdings greater than 100 Ordinary Shares at the Record Time, then unless the holding is divisible by 100, the Consolidation will give rise to a whole number of Consolidated Shares together with a Fractional Entitlement, all of which will be converted into New Ordinary Shares in the Sub-division.  Shareholders who hold less than 100 Ordinary Shares at the Record Time, but validly cast their votes either in person or by proxy against the Consolidation Resolution, will also have their Fractional Entitlement converted into New Ordinary Shares in the Sub-division.

The Consolidation Resolution deals with the Consolidation and authorises the Directors to implement the sale of the Fractional Entitlements of Small Shareholders. It is intended that the sale of the Fractional Entitlements will then be effected by means of the Share Purchase Agreement and the Consolidation Resolution authorises any Director, as attorney for the Small Shareholders, to execute the Share Purchase Agreement on their behalf.

Sale and purchase of Fractional Entitlements

The Share Purchase Agreement provides that Small Shareholders will receive payment of the sale proceeds of their Fractional Entitlements by cheque if they hold their shares in certificated form, or if held through CREST their CREST accounts will be credited within 14 days of the Record Time, and all such Fractional Entitlements which are purchased by the Company will be cancelled by the Company. Further details of the Share Purchase Agreement will be set out in the circular.

The reasons for the Company proposing to purchase the Fractional Entitlements itself by way of an off market purchase through the Share Purchase Agreement is:

• to ensure that they are bought immediately after the Record Time;

• to retain value for remaining Shareholders by cancelling the purchased Fractional Entitlements; and

• to avoid incurring the cost of a market purchase of the Fractional Entitlements which would involve the admission of the Consolidated Shares to the Official List and to trading on the Main Market, and broker costs and charges for the sale and purchase.

Sub-division

In order to avoid the Consolidation having a detrimental effect on the market price of the Company's shares, and to avoid confusion that might arise from the Consolidation, the Board is proposing that, immediately following the Consolidation and the sale and purchase of the Fractional Entitlements of the Small Shareholders, the remaining Consolidated Shares and Fractional Entitlements will be subdivided on the basis of 100 New Ordinary Shares for each Consolidated Share held and proportionately for any Fractional Entitlement.

Share rights

The New Ordinary Shares created by the Capital Reorganisation will have the same rights as the Existing Ordinary Shares. Immediately following the proposed Capital Reorganisation the Company will apply for the admission of the New Ordinary Shares to the Official List and to trading on the Main Market. It is anticipated that dealings in the Existing Ordinary Shares will continue until the close of business on 29 August 2008 and that dealings in the New Ordinary Shares will commence at 8.00 a.m. on the next Business Day, 1 September 2008.

Share Purchase Authorities

The Company is seeking Shareholder approval for the following authorities to purchase its own shares:

 (a) an off market purchase authority to acquire the Fractional Entitlements of Small Shareholders pursuant to
       the Share Purchase Agreement as explained above; and

 (b) an on market purchase authority to acquire shares in the market.  In accordance with the Listing Rules, this
      authority specifies the maximum number of Ordinary Shares that may be acquired, which shall not, when
      aggregated with the number of Ordinary Shares equivalent to the Fractional Entitlements purchased under
      the Off Market Purchase Authority, represent more than 14.99 per cent. of the Company's current issued
      share capital equivalent to 3,715,633 Ordinary Shares, and the maximum and minimum price at which they
      may be bought. Accordingly, the maximum number of Ordinary Shares that may be purchased pursuant to the
      On Market Purchase Authority will be 3,715,633 Ordinary Shares reduced by the equivalent number of
      Ordinary Shares that are purchased pursuant to the Off Market Purchase Authority. This authority will expire
      at the earlier of the conclusion of the Company's next annual general meeting to be held in 2009 or on the
      date which is 18 months from the date of the passing of this resolution.

Waiver of Rule 9 of the City Code

The Company is seeking approval of Independent Shareholders of the waiver of certain obligations which may arise under the City Code as a result of any exercise of the Share Purchase Authorities which are being sought by the Company to buy back its own shares.

Christopher Mills, who is a director of Oryx, is also the chief investment officer and a director of NASCIT. He is also a shareholder of Oryx and of NASCIT and a partner of North Atlantic Value the investment manager of both Oryx and NASCIT, with personal responsibility for management of the portfolio of both Oryx and NASCIT. As a result, for the purposes of the City Code, both Mr Mills and NASCIT, who in aggregate are currently interested in 7,435,000 Existing Ordinary Shares representing approximately 29.995 per cent. of the issued share capital of the Company, are deemed to be acting in concert for the purpose of Rule 9 and Rule 37.1 of the City Code. Further details of the Concert Party will be set out in the circular which is being sent to Shareholders today.

Therefore, if the Company were to repurchase all of the Fractional Entitlements of the Small Shareholders and the Ordinary Shares for which it is seeking authority from persons other than the Concert Party pursuant to the Share Purchase Authorities, this would result in the Concert Party being obliged to make an offer for the Company.

As a result, your Independent Directors have consulted with the Panel, which has agreed, subject to the Independent Shareholders voting on a poll at the AGM to approve the Waiver Resolution, to waive any obligation that would otherwise arise, under Rule 9 and Rule 37.1 of the City Code for the Concert Party, as a result of the purchase of the Fractional Entitlements of the Small Shareholders and/or any market purchases of Ordinary Shares by the Company pursuant to the Share Purchase Authorities, to make a general offer for the Ordinary Shares which they do not already hold.

2.    Further information and details of the Proposals

The Company has today issued its Annual Report for the year ended 31 March 2008 along with a circular to Shareholders containing further details of the Proposals, including notice of the Annual General Meeting to seek Shareholder approval for the Proposals and the recommendation of the Board to vote in favour of the Capital Reorganisation and the recommendation of the Independent Directors to vote in favour of the Rule 9 Waiver.

The Annual General Meeting is to be held at 10.00 a.m. on 29 August 2008.

Copies of the above documents are being submitted today to the UK Listing Authority and will shortly be available for inspection at the UK Listing Authority's Document Viewing Facility, which is situated at:

Financial Services Authority

25 The North Colonnade
Canary Wharf
London

E14 5HS

The Annual Report 2008 and the circular to Shareholders are also available on Oryx's website at www.oryxinternationalgrowthfund.co.uk.

 

END

 

 

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