Publication of EGM Circular

RNS Number : 5481P

VietNam Holding Limited

25 October 2012

 



VIETNAM HOLDING LIMITED

Publication of EGM Circular

Following the announcement on 18 October 2012, the Directors of Vietnam Holding Limited (the "Company") have decided to recommend to shareholders and warrantholders that the term of its warrants, which were issued by the Company through a bonus issue on 29 May 2012, be extended beyond their current exercise date of 13 December 2012 through the provision of an additional two exercise dates, on 25 April 2013 and 25 September 2013.

Under the terms of the warrant instrument any extension would require the approval of warrantholders at an extraordinary general meeting.  However, as the proposals will extend the period of time during which the existing ordinary shares may be diluted by the exercise of the warrants, the Company is also seeking shareholder approval at an extraordinary general meeting of its shareholders.

The Company has today published a Circular to its shareholders and warrantholders (the "Circular") giving notice of their respective extraordinary general meetings which will both be held at Zephyr House, 122 Mary Street, George Town, PO Box 709, Grand Cayman, KY1-1107 on 14 November 2012. The shareholder meeting will be at 9am local time, and the warrantholder meeting at 10am local time.

Electronic copies of the Circular have been made available to shareholders and warrantholders on the Company's website at www.vietnamholding.com

Introduction

The Company announced on 18 October 2012 that it was proposing to extend the term of the warrants beyond their current exercise date of 13 December 2012 through the provision of an additional two exercise dates, on 25 April 2013 and 25 September 2013.

Reasons for the proposed creation of additional exercise dates

At the time that the warrants were issued, the Board of the Company (the "Board") and the Investment Manager of the Company (the "Investment Manager") expected that the Vietnamese stock markets would stage a recovery in the second half of 2012, which would have resulted in the warrants being "in the money" and therefore being exercised in December 2012.  Unfortunately, due to a number of factors, including the state of the global economy, this may not materialise.

The Board is proposing to extend the term of the warrants for the following principal reasons:

·           the Company and the Investment Manager believe that the prospects for the Vietnamese economy are good and the Vietnamese stock markets are likely to recover in 2013 such that the warrants continue to offer an attractive way to benefit from the Company's future NAV growth.  If this proves to be correct, the warrants may move "into the money" if their term is extended into 2013;

·           an increase in the number of Shares issued following the exercise of any warrants may help to improve the liquidity of the Shares on AIM;

·           if the warrants expire "out of the money" they are very unlikely to be exercised and the Company's asset base will not grow.  This will mean that the anticipated benefits of the warrant issue, such as spreading the Company's fixed costs across a wider asset base and providing the Company with additional funds for investment, will not be realised; and

·           the costs of extending the existing warrants is substantially less than the costs of issuing a new series of warrants.

The additional exercise dates

The proposals consist of amending the warrant instrument to provide for two new exercise dates, 25 April 2013 and 25 September 2013, in addition to the current exercise date of 13 December 2012.  Assuming shareholder and warrantholder approval is obtained at the Shareholder EGM and warrantholder EGM respectively, this will be implemented through an amendment of the warrant instrument.  Other than the inclusion of the additional exercise dates and the necessary consequential changes, no amendments will be made to the warrant instrument.  In particular, shareholders and warrantholders should note that the exercise price of US$1.196 will remain unchanged.

Extraordinary General Meetings

An extension to the warrants term requires the approval of warrantholders at an extraordinary general meeting.  As the proposals will extend the period of time during which the existing Shares may be diluted by the exercise of the Warrants, the Company is also seeking shareholder approval at the shareholder EGM. 

Set out in the Circular is a notice convening the shareholder EGM, which will be held at 2nd floor, Zephyr House, 122 Mary Street, George Town, PO Box 709, Grand Cayman, KY1-1107 on 14 November 2012 at 9.00 a.m. (Cayman Islands time). 

The Circular also contains a notice convening the warrantholder EGM to be held at 2nd floor, Zephyr House, 122 Mary Street, George Town, PO Box 709, Grand Cayman, KY1-1107 on 14 November 2012 at 10.00 a.m. (Cayman Islands time). 

For more information please contact:
VietNam Holding Asset Management Limited
Gyentsen Zatul	Telephone: [phone]
- Investor Relations
Oriel Securities Limited (Nominated Adviser and Broker)
Joe Winkley	Telephone: [phone]

 

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