BCAP Better Capital Pcc Limited

TIDMBC12 TIDMBCAP

RNS Number : 2297L

Better Capital PCC Limited

29 April 2020

29 April 2020

Better Capital PCC Limited

(the "Company")

Notice of Extraordinary General Meetings and Publication of Circular

The Company announces today that its Directors propose to cancel the listing on the Official List and the trading on the London Stock Exchange of the 2009 Shares and the 2012 Shares and are convening Extraordinary General Meetings for the 2009 Shareholders, the 2012 Shareholders and Shareholders as a whole to consider and, if thought fit, approve such proposals.

The Company will post a circular to all Shareholders today (the "Circular") containing further details of the proposals and notices convening Extraordinary General Meetings of (i) the holders of the ordinary shares in the capital of the 2009 Cell of the Company to be held at 3.00 p.m.; (ii) the holders of the ordinary shares in the capital of the 2012 Cell of the Company to be held at 3.10 p.m. (or if later immediately following the conclusion of the Extraordinary General Meetings of the 2009 Shareholders); and (iii) together in one meeting, the holders of ordinary shares in the capital of the 2009 Cell of the Company and the holders of the ordinary shares in the capital of the 2012 Cell of the Company to be held at 3.20 p.m. (or if later immediately following the conclusion of the Extraordinary General Meetings of the 2012 Shareholders) to be held on 12 May 2020 at Candie House, Candie Road, St Peter Port, Guernsey, GY1 1UP.

The States of Guernsey has introduced measures with effect from 25 March 2020 prohibiting travel subject to certain limited exceptions and, in light of the guidance with respect to COVID-19, Shareholders may be refused entry into the Bailiwick of Guernsey or the Extraordinary General Meetings if they try to attend in person. In light of the travel restrictions and stay at home measures in place as at the date of this letter, Shareholders are asked not to attempt to attend the Extraordinary General Meetings and instead appoint the Chairman of the relevant Extraordinary General Meeting to act as their proxy in casting votes in accordance with the Shareholder's instruction.

Shareholders are invited to participate in the relevant Extraordinary General Meetings by submitting any questions in advance and/or joining via the telephone conference dial-in facilities being established. Any specific questions on the business of the Extraordinary General Meetings can be submitted (with details of the shareholding) by no later than 24 hours prior to the relevant meeting (or any adjournment thereof) by email to becapteam-GG@ocorian.com. Details of how to access the dial-in facilities will be provided to Shareholders on application to the same email address.

Copies of the Circular and forms of proxy will shortly be available for inspection at the National Storage Mechanism at http://www.morningstar.co.uk/uk/NSM . In addition, the Circular will shortly be available to view on the Company's website ( www.bettercapital.gg ). The full text of the Chairman's letter contained in the Circular is given below.

Defined terms used in this announcement shall (unless the context otherwise requires) have the same meanings set out in the Circular dated 28 April 2020.

For further information, please contact:

 
 Better Capital PCC Limited 
  Norman Amey (Administrator and Company 
  Secretary)                                +44 (0)1481 742 742 
 Numis Securities Limited 
  Nathan Brown                              +44 (0)20 7260 1000 
 

CHAIRMAN'S LETTER

Proposed cancellation of the listing and trading of the 2009 Shares and the 2012 Shares

Dear Shareholder,

The Company has today announced that it is convening extraordinary general meetings of the 2009 Shareholders, of the 2012 Shareholders and of all Shareholders, each to be held on Tuesday 12 May 2020, at which the Board will put forward resolutions to cancel the listing on the Official List and the trading on the London Stock Exchange of the 2009 Shares and the 2012 Shares. It is anticipated that the effective date of the Share Delistings will be 10 June 2020.

Under the Listing Rules and the provisions of the Articles of Incorporation:

-- the 2009 Share Delisting requires the Company to obtain the prior approval for such cancellation of:

o not less than 75 per cent. of the votes in person or by proxy at an Extraordinary General Meeting of the 2009 Shareholders; and

o not less than 75 per cent. of the votes in person or by proxy at an Extraordinary General Meeting of all Shareholders; and

-- the 2012 Share Delisting requires the Company to obtain the prior approval for such cancellation of:

o not less than 75 per cent. of the votes in person or by proxy at an Extraordinary General Meeting of the 2012 Shareholders; and

o not less than 75 per cent. of the votes in person or by proxy at an Extraordinary General Meeting of all Shareholders.

BACKGROUND TO AND REASONS FOR THE SHARE DELISTINGS

The Company is a limited liability, Closed-ended Investment Company. The Company has an unlimited life and is registered with the Guernsey Financial Services Commission as a Registered Closed-ended Collective Investment Scheme. The Company was established in 2009 as a feeder fund for 2009 Shareholders to invest in Fund I. In 2012, the Company's protected cell structure was established to additionally facilitate 2012 Shareholders investing in Fund II.

The duration of Fund I has recently been extended to 17 June 2021 with the consent of the Company. Fund II is scheduled to terminate on 30 June 2021 subject to the general partner of Fund II exercising its discretion to extend the term for up to two additional one year periods, subject to the consent of the Company.

The Board has been implementing a strategic plan for an orderly wind down of the Cells in line with the anticipated termination dates of their underlying Funds. However, as announced by the Company on 26 March 2020, the coronavirus pandemic has had a material effect on the remaining portfolio companies which has made it very unlikely that the realisation of the assets can sensibly be achieved within the current durations of the Funds. It is also the case that the considerable costs of maintaining the Company's listed status are increasingly disproportionate to the value of the portfolios and that the Shares have limited trading liquidity on the Main Market.

Accordingly, the Directors have resolved to propose the Share Delistings at the Extraordinary General Meetings.

DETAIL OF THE SHARE DELISTINGS

Cost savings

The Board has focused on ongoing operational costs and considered whether it is still appropriate for the 2009 Shares and 2012 Shares to be admitted to the Official List and trading on the Main Market. The Board has concluded that the Company would benefit from the passing of the Resolutions to give effect to the Share Delistings due to the significant ongoing annual costs associated with maintaining admission to the Official List and trading on the Main Market. These costs have become increasingly significant as the value of both Cells has diminished. The Board also believes that the Company would benefit from the simpler administration and regulatory requirements following the Share Delistings which would be appropriate to the Company's size. The Company expects to achieve costs savings as a result of no longer being subject to the provisions of the listed company regime. It is estimated that the Company should achieve cost savings of approximately GBP320,000 in the financial year following the Share Delistings.

Investment Objective

The Company's investment objective as a private company will continue to be the distribution to Shareholders of realisation proceeds from asset disposals made by the Funds. The coronavirus pandemic has made it very unlikely that the realisation of the assets of Fund I and Fund II can sensibly be achieved within the current durations of the Funds and it is anticipated that following the Delisting, once the extent and duration of the effects of the pandemic are quantifiable, proposals to amend the durations of the Funds will be proposed to Shareholders along with any revised corporate arrangements believed appropriate.

Shareholder considerations

Shareholders should take into consideration, amongst other things, that following the Delistings (a) there will be no public market for the Shares and the opportunity for Shareholders to realise their investment in the Company by selling their Shares will be reduced; (b) the corporate governance, regulatory and financial reporting regime which applies to companies whose shares are admitted to the Official List and to trading on the Main Market will no longer apply; and (c) there may be taxation consequences for Shareholders as a result of the Shares no longer being admitted to the Official List and to trading on the Main Market. Shareholders should consult their own professional advisers and seek their own advice in connection with the potential consequences of the Share Delistings, including any potential changes in the tax treatment of their holding of Shares.

Conditional upon the Resolutions being approved at the Extraordinary General Meetings, the Company will apply to cancel the listing of the Shares on the Official List and their admission to trading on the Main Market. It is anticipated that the last day of dealings of both the 2009 Shares and the 2012 Shares on the Main Market will be 9 June 2020. Cancellation of the listing of the 2009 Shares and the 2012 Shares on the Official List is expected to take effect at 8.00 a.m. on 10 June 2020, being not less than 20 Business Days from the passing of the Resolutions as required by the Listing Rules.

Corporate structure

It is intended that following the Share Delistings, the Company will continue to operate in accordance with the current Articles, including maintaining its protected cell structure and its relationship with Fund I and Fund II (the terms of which are also being maintained). However, the Company's corporate structure will remain under review and future proposals to amend the corporate constitution to arrangements more appropriate to a private company which does not have its shares traded on the public markets may be proposed to Shareholders following the Share Delistings. Any future changes to the Articles (and also certain other general corporate matters affecting the Company as a whole in accordance with the Articles and the Companies Law) will be subject to approval by Shareholders as a whole.

Governance

The Directors intend following the Share Delistings to operate the Company's corporate governance in substantially the same manner as at present. It is intended that all of the members of the Board will remain in position following the Share Delistings, although their fees will be reduced.

Financial Reporting

The Company will continue to produce an annual report. Under the laws of Guernsey the annual report is required to be approved by Shareholders at general meeting by 30 September after each 31 March financial year end. On the basis that the Share Delistings, if approved by Shareholders, will take effect on 10 June 2020, then the annual report for the financial year ended 31 March 2020 will be published in order that Shareholder approval is sought by no later than 30 September 2020.

Regulatory

Following the Share Delistings, the Company will continue to be registered as a Registered Closed-ended Collective Investment Scheme with, and thereby subject to regulation by, the Guernsey Financial Services Commission.

Additionally the Takeover Code will continue to apply for a period of ten years from the effective date of the Share Delistings. As currently, the Takeover Code will apply to the Company as whole rather than separately to the Cells.

However, following the Share Delistings:

a) the regulatory regime which applies solely to companies such as the Company with shares admitted to the listing category "Premium Equity Closed Ended Investment Funds" of the Official List, and to trading on the Main Market, will no longer apply to the Shares, as detailed below;

b) the Company will not be subject to the disciplinary controls of the Listing Rules, under which a closed-ended investment company listed on the premium segment of the Official List:

a. is required to appoint a 'sponsor' for the purposes of certain corporate transactions, such as when undertaking a significant transaction or capital raising. The responsibilities of the sponsor include providing assurance to the FCA when required that the responsibilities of the listed company have been met;

b. is required to obtain the prior approval of its shareholders to any material change to its published investment policy;

c. is required to seek shareholder approval for a broader range of transactions including related party transactions (related parties including the Directors and the Funds' general partners);

   d.   there are stringent obligations with regard to a company's purchase of its own securities; and 
   e.   there are specified structures and pricing limits in relation to further issues of securities. 

c) certain institutional investor guidelines (such as those issued by the Investment Association, the Pensions and Lifetime Savings Association and the Pre-Emption Group), which give guidance on issues such as executive compensation and share-based remuneration, corporate governance, share capital management and the allotment and issue of shares on a pre-emptive or non pre-emptive basis, will not apply to the Company as the Shares will not be admitted to the Official List or to trading on the Main Market;

d) certain securities laws will no longer apply to the Company, for example, the Disclosure Guidance and Transparency Rules, including in relation to notification of significant shareholdings, and the Market Abuse Regulations.

TRADING UPDATE

The Company issued an announcement on 26 March 2020, which disclosed that the corona virus pandemic had inevitably had a serious effect upon the portfolio companies to which the Cells are exposed. There have been no material developments since that date. Within Fund II, in which the 2012 Cell is invested, Spicers OfficeTeam and Everest remain in very considerable difficulties with severe financial challenges and much effort is being dedicated to maintaining their future operations.

EXTRAORDINARY GENERAL MEETINGS

The Directors are convening:

-- the Extraordinary General Meeting of the 2009 Shareholders to consider the special resolution in relation to the 2009 Share Delisting;

-- the Extraordinary General Meeting of the 2012 Shareholders to consider the special resolution in relation to the 2012 Share Delisting; and

-- the Extraordinary General Meeting of all Shareholders to consider the special resolutions in relation to the Share Delistings.

Notices convening the Extraordinary General Meetings of the 2009 Shareholders, the 2012 Shareholders and all of the Company's Shareholders as a whole are set out in Parts 4 to 6 of this circular respectively and enclosed separately are the forms of proxy for you to use in connection with your votes at the forthcoming Extraordinary General Meetings of the Company.

If all resolutions are passed, the Board proposes to make an application to the FCA for the 2009 Share Delisting and the 2012 Share Delisting. If the requisite percentage of Shareholders does not approve the resolution to give effect to either the 2009 Share Delisting or the 2012 Share Delisting, the Directors will proceed to make application for the Share Delisting in respect of which they have received authority and the other class of Shares (be that 2009 Shares or the 2012 Shares, as the case may be), will continue to be admitted to the premium segment of the Official List and to trading on the Main Market. If none of the resolutions are passed, the Shares will continue to be admitted to the premium segment of the Official List and to trading on the Main Market.

COVID-19 AND STAY AT HOME MEASURES

The Board notes that due to the impact of COVID-19, it will be extremely challenging to hold the Extraordinary General Meetings in the format typically expected by Shareholders. The location of the Extraordinary General Meetings may need to be reconsidered closer to the time and the Company will update Shareholders of any changes via a regulatory news service announcement and details on the Company's website.

The States of Guernsey has introduced measures with effect from 25 March 2020 prohibiting travel subject to certain limited exceptions and, in light of the guidance with respect to COVID-19, Shareholders may be refused entry into the Bailiwick of Guernsey or the Extraordinary General Meetings if they try to attend in person. In light of the travel restrictions and stay at home measures in place as at the date of this letter, Shareholders are asked not to attempt to attend the Extraordinary General Meetings and instead appoint the chairman of the relevant Extraordinary General Meeting to act as their proxy in casting votes in accordance with the Shareholder's instruction.

Shareholders are invited to participate in the relevant Extraordinary General Meetings by submitting any questions in advance and/or joining via the telephone conference dial-in facilities being established . Any specific questions on the business of the Extraordinary General Meetings can be submitted (with details of the shareholding) by no later than 24 hours prior to the relevant meeting (or any adjournment thereof) by email to becapteam-GG@ocorian.com. Details of how to access the dial-in facilities will be provided to Shareholders on application to the same email address.

ACTION TO BE TAKEN

The following is guidance to assist in voting at the Extraordinary General Meetings, dependent on whether you hold shares in one or both of the cells of the Company. Forms of proxy are colour coded for clarity.

Holders in the Better Capital PCC 2009 Cell only

There are two meetings relevant to your holding:

12 May 2020 - 3.00 p.m. - Meeting of the 2009 Shareholders; and

12 May 2020 - 3.20 p.m. - Meeting of all of the Company's Shareholders.

   --    In respect of the meeting of the 2009 Shareholders, the applicable form of proxy is blue. 
   --    In respect of the meeting of all Shareholders, the applicable form of proxy is white. 

You should complete both the blue and white forms of proxy and return both to the Company's registrar, as detailed in the notes at the footer of the forms of proxy.

Holders in the Better Capital PCC 2012 Cell only

There are two meetings relevant to your holding:

12 May 2020 - 3.10 p.m. - Meeting of the 2012 Shareholders; and

12 May 2020 - 3.20 p.m. - Meeting of all of the Company's Shareholders.

   --    In respect of the meeting of the 2012 Shareholders, the applicable form of proxy is pink. 
   --    In respect of the meeting of all Shareholders, the applicable form of proxy is green. 

You should complete both the pink and green forms of proxy and return both to the Company's registrar, as detailed in the notes at the footer of the forms of proxy.

Holders in both of Better Capital PCC 2009 Cell and Better Capital PCC 2012 Cell

There are three meetings relevant to your holding:

12 May 2020 - 3.00 p.m. - Meeting of the 2009 Shareholders;

12 May 2020 - 3.10 p.m. - Meeting of the 2012 Shareholders; and

12 May 2020 - 3.20 p.m. - Meeting of all of the Company's Shareholders.

   --    In respect of the meeting of the 2009 Shareholders, the applicable form of proxy is blue. 
   --    In respect of the meeting of the 2012 Shareholders, the applicable form of proxy is pink. 

-- In respect of the meeting of all of the Company's Shareholders, there are two applicable forms of proxy for completion. In respect of your holding in the 2009 Cell, the relevant form of proxy is white and in respect of your holding in the 2012 Cell, the relevant form of proxy is green.

You should complete all four forms of proxy and return all four to the Company's registrar, as detailed in the notes at the footer of the forms of proxy.

Shareholders are requested to complete each applicable form of proxy in accordance with the instructions printed on it and return it to the Company's registrar, PXS1, 34 Beckenham Road, Beckenham, Kent BR3 4ZF, as soon as possible, but in any event not later than 48 hours before the meeting (excluding any days which are not Business Days). Shareholders may alternatively appoint a proxy electronically through www.signalshares.com or the CREST electronic proxy service in accordance with the instructions set out in the relevant notice. Return of a form of proxy will not prevent any Shareholders from attending and voting in person at their respective Extraordinary General Meetings, should they so wish.

For further details regarding the voting protocol at each meeting, we refer you to the relevant notice of Extraordinary General Meeting which is contained within this letter.

These guidance notes are for information only and all holders should refer to the notes included on each relevant notice of Extraordinary General Meeting and form of proxy.

RECOMMENDATIONS

The Board considers that the Share Delistings are in the best interests of the Shareholders as a whole. Accordingly, the Directors unanimously recommend all Shareholders who are able to do so to vote in favour of the Resolutions at the Extraordinary General Meetings.

The Directors, who in aggregate have interests in 6,861,618 of the 2009 Shares and 74,570,820 of the 2012 Shares, intend to vote their entire beneficial holdings in 2009 Shares at the Extraordinary General Meeting of the 2009 Cell, to vote their entire beneficial holdings in 2012 Shares at the Extraordinary General Meeting of the 2012 Cell and to vote their entire beneficial holdings of 2009 Shares and 2012 Shares at the Extraordinary General Meeting of the Company, in favour of the Resolutions. The Directors' aggregate holding of 2009 Shares amounts to 19.46 per cent. of the total issued 2009 Shares, the Directors' aggregate holding of 2012 Shares amounts to 25.76 per cent. of the total issued 2012 Shares and the Directors' aggregate holding of 2009 Shares and 2012 Shares amounts to 25.07 per cent. of the total issued share capital of the Company, in each case as at 27 April 2020 (being the latest practicable date prior to the publication of this document).

Yours faithfully

Richard Crowder

Chairman

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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April 29, 2020 02:00 ET (06:00 GMT)