Acorn Income Fund - EGM Circular and Prospectus

Dienstag, 29.11.2016 13:00 von

PR Newswire

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO, THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA, JAPAN, NEW ZEALAND, SOUTH AFRICA, IN ANY MEMBER STATE OF THE EEA (OTHER THAN THE UNITED KINGDOM) OR IN ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL

This announcement is not an offer to sell, or a solicitation of an offer to acquire, securities in the United States or in any other jurisdiction in which the same would be unlawful. This announcement is an advertisement and does not constitute a prospectus and investors must only subscribe for or purchase any shares referred to in this announcement on the basis of information contained in a prospectus published today by the Company (as defined below) and any supplementary prospectus issued by the Company prior to the relevant Admission (as defined below) and not in reliance on this announcement. Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract, commitment or investment decision whatsoever to purchase shares in the Company or otherwise.

29 November 2016

Acorn Income Fund Limited

(the “Company”)

Publication of Circular and Prospectus

1. Introduction

The Board today announces proposals including:

(i)         the extension of the life of the existing ZDP Shares to 28 February 2022;

(ii)         a Continuation Offer to ZDP Shareholders whereby such holders are given an opportunity to either receive their 2017 Final Capital Entitlement in cash on 31 January 2017 or to continue their investment in the existing ZDP Shares and have the right to receive the 2022 Final Capital Entitlement of 167.2 pence per ZDP Share on 28 February 2022; and

(iii)        the issue of New Ordinary Shares and New ZDP Shares pursuant to the Issues.

The Proposals require the approval of Ordinary Shareholders and ZDP Shareholders at the Meetings, which have been convened for 20 December 2016. The Company will shortly be publishing a circular (the “Circular”) to provide details of the Proposals and to set out the reasons why the Board recommends that Shareholders vote in favour of the Proposals at the Meetings, as well as to set out the actions required to be taken by ZDP Shareholders in respect of the Continuation Offer.

Shareholders and other investors also have the opportunity to participate in the Initial Placing and Offer. Shareholders considering participation in the Initial Placing and Offer should refer to the prospectus also being published by the Company.

The Circular and Prospectus will also shortly be available on the Company's website at:

https://www.premierfunds.co.uk/media/899292/acorn-income-fund-circular-november-2016.pdf; and
https://www.premierfunds.co.uk/media/899303/acorn-income-fund-prospectus-november-2016.pdf.

Further information on the Company can be found at:

https://www.premierfunds.co.uk/advisers/investments/investment-trusts/acorn-income-fund

For further information please contact:

Investment Manager:
Premier Fund Managers Limited
Nigel Sidebottom
Tel: +44 (0) 1483 400 465
Email: nigelsidebottom@premierfunds.co.uk

Broker, Financial Adviser and Sponsor:

Numis Securities Limited
Nathan Brown
Tel: +44 (0) 20 7260 1426
Email: n.brown@numis.com

Company Secretary:

Northern Trust International Fund Administration Services (Guernsey) Limited
Cara De La Mare
Tel: +44 (0) 1481 745498
Email: cd109@ntrs.com

2. Background to and reasons for the Proposals

The Company currently has two classes of Shares in issue: Ordinary Shares and ZDP Shares. The Ordinary Shares have been traded on the main market of the London Stock Exchange since February 1999. Since that date, the Company has issued further Ordinary Shares and ZDP Shares from time to time, all of which are admitted to listing by the UK Listing Authority and traded on the premium segment of the main market of the London Stock Exchange. As at the date of this document, the Company’s issued share capital is 17,186,664 Ordinary Shares and 23,069,931 ZDP Shares (Note 1).

The ZDP Shares currently carry the right to receive the 2017 Final Capital Entitlement at the end of their life and provide gearing for the Ordinary Shareholders. ZDP Shareholders are entitled to receive the 2017 Final Capital Entitlement of 138 pence per ZDP Share on 31 January 2017. Accordingly, the Company is committed (to the extent required) to repaying the aggregate 2017 Final Capital Entitlement of the ZDP Shareholders, of approximately £29.473 million, on that date.

Under the Articles, the Directors are required, every five years, to propose the Discontinuation Resolution that the Company should cease to continue as presently constituted. At the annual general meeting of the Company held on 26 September 2016, the Company’s third Discontinuation Resolution was proposed but not passed. This was in line with the Directors’ recommendation and your Board is pleased that Shareholders have expressed their support for the continuation of the Company in its present form. As announced by the Company on that date, the Board has been considering the refinancing of the ZDP Shares.

The Board considers that it is in the best interests of the Company to maintain the gearing afforded by the ZDP Shares after 31 January 2017 and to give ZDP Shareholders the opportunity to continue their investment in the Company. The Board proposes that the life of the ZDP Shares be extended such that they carry the right to receive the 2022 Final Capital Entitlement of 167.2 pence per ZDP Share on 28 February 2022. This represents a Gross Redemption Yield of 3.85 per cent. from the Effective Date (Note 2), which is a lower cost of gearing than the ZDP Shares currently represent.

The ability of the Company to pay the 2022 Final Capital Entitlement is dependent on the performance of the Company’s investment portfolios. The ZDP Shares are not a guaranteed, protected or secured investment and ZDP Shareholders may therefore not receive their full 2022 Final Capital Entitlement.

The Proposals therefore involve refinancing the ZDP Shares at what the Board believes is an attractive Gross Redemption Yield that should allow the Company to continue to provide Ordinary Shareholders with a high level of income, underpinned by the Company’s material revenue reserve, as well as the opportunity for further capital growth. The Board believes that there is strong support amongst ZDP Shareholders for an option that would enable them to continue all or some of their existing investment in the ZDP Shares.

3. Overview of the Proposals

The Proposals comprise:

(i) the adoption of the New Articles which will, inter alia, extend the term of the ZDP Shares to 28 February 2022 and provide for a 2022 Final Capital Entitlement of 167.2 pence per ZDP Share;

(ii) the Continuation Offer to ZDP Shareholders whereby such holders are given an opportunity to either receive their 2017 Final Capital Entitlement in cash on 31 January 2017 or to continue their investment in the ZDP Shares (or a combination thereof); and

(iii) the issue of New Ordinary Shares and New ZDP Shares pursuant to the Initial Placing and Offer and the Placing Programme.

A continuation of an investment in the ZDP Shares provides an alternative to the cash payment to which ZDP Shareholders are currently entitled on 31 January 2017 and will allow ZDP Shareholders who elect for the Continuation Option to continue their investment in the Company. As noted in the Circular, UK resident ZDP Shareholders who elect for the Continuation Option should not generally be treated as making a disposal for the purposes of UK taxation of chargeable gains as a result of doing so. It is important to note that the discussion of the tax treatment contained in the Circular is intended only as a general and non-exhaustive summary of the expected tax treatment and ZDP Shareholders are advised to seek independent professional advice as to the tax consequences for them of the Proposals.

4. Key features of the amended ZDP Shares

If the Proposals are adopted, the ZDP Shares:

·          will have a repayment date of 28 February 2022;

·          are designed to provide ZDP Shareholders accepting the Continuation Offer with a level of capital growth equivalent to a gross redemption yield of 3.85 per cent. per annum (Note 3);

·          subject to the Company having sufficient assets at the time, will carry the right to be paid the 2022 Final Capital Entitlement of 167.2 pence in cash on 28 February 2022; and

·          will benefit from enhanced Cover protection, as the Cover Test to be applied prior to any issuance of New ZDP Shares (including under the Issues) or any repurchase of Ordinary Shares and/or ZDP Shares by the Company will be increased from 1.85 times to 2.0 times.

Save as set out above, the rights of the ZDP Shares following the implementation of the Proposals will be the same as the rights of the existing ZDP Shares. The amended rights of the ZDP Shares are set out in the New Articles and are described in full in the Circular. The New Articles are summarised in their entirety in the Circular. The New Articles are available for inspection as set out in the Circular.

On the assumption that (i) the Company’s gross assets on the Calculation Date are £91.086 million, which were its gross assets on the Latest Practicable Date (less the estimated fixed costs of the Proposals); and (ii) 21,357,174 ZDP Shares remain in issue following the Effective Date with an Initial NAV per ZDP Share of 138 pence per ZDP Share, which will be the accrued capital entitlement of a ZDP Share as at the Effective Date, then it is expected that, following the Effective Date, the Company’s gross assets would need to fall by 15.9 per cent. per annum, in order for the ZDP Shares not to receive their full 2022 Final Capital Entitlement of 167.2 pence per New ZDP Share on 28 February 2022.

The ability of the Company to pay the 2022 Final Capital Entitlement is dependent on the performance of the Company’s investment portfolios. New ZDP Shares are not a guaranteed, protected or secured investment and ZDP Shareholders may therefore not receive their full 2022 Final Capital Entitlement.

5. The Continuation Offer

5.1 Options available to ZDP Shareholders in the Continuation Offer

Under the Continuation Offer, ZDP Shareholders who are on the Register as at the Record Date will be entitled to:

(i) receive their 2017 Final Capital Entitlement in cash on the 2017 Repayment Date (the ‘‘Cash Option’’);

(ii) elect to continue their investment in the ZDP Shares, the rights of which will be amended as set out in this document (the ‘‘Continuation Option’’); or

(iii) make different choices in respect of different parts of their holdings of ZDP Shares, as suits their personal investment objectives.

Details of the action to be taken by ZDP Shareholders in relation to the Continuation Offer are set out in the Circular.

ZDP Shareholders are recommended to choose the Option(s) they would prefer in respect of their ZDP Shares. The Form of Election need only be completed, or a TTE Instruction submitted, as appropriate, by ZDP Shareholders who wish to make a full or partial election for the Continuation Option. If ZDP Shareholders wish to receive only the Cash Option, no action needs to be taken.

The default option under the Continuation Offer will be the Cash Option, meaning that a ZDP Shareholder who, in respect of all or part of his or her holding of ZDP Shares, fails to submit a valid Form of Election or a valid TTE Instruction, as appropriate, by the due date or submits a Form of Election which has not been duly completed or an invalid TTE Instruction, will be deemed to have elected for the Cash Option in respect of such holding.

Overseas Shareholders will be deemed to have elected for the Cash Option in respect of their entire holding of ZDP Shares, save as provided at paragraph 5.5 below.

5.2 Mechanics of the Continuation Offer

The Continuation Offer will be implemented by way of (i) the adoption of the New Articles and (ii) the redemption of ZDP Shares in respect of which valid Elections are deemed to be made for the Cash Option, each on the Effective Date. No new securities will be issued by the Company in connection with the Continuation Offer, although New ZDP Shares will be available under the Initial Placing.

The New Articles contain the amended rights attaching to the ZDP Shares as set out in the Circular. The New Articles also contain a right attaching to all ZDP Shares in respect of which an Election has been deemed to be made for the Cash Option in accordance with the Proposals set out in this document for such ZDP Shares to be redeemed on 31 January 2017 at a redemption price of 138 pence per ZDP Share (being the 2017 Final Capital Entitlement).

If the Proposals are approved by Shareholders, on the Effective Date:

(i) the New Articles will be adopted; and

(ii) ZDP Shares in respect of which an Election has been deemed to be made for the Cash Option will be entitled to receive the 2017 Final Capital Entitlement on 31 January 2017.

ZDP Shareholders who have validly Elected for the Continuation Option shall continue to hold ZDP Shares on the amended terms as set out in the New Articles.

The Continuation Offer will be conducted on the terms set out in this document and, to the extent applicable, the New Articles. In the case of any discrepancy between this document and the New Articles, the terms of the New Articles will prevail. The Directors have absolute discretion to determine any procedural or administrative matter in respect of the Continuation Offer, including as to whether an Election has been validly made.

5.3 Dealings in ZDP Shares

The latest time and date for receipt of the Forms of Election or TTE Instructions from ZDP Shareholders in respect of the Continuation Offer is 5.00 p.m. on 13 January 2017. A purchaser of ZDP Shares after this time will not be entitled to make an Election under the Continuation Offer.

The Record Date, being the date for determining which ZDP Shareholders are entitled to participate in the Continuation Offer, is 5.00 p.m. on 31 January 2017.

The ZDP Shares will all be disabled in CREST after close of business on 31 January 2017 and the existing ISIN number GG00B4W1FT21 (the ‘‘Old ISIN’’) will expire. The new ISIN number GG00BYMJ7X48 (the ‘‘New ISIN’’) in respect of the ZDP Shares which have not been redeemed will be enabled and available for transactions from and including 1 February 2017.

Up to and including 31 January 2017, ZDP Shares will be traded under the Old ISIN and, as such, a purchaser of such ZDP Shares should confirm with the seller whether the ZDP Shares being purchased have been elected for the Continuation Offer. Absent such confirmation, the buyer would have a market claim for the equivalent of the redemption proceeds of such ZDP Shares.

CREST will automatically transform any open transactions as at the close of business on 31 January 2017 into the New ISIN.

If ZDP Shareholders dispose of their ZDP Shares otherwise than through the London Stock Exchange, they must make their own arrangements with the other parties concerned as regards entitlement under the Continuation Offer.

5.4 Share certificates and payment of cash entitlements

The Cash Option

Existing certificates in respect of ZDP Shares in respect of which elections are deemed to have been received for the Cash Option will cease to be of value for any purpose on the Effective Date, and any existing credit of such ZDP Shares in any stock account in CREST will be cancelled.

If the Proposals become effective, cheques or BACS payments in respect of the 2017 Final Capital Entitlements due to ZDP Shareholders who are deemed to have elected for the Cash Option are expected to be despatched by the Receiving Agent on 3 February 2017.

All documents and remittances despatched to or from ZDP Shareholders or their appointed agents in connection with the Proposals will be despatched at Shareholders’ own risk and no acknowledgement will be issued for receipt of Forms of Election or TTE Instructions.

The Continuation Option

ZDP Shareholders who hold their ZDP Shares in certificated form and who elect for the Continuation Option will receive replacement certificates in respect of their ZDP Shares. Existing certificates in respect of ZDP Shares in respect of which elections are made for the Continuation Option will cease to be of value for any purpose, and any existing credit of such ZDP Shares in any stock account in CREST will be cancelled, following the despatch to ZDP Shareholders of share certificates in respect of the continuing ZDP Shares (or, in the case of ZDP Shareholders previously holding their ZDP Shares in uncertificated form, the appropriate stock accounts in CREST of such ZDP Shareholders are credited with their respective entitlements to continuing ZDP Shares).

5.5 Overseas Shareholders

ZDP Shareholders who are Overseas Shareholders will not receive a Form of Election and will (unless the Directors determine otherwise) receive their 2017 Final Capital Entitlement in cash in respect of their entire holding of ZDP Shares, unless they have satisfied the Directors that it is lawful for the Continuation Offer to be made and for the Continuation Option to be accepted by them under any relevant overseas laws and regulations.

5.6 Taxation

The attention of ZDP Shareholders is drawn to the Taxation section of the Circular which sets out a general guide to certain aspects of current UK and Guernsey taxation law and HMRC published practice.

6. Adoption of New Articles

It is proposed that, with effect from the Effective Date, the Company adopts the New Articles in replacement of the Existing Articles. The New Articles will set out the amended rights of the ZDP Shares as provided for by the Proposals.

The New Articles will also make certain other changes from the existing Articles to reflect recent changes in Guernsey company law and to update them generally.

The amended rights of the ZDP Shares as set out in the New Articles are described in full in the Circular. The New Articles are summarised in their entirety in the Prospectus. The Existing Articles and the New Articles (including a comparison document showing the changes between the two) are available for inspection as set out in the Circular.

7. The Issues

The Initial Placing of New ZDP Shares is intended to allow the Company to maintain its existing capital structure following the implementation of the Proposals, through the issue of New ZDP Shares to replace those ZDP Shares in respect of which elections are deemed to be made for the Cash Option.

The Directors also believe that it is in the interests of the Company for existing Shareholders and new investors to have the opportunity to subscribe for further Ordinary Shares. The Company is therefore proposing the Initial Placing and Offer of New Ordinary Shares, and the Placing Programme which is designed to enable the Company to satisfy subsequent demand for New Ordinary Shares and New ZDP Shares. To the extent that there are applications for New Ordinary Shares under the Initial Placing and Offer, the Company will have the ability to issue additional New ZDP Shares under the Initial Placing to allow the Company to maintain its existing capital structure following the implementation of the Proposals.

It is the Company’s intention to target an Initial Placing and Offer size that will maintain the current balance of the Company’s capital structure. The ratio of Ordinary Shares to ZDP Shares currently in issue is 1 : 1.3423134 (the ‘‘Target Ratio’’) and, following completion of the Continuation Offer and the Initial Placing and Offer, the Company intends to approximately maintain the Target Ratio. The number of New ZDP Shares that may be issued under the Initial Placing is limited accordingly. The Directors have no present intention to issue further New ZDP Shares after Admission of the Initial Placing and Offer Shares except to the extent that, following the Effective Date, the number of ZDP Shares for each Ordinary Share in issue is less than the Target Ratio (meaning that the gearing on the Ordinary Shares is less than intended). The Directors also reserve the ability to issue further ZDP Shares on an ongoing basis under the Placing Programme (subject to the Cover Test).

In planning the proposed capital structure of the Company, the Directors have had regard to the requirement to maintain a balance between, on the one hand, the objective of providing a competitive yield and security of repayment for the ZDP Shareholders and, on the other hand, the objective of providing Ordinary Shareholders with a high level of income coupled with capital growth over the long-term.

The Initial Issue Price per New Ordinary Share will be determined by the Company as the price equal to the cum-income Net Asset Value per Ordinary Share on the Calculation Date plus a 1 per cent. premium.

The Initial Issue Price per New ZDP Share will be determined by the Company.

The Company may only issue New ZDP Shares under the Placing Programme in circumstances where, immediately following such issue (i) the Cover Test is met; or (ii) Cover is otherwise increased.

At the Extraordinary General Meeting, the Company is seeking approval from Shareholders to issue New Ordinary Shares and New ZDP Shares on a non-pre-emptive basis, subject to certain parameters. These authorities are intended to allow the Initial Placing and Offer to be undertaken and, thereafter, to allow the Company to issue Shares under the Placing Programme.

Further details of the Issues are set out in the Prospectus.

8. Conditions to the Proposals

8.1 The Continuation Offer is conditional upon:

8.1.1 the passing of the Resolutions to be proposed at the ZDP Class Meeting, the Ordinary Class Meeting and the Extraordinary General Meeting and upon any conditions of such Resolutions being satisfied; and

8.1.2 the Minimum ZDP Class Size being achieved.

8.2 In addition to the conditions set out above, the Initial Placing and Offer is conditional, inter alia, on:

8.2.1 the Placing and Offer Agreement becoming wholly unconditional (save as to Admission of the Initial Placing and Offer Shares) and not having been terminated in accordance with its terms prior to such Admission; and

8.2.2 Admission of the Initial Placing and Offer Shares occurring by 8.00 a.m. on 1 February 2017 (or such later date as the Company and Numis may agree in writing, being not later than 8.00 a.m. on 28 February 2017).

8.3 In addition to the conditions set out above, the Placing Programme is conditional, inter alia, on:

8.3.1 the Placing and Offer Agreement not having been terminated in accordance with its terms prior to the Admission of the New Shares issued pursuant to such issue under the Placing Programme;

8.3.2 the Placing Programme Price being determined by the Directors as described in the Prospectus;

8.3.3 in respect of any issue of New ZDP Shares, immediately following such issue (i) the Cover Test would be met, or (ii) Cover would be otherwise increased;

8.3.4 Admission of the New Shares issued pursuant to such issue under the Placing Programme; and

8.3.5 a valid prospectus being published by the Company if such is required by the Prospectus Rules.

9. Costs of the Proposals

The Company estimates that it will incur costs of approximately £390,000 in respect of the development and implementation of the Proposals.

The Company will also incur variable costs in connection with the Issues, which includes commission payable to Numis, which will increase in line with the total amount raised pursuant to the Issues.

It is expected that these costs will be substantively covered by the premium generated on issuing the New Ordinary Shares (and potentially the New ZDP Shares) at the Initial Issue Prices.

10. Certain considerations relating to the Proposals

The implementation of, and an Election for the Continuation Offer under, the Proposals carry with them certain considerations for Shareholders as described below:

·          ZDP Shareholders will need to consider the tax consequences of the Proposals, based on their particular circumstances. As described in the Circular, UK resident ZDP Shareholders who are deemed to elect for the Cash Option will generally be treated as a making a disposal of their existing ZDP Shares and may incur a tax liability as a result. Similarly, ZDP Shareholders who elect to continue some or all of their entitlement in the ZDP Shares may incur tax liabilities on any subsequent disposal of their ZDP Shares. Shareholders who are in any doubt as to the tax consequences of the Proposals should seek independent professional advice. ZDP Shareholders who elect to continue their investment in the ZDP Shares pursuant to the Continuation Offer should not generally be treated as making a disposal for the purposes of UK taxation of chargeable gains as a result of doing so;

·          the default option under the Continuation Offer is for a ZDP Shareholder to receive the 2017 Final Capital Entitlement in cash on 31 January 2017. ZDP Shareholders making no Election under the Continuation Offer will therefore receive cash;

·          the ZDP Shares are designed to be held over the long-term and may not be suitable as short-term investments. There can be no guarantee that any appreciation in the value of the Company’s investments will occur and investors may not get back the full value of their investment. The past performance of the Company is not a guide to the future performance of the Company;

·          there can be no guarantee that the investment objective of the Company will be achieved. A failure to meet the investment objective may have a material adverse effect on the ability of the Company to pay the 2022 Final Capital Entitlement in full on 28 February 2022;

·          the ZDP Shares rank prior to the Ordinary Shares in respect of the Final Capital Entitlement, save in respect of any undistributed income of the Company standing to the credit of the Company’s accounting revenue reserves. Although that is the case, on a return of assets, including the winding-up of the Company, ZDP Shareholders would only receive payment if there are sufficient assets of the Company and having regard to all other unsecured liabilities of the Company. ZDP Shares are not a secured, protected or guaranteed investment; and

·          Ordinary Shareholders should be aware that the level of gearing afforded by the ZDP Shares may change depending on the results of the Proposals. To the extent that existing ZDP Shareholders do not elect to continue their investment in ZDP Shares, the Company will seek to issue New ZDP Shares to rebalance the Company’s gearing as indicated at paragraph 7 above. However, there can be no guarantee that the Issues will be successful. In the event that materially fewer ZDP Shares remain in issue following the Effective Date, the gearing, and therefore revenue earnings per Ordinary Share, may be materially less than historically. This may result in the dividend yield of the Ordinary Shares being materially lower than historically. In such an event the Board may consider proposals for increasing the gearing of the Company otherwise than by the ZDP Shares.

The choice between the Options available under the Continuation Offer will be a matter for each ZDP Shareholder to decide and will be influenced by their individual circumstances and investment objectives. ZDP Shareholders should, before making any Election, read carefully the information on the Options in this document and the accompanying Prospectus in relation to the Company.

Shareholders who are in any doubt as to the contents of this document or as to the action to be taken should immediately seek their own personal financial advice from their independent professional adviser authorised under the Financial Services and Markets Act 2000.

11. The Meetings

The implementation of the Proposals requires Shareholder approval at the following Meetings:

·          the passing by ZDP Shareholders of the ordinary resolution to be proposed at the ZDP Class Meeting;

·          the passing by Ordinary Shareholders of the special resolution to be proposed at the Ordinary Class Meeting; and

·          the passing by Ordinary Shareholders and ZDP Shareholders (voting together) of Resolution 1, and by Ordinary Shareholders alone of Resolutions 2 to 7 (inclusive) to be proposed at the Extraordinary General Meeting.

Notices of the ZDP Class Meeting, the Ordinary Class Meeting and the Extraordinary General Meeting, which have been convened for 20 December 2016, are set out in the Circular.

12. Expected timetable

2016
Latest date for receipt of forms of proxy 16 December
ZDP Class Meeting 2.00 p.m. on 20 December
Ordinary Class Meeting* 2.05 p.m. on 20 December
Extraordinary General Meeting* 2.10 p.m. on 20 December
Publication of the results of the Meetings 20 December
2017
Latest time and date for receipt of the Forms of Election or TTE Instructions from ZDP Shareholders in respect of the Continuation Offer* 5.00 p.m. on 13 January
Latest time and date for receipt of Application Forms under the Offer for Subscription 11.00 a.m. on 20 January
Calculation Date 25 January
Publication of the Initial Issue Prices 27 January
Latest time and date for receipt of commitments under the Initial Placing 11.00 a.m. on 27 January
Record Date for entitlement to the Continuation Offer 5.00 p.m. on 31 January
Publication of the results of the Continuation Offer and the Initial Placing and Offer 31 January
Effective Date of the Proposals 31 January
Admission and dealings in the Initial Placing and Offer Shares commence 8.00 a.m. on 1 February
CREST accounts of ZDP Shareholders who elect for the Continuation Option credited with amended ZDP Shares (for holders in uncertificated form) as soon as practicable after 8.00 a.m. on 1 February
Consideration expected to be despatched to ZDP Shareholders who are deemed to have elected for the Cash Option via cheque or BACS 3 February
Despatch of (i) replacement ZDP Share certificates to ZDP Shareholders who elect for the Continuation Option (to holders in certificated form) and (ii) despatch of certificates for the Initial Placing and Offer Shares (for holders in certificated form) in the week commencing 6 February

* Or as soon thereafter as the preceding Meeting concludes or is adjourned.

** ZDP Shareholders who wish to receive the 2017 Final Capital Entitlement in respect of their entire holding of ZDP Shares in cash do not need to complete a Form of Election or send a TTE Instruction and will be deemed to have elected for the Cash Option.

All of the times and dates in the expected timetable may be extended or brought forward without further notice. If any of the above times and/or dates change materially, the revised time(s) and/or date(s) will be notified to Shareholders by an announcement through a Regulatory Information Service provider.

All references to time in this document are to UK time.

13. Notes

1 Of which, 1,275,972 Ordinary Shares and 1,712,757 ZDP Shares are held in treasury.

2 Based on the Initial NAV per ZDP Share on the Effective Date, being 138 pence. The Initial Issue Price per New ZDP Share under the Issues may differ from the indicative issue price available under the Continuation Offer.

3 Based on the Initial NAV per ZDP Share on the Effective Date, being 138 pence, and therefore represents the prospective return for ZDP Shareholders under the Continuation Offer. The Initial Issue Price per New ZDP Share under the Issues, and therefore the prospective return under the Initial Placing, may differ.

4 Capitalised terms used but not defined in this announcement will have the same meaning as set out in the Circular dated 29 November 2016.

5 A copy of the Circular and Prospectus will shortly be submitted to the National Storage Mechanism and will be available for inspection at www.morningstar.co.uk/uk/NSM.