Aberdeen Frontier Mkts Inv Co Ltd Result of EGM and Tender Offer Result (4652Z)

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RNS Number : 4652Z

Aberdeen Frontier Mkts Inv Co Ltd

14 March 2017

Aberdeen Frontier Markets Investment Company Limited

Result of Extraordinary General Meeting ("EGM") and Tender Offer Result

14 March 2017

Result of EGM

Aberdeen Frontier Markets Investment Company Limited (the "Company") announces that both of the resolutions put forward at the EGM held today have been passed. As described in the circular to shareholders and notice of EGM dated 3 February 2017 (the "Circular"), resolution 1 was to approve the new Investment Objective and Policy of the Company and resolution 2 was to approve the Tender Offer.

Terms used and not defined in this announcement shall have the meaning given to them in the Circular.

Tender Offer

The Company has received valid tender acceptances of 97,307,392 Ordinary Shares of the Company representing 57.57 per cent of the Ordinary Shares in issue excluding shares in treasury. Numis is seeking to sell some of such tendered Ordinary Shares to Incoming Investors at the Investment Price.

Any Ordinary Shares not sold by Numis to Incoming Investors will be repurchased by the Company. Tendering Shareholders will receive the full Tender Price in cash for the Exit Shares (including the On-sale Shares) only once all of the assets in the Tender Pool have been fully realised. However, if and when an interim distribution from the Tender Pool is made, the amount received by Tendering Shareholders will include an amount in respect of their pro rata proportion of any On-sale Shares.

Aberdeen has agreed with the Company that it will invest GBP10 million (inclusive of any transfer taxes and costs) in the Company provided this investment does not represent more than 20 per cent. of the issued share capital of the Company immediately following the Tender Offer. This commitment shall be satisfied by Aberdeen purchasing On-sale Shares from Numis.

The Tender Offer FAV and number of On-sale Shares are expected to be announced on 16 March 2017.

New Investment Objective and Policy

The investment objective of the Company going forward is to generate long-term capital growth primarily from investment in equity and equity related securities of companies listed in, or operating in, Frontier Markets.

Frontier Market countries may include constituents of the MSCI Frontier Markets Index or additional countries that the Investment Manager deems to be, or displays similar characteristics to, Frontier Market countries.

The new Investment Policy is as follows:

The Company will seek to maximise total return and will invest globally in the securities of companies domiciled or listed or quoted in, or exercising the predominant part of their economic activity in, Frontier Markets.

A Frontier Market is defined as:

    --      any country that is a constituent of the MSCI Frontier Markets Index; or 

-- any country that in the view of the Manager shares similar characteristics to those of Frontier Markets (such as low per capita GDP, high growth potential or less developed capital markets).

The Manager may also invest in equity securities of companies that are listed or quoted in developed or emerging markets but have significant business exposure in terms of revenues, profits, assets or employees, to Frontier Markets.

No individual listed or quoted company exposure in the portfolio may exceed 10 per cent. of the Company's total assets at the time of investment. The Company may invest in exchange-traded funds provided they are listed on a recognised investment exchange.

In order to achieve the Investment Objective, the Manager selects stocks by fundamental analysis of companies, looking for long-term appreciation from mispriced value or growth. The Manager employs an actively managed bottom-up approach to investing whilst always having due regard to the requirement for portfolio diversification across sectors and countries. Risk is spread through investing in a number of holdings and, typically, it is expected that the Company will invest in between 30 to 80 holdings.

The Company has not set maximum or minimum exposures for any geographical regions or sectors and will achieve an appropriate spread of risk by investing in a diversified portfolio of securities. Where possible, investment will generally be made directly in the stock markets of Frontier Markets with a medium to long term investment horizon. Where the Manager determines appropriate, investment may be made in Frontier Markets through collective investment schemes.

No more than 10 per cent. of the Company's total assets may be invested in other listed closed ended investment companies, provided that this restriction does not apply to investments in any such investment companies which themselves have published investment policies to invest no more than 15 per cent. of their total assets in other closed-ended investment companies.

Additionally, the Company will itself not invest more than 15 per cent. of its total assets in other investment companies or investment trusts which are listed or quoted. The Company may, at the Manager's discretion, hold cash or cash equivalents to protect Shareholders' capital although it is envisaged that the value of these will not generally exceed 10 per cent. of Net Asset Value.

It is intended that the Company will generally be invested in equity investments. However, the Manager may invest in equity related investments such as convertibles or fixed interest securities where there are perceived advantages in doing so.

The Company may use gearing, in the form of borrowings and/or derivatives, to enhance returns over the long term. The borrowings may be in sterling or other currencies. The Articles of Incorporation contain a borrowing limit equal to 10 per cent. of its Net Assets (calculated at the time of draw down). Total gearing, including any net derivative exposure, would not normally be expected to result in a net economic equity exposure in excess of 110 per cent. Furthermore, the Company may use an overdraft and/or other short-term borrowing facilities to meet its working capital needs, including for the payment of any expenses or fees. The same facility may be used to take advantage of favourable investment opportunities pending the payment of proceeds from the sale of investments.

Due to national and/or international regulation, excessive operational risk, prohibitive costs and/or the time period involved in establishing trading and custody accounts in certain of the Company's target Frontier Markets, the Company may temporarily, or, on an on-going basis, be unable to invest (whether directly or through nominees) in certain of its target Frontier Markets or, in the opinion of the Company and/or the Manager, it may not be advisable to do so. In such circumstances, the Company may gain economic exposure to such target Frontier Markets by investing indirectly through derivatives (including contracts for difference) and/or structured financial instruments, for example P-Notes. Save as provided above, there is no restriction on the Company investing in derivatives and/or structured financial instruments in such circumstances. If the Company invests in derivatives and/or structured financial instruments for investment purposes (other than to gain access to a target Frontier Market as described above) and/or for efficient portfolio management purposes it shall only hold up to, in aggregate, 10 per cent. of its Gross Assets in derivatives and/or structured financial instruments for such purposes.

The information contained within this announcement is considered to be inside information prior to its release as defined in Article 7 of the Market Abuse Regulation No. 596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

14 March 2017

www.aberdeenfrontiermarkets.co.uk

Enquiries:

Aberdeen Fund Managers Limited (Investment Manager to Aberdeen Frontier Markets Investment Company Limited)

   William Hemmings / Gary Jones             Tel: [phone] 

Grant Thornton UK LLP (Nominated Adviser)

   Philip Secrett                 Tel: [phone] 

Numis Securities Limited (Nominated Broker)

   David Benda                Tel: [phone] 

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March 14, 2017 12:15 ET (16:15 GMT)