Alternative Liquidity Solutions Ltd Publication of Prospectus and Placing (3224O)

TIDMALSL

RNS Number : 3224O

Alternative Liquidity Solutions Ltd

10 October 2012

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR PUBLICATION, RELEASE, OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN, OR INTO, THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL OR TO U.S. PERSONS. THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE INCLUDING IN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR TO U.S. PERSONS.

Alternative Liquidity Solutions Limited (the "Company")

Placing of up to 250,000,000 Ordinary Shares

and

Publication of a Prospectus

10 October 2012

Publication of Prospectus and Placing

-- The Board of Directors of Alternative Liquidity Solutions Limited is pleased to announce that a Prospectus has been published setting out details of a placing of up to 250,000,000 Ordinary Shares.

-- The Placing is being conducted to raise funds to pursue the revised investment objective for the Company's Ordinary Shares of targeting a gross IRR on investments of at least 20 per cent. per annum over the lifetime of the investment. The Company will seek to achieve this by purchasing illiquid hedge fund assets through the secondary market at substantial discounts to reported net asset value.

-- The Issue Price will be determined by the Board immediately prior to the Placing, with the intention that Placing Shares be issued at or close to the prevailing Net Asset Value per Ordinary Share.

-- The latest time and date for receipt of Placing commitments is 3.00 p.m. on 18 October 2012. Application has been made to the UK Listing Authority and the London Stock Exchange for all of the Placing Shares to be admitted to the Official List and to trading on the Main Market. It is expected that such admissions will become effective and that dealings in the Placing Shares will commence on 24 October 2012.

-- A copy of the Prospectus is being sent to each of the Company's shareholders, together with Forms of Election to allow shareholders to determine whether they wish to maintain their investment in the Ordinary Shares or to have their Ordinary Shares converted into Run-Off Shares.

The Opportunity

-- It is estimated that there are currently over US$50bn of illiquid hedge fund secondary interests in the world (source: Deutsche Bank/UBS).

-- Whilst mainstream equity markets have generally recovered since the credit crunch, the pricing of illiquid secondary hedge fund interests has generally continued to deteriorate. Over three years of unfulfilled liquidity expectations have made many holders keen to sell such interests.

-- A secondary market for hedge fund interests has developed where some investors have sought liquidity for their exposure. In the illiquid hedge fund space in particular, it has been possible to buy residual interests at a discount to their expected recovery values.

-- Dakota has been appointed as the investment adviser in relation to the Company. Dakota has a strong track record in investing in secondary hedge fund interests having executed 72 portfolio purchases comprising 280 underlying fund interests since June 2010 at a weighted average discount of 67 per cent.

-- The Board expects Dakota's experience and successful track record will help to lower execution risk. In addition, the Board believes that Dakota's strategy of buying smaller lot sizes (which often trade at wider discounts to net asset value) gives it a competitive advantage over other buyers which are typically large institutions managing over US$250 million of assets and who therefore require sizeable transactions.

Expected timetable

Each of the times and dates set out below and mentioned elsewhere in this announcement may be adjusted by the Company, in which event details of the new times and dates will be notified to the FSA and the London Stock Exchange. References to a time of day are to London time.

2012

 
 Share redesignation Record         close of business on 4 October 
  Date 
 Latest time and date for receipt          3.00 p.m. on 18 October 
  of Placing commitments 
 Latest date for receipt of               11.00 a.m. on 22 October 
  forms of election for Share 
  Redesignations 
 Share Redesignations become                            23 October 
  effective 
 Results of Placing announced                           23 October 
  via RNS 
 Dealings commence in the Placing                       24 October 
  Shares and CREST stock accounts 
  credited against payment for 
  Placing Shares 
 Share certificates in respect                          24 October 
  of Placing Shares despatched 
 

END

Contacts

Jon Macintosh/Ben Money-Coutts 020 7499 0200

Saltus Partners LLP

Will Barnett/David Yovichic 020 7523 8000

Canaccord Genuity

Harry Stein 020 7269 7141

FTI Consulting

Additional Information

Background

At the 2012 annual general meeting of the Company, Shareholders approved the adoption of a revised investment policy, the undertaking of the Placing and the restructuring of the Company to allow Shareholders either to maintain their investment in the Company and/or exit their investment through the reclassification of their Ordinary Shares as Run-Off Shares.

New investment objective and policy

(a) Ordinary Shares

Following the reclassification of the Company's share capital, the investment objective for the Company in relation to its Ordinary Shares will be to target a gross internal rate of return on its investments of at least 20 per cent. per annum over the lifetime of the investment. The Company's investment policy in pursuing this objective will be to purchase illiquid hedge fund assets through the secondary market at substantial discounts to reported net asset values. Sellers of such assets are anticipated to be motivated sellers of interests in funds and other securities which are not otherwise readily realisable. The acquisition of such assets is expected to give rise to opportunities to build an attractive portfolio of investments, purchased at a discount to fair value, given the high level of motivation on the part of some investors to achieve liquidity quickly. The Company expects to construct a diversified portfolio of between 50 and 100 underlying fund positions, each purchase usually being of less than US$10 million in reported net asset value.

The portfolio is expected to comprise predominantly illiquid interests in funds and other instruments and securities, purchased through the secondary market. These will include hedge funds, structured products, real estate funds and life settlement policies, as well as fund of funds interests comprising portfolios of such funds. It may also include individual assets and portfolios of assets likely to have been owned by the above-mentioned types of funds. These assets are expected to be mainly in the credit, distressed securities, asset backed lending and fixed income sectors, as well as in illiquid and unquoted real estate and equity positions. The Company may invest in longer lock-up funds purchased at discounts to fair value in the secondary market, and may also provide short-term bridge financing against redemptions and audit hold-backs (being retentions of redemption proceeds pending completion of final audits). The Company may also invest in loans and other debt securities issued by funds and fund of funds, particularly where such loans are in actual or potential default. Given the nature of the market, it should be noted that portfolio construction will likely be opportunity driven rather than optimised from a diversification perspective.

The portfolio will not be constructed to have any particular geographical bias. Accordingly, the Company's ability to source and buy assets across the world (in which the Investment Adviser has a proven track record) is a strong differentiating factor.

The Investment Adviser expects that the Company will be fully invested within 12 to 18 months, with some positions bought for cash flow and others for deep value. The Investment Adviser also expects that, for the majority of illiquid fund interest purchases, the cash purchase price for an investment will be recovered within 18 to 24 months and exits achieved through a combination of underlying cash flows and opportunistic secondary sales. The average investment life of each such investment is expected to be between three and four years.

The Board and its advisers consider that there is likely to be a limited window of opportunity for generating the Company's targeted returns as the supply of illiquid assets created in the aftermath of the credit crunch diminishes and the secondary market matures. In view of this limited window, the Company will hold a continuation vote in relation to the Ordinary Shares Investment Policy at its annual general meeting in 2014. This vote will require a simple majority of Ordinary Shareholders present in person or by proxy to vote in favour for the Company to maintain the Ordinary Shares Investment Policy. Thereafter a continuation vote will be proposed at each subsequent annual general meeting requiring a majority of not less than 75 per cent. of Ordinary Shareholders present in person or by proxy to vote in favour in order for the Company to maintain the Ordinary Shares Investment Policy. Immediately upon any such continuation resolution not being passed, the Ordinary Shares will become automatically subject to a managed wind-down.

(b) Run-Off Shares

Following the Share Redesignations, the investment objective and policy of the Company in relation to the Run-Off Shares Pool will be to realise the Run-Off Shares Pool's existing investments in an orderly and timely manner, with a view to distributing cash to Run-Off Shareholders pro rata to their holdings of Run-Off Shares at appropriate times as sufficient investments are realised. The Company will not make any new investments in the Run-Off Pool other than to meet pre-existing commitments or in cash or cash equivalents pending distribution of cash to Run-Off Shareholders. The Company may, however, make follow-on investments which it believes are necessary to protect the value of existing investments.

The return of cash to Run-Off Shareholders will be effected through the compulsory redemption of Run-Off Shares on a pro rata basis to all Run-Off Shareholders. All Run-Off Shareholders will be treated equally under the compulsory redemptions.

As the costs of maintaining a listing are significant and Run-Off Shareholders are likely to derive little benefit from it due to the expected illiquidity of trading in the Run-Off Shares (which would be likely to become even more pronounced as the size of the class reduced) it is not proposed to list the Run-Off Shares.

The Placing

Up to 250,000,000 Ordinary Shares in aggregate may be issued pursuant to the Placing. The Issue Price will be determined by the Board immediately prior to the Placing, with the intention that Placing Shares should be issued at or close to the prevailing Net Asset Value per Ordinary Share.

The Net Proceeds of the Placing are being raised for the purposes of implementing, and will be applied in accordance with, the new investment objective in respect of the Ordinary Shares as explained above.

The Placing is conditional on at least 40 per cent. of existing Shareholders (by value) not electing to have their Ordinary Shares re-designated as Run-Off Shares at the time of the Placing; and the Ordinary Shares Net Asset Value post the Placing being at least GBP35 million (after the costs and expenses of the Placing). The Company has received undertakings from certain shareholders, including Saltus Partners LLP and Sandalwood Securities, in respect of 15,265,171 Shares (representing, in aggregate 42.6 per cent. of the Shares in issue) not to elect for their Ordinary Shares to be converted into Run-Off Shares.

The Placing Shares are being conditionally placed at the Issue Price with institutional investors subject to, inter alia, the Placing Agreement becoming unconditional. Under the terms of the Placing Agreement, Canaccord have agreed to use their reasonable endeavours to procure Placees for the Placing Shares. Commitments under the Placing must be received by Canaccord no later than 3.00 p.m. on 18 October 2012.

Management of existing portfolio

If the Placing proceeds, the Directors will allocate the assets and liabilities of the Company between the Ordinary Shares Pool and the Run-Off Shares Pool in accordance with the principles concerning asset allocation set out below. Redemption requests have been placed in respect of all of the Company's investments which are open to redemption. A significant majority of these proceeds are expected to be recovered by the Company over the course of the next twelve months. In addition, the illiquid elements of the portfolio are continuing to perform in line with expectations and are returning capital on a regular basis.

Immediately following completion of the Placing, the assets of the Ordinary Shares Pool will consist of:

- that part of the Company's existing portfolio which is allocated to the Ordinary Shares Pool in accordance with the Company's asset allocation policy set out below; and

   -           the proceeds of the Placing. 

The Directors anticipate that, subject to the advice of the Investment Adviser, the existing assets in the Ordinary Shares Pool will be realised in an orderly manner and the proceeds thereof invested in accordance with the Ordinary Shares Investment Policy. The proceeds of the Placing will be invested in accordance with the Ordinary Shares Investment Policy.

Asset allocation

In accordance with the Articles, the Directors will allocate the assets and liabilities of the Company between a pool reserved for the Ordinary Shares (the "Ordinary Shares Pool") and a pool reserved for the Run-Off Shares (the "Run-Off Pool") in accordance with the following principles:

-- prior to the Share Redesignations, all of the assets and liabilities of the Company shall be allocated to the Ordinary Shares Pool;

-- if immediately following the Share Redesignations, the only shares in issue are Run-Off Shares, all of the assets and liabilities of the Company shall be allocated to the Run-Off Pool;

-- if immediately following the Share Redesignations, but before the issue of Ordinary Shares pursuant to the Placing, both Ordinary Shares and Run-Off Shares are in issue, the assets and liabilities of the Company shall be allocated as between the Ordinary Shares Pool and the Run-Off Pool pro rata (without "cherry-picking") across assets and liabilities to the percentage of the entire issued share capital of the Company which the Ordinary Shares and the Run-Off Shares respectively hold. For example, if following the Share Redesignations, there are 100 million Shares in issue, of which 80 million are Ordinary Shares and 20 million are Run-Off Shares, the Ordinary Shares Pool shall comprise 80 per cent. of the assets and liabilities of the Company at that time and the Run-Off Pool shall comprise 20 per cent. of the assets and liabilities of the Company at that time;

-- any new money raised by the issue of Ordinary Shares (including pursuant to the Placing) shall be allocated to the Ordinary Share Pool; and

   --    all the expenses of the Placing will allocated to the Ordinary Share Pool. 

Once assets and liabilities have been allocated to either the Run-Off Pool or the Ordinary Share Pool, they will be segregated (in accounting terms but not physically or legally) such that:

-- the assets and liabilities of the Run-Off Pool will be managed in accordance with the Run-Off Shares Investment Policy;

   --    distributions out of the Run-Off Pool can only be made on Run-Off Shares; 
   --    Ordinary Shares are not entitled to participate in the Run-Off Pool on a liquidation; 

-- market acquisitions of Ordinary Shares may only be made using the assets of the Ordinary Shares Pool and any accretion to net asset value as a result of market acquisitions of Ordinary Shares shall be for the account of the Ordinary Shares Pool;

-- the assets and liabilities of the Ordinary Shares Pool will be managed in accordance with the Ordinary Shares Investment Policy;

   --    distributions out of the Ordinary Shares Pool can only be made on Ordinary Shares; and 
   --    Run-Off Shares are not entitled to participate in the Ordinary Share Pool on a liquidation. 

Automatic redesignation of Ordinary Shares

Notwithstanding any election made by a Shareholder, in accordance with the Articles, if either:

   --    the Placing is not completed in accordance with its terms on or before 31 December 2012; or 

-- prior to 31 December 2012, the Company announces publicly that the Directors have concluded that there is no realistic prospect of the Placing being completed in accordance with its terms on or before 31 December 2012,

subject to applicable law and regulation, all of the Ordinary Shares in issue shall automatically be redesignated as Run-Off Shares. As noted above, the costs of maintaining a listing are significant and Run-Off Shareholders are likely to derive little benefit from it due to the expected illiquidity of trading in the Run-Off Shares (which would be likely to become even more pronounced as the size of the class reduced). Accordingly, it is not proposed to list the Run-Off Shares.

Life of the Company

Although the Company does not have a fixed life, the Directors believe that the window of opportunity for the Company's investment strategy to meet the targeted investment returns is likely to be of relatively short duration. Accordingly, the Board considers it desirable to give Ordinary Shareholders periodic opportunities to review the future of the Company as described below.

Discount management provisions

As a listed closed-ended share class, there is always the possibility of the Ordinary Shares trading at a discount to their Ordinary Share Net Asset Value. The Directors have given detailed consideration to the discount risk and how this can be managed.

1. Continuation Vote

The Company will have an initial investment period of approximately 12 to 18 months after which time Ordinary Shareholders will have the opportunity to vote on the investment policy relating to the Ordinary Shares at the Company's annual general meeting to be held in 2014. This vote will require a simple majority of Ordinary Shareholders present in person or by proxy to vote in favour for the Company to maintain the Ordinary Shares Investment Policy. Thereafter a continuation vote will be proposed at each subsequent annual general meeting requiring a majority of not less than 75 per cent. of Ordinary Shareholders present in person or by proxy to vote in favour in order for the Company to maintain the Ordinary Shares Investment Policy.

Immediately upon any continuation resolution not being passed, the Ordinary Shares will become automatically subject to a managed wind-down.

2. Adoption of Valuation Methodology

The Company has adopted the Valuation Methodology which the Directors believe is more conservative than is the industry norm amongst other listed funds holding hedge fund assets. Rather than simply reporting the value of the Company's portfolio based upon valuations provided by underlying managers and their administrators, the Valuation Methodology considers the price at which the Company has acquired assets (which will typically be at a discount to the underlying managers' reported net asset value) and, among other factors, the present value of expected future recoveries, discounted at a rate appropriate for the level of uncertainty over quantum and timeframe.

The adoption of the Valuation Methodology has resulted in a material reduction in the valuation of investments that are not readily realisable - in particular the Long Lock Funds and the Liquidation Share Classes. The Board believes that investor perception that such illiquid assets are often over-valued is a material driver of discounts to net asset value prevalent in listed closed-ended sector funds which contain investments which are not readily realisable.

3. Purchases of Ordinary Shares by the Company

If the Placing becomes unconditional, the Directors intend to convene a general meeting of Shareholders to seek authority to make market acquisitions of up to 15 per cent. of the Ordinary Shares then in issue (subject to the Company having available resources to do so) in order to address any imbalance between the supply of and demand for Ordinary Shares which may otherwise cause the share price to trade at a discount to the Net Asset Value per Ordinary Share.

Purchases of Ordinary Shares will be made within guidelines established from time to time by the Directors. In the first instance, during the period prior to the Company becoming fully invested, the Board would expect to utilise the share buyback authority if the Ordinary Shares consistently trade at a discount to NAV in excess of 5 per cent. Ordinary Shares repurchased by the Company will be cancelled. Ordinary Shareholders should note that the exercise of the Company's powers to repurchase Ordinary Shares is entirely discretionary and Ordinary Shareholders should place no expectation or reliance on the Directors exercising such discretion on one or more occasions. The utilisation of discount control measures by the Company is subject to all applicable laws, rules and regulations (including, without limitation, as to the satisfaction of the solvency test prescribed by the 2008 Law) prevailing at the time of utilisation, the Articles of the Company in force from time to time and the policies of the Board from time to time.

Notwithstanding the above discount management provisions, Ordinary Shareholders should not expect that they will necessarily be able to realise, within a period which they would otherwise regard as reasonable, all or any of their investment in the Company, nor can they be certain that they will be able to realise all or any of their investment on a basis that necessarily reflects the value of the Ordinary Shares Pool.

Listing

The Company's Ordinary Shares will be admitted to trading under Chapter 14 of the Listing Rules (Standard listing (shares)) rather than under Chapter 15 of the current Listing Rules (closed-ended investment funds: premium listing).

The Board currently believes that the Main Market is the most appropriate exchange on which the Ordinary Shares should be traded. Accordingly the Directors will apply for the Placing Shares to be admitted to the Official List of the UK Listing Authority and to trading on the Main Market. If, following the Placing, the Company fails to meet eligibility requirements for the Official List as a result of having insufficient shares in public hands, the Company intends to cancel the listing of the Ordinary Shares (including the Placing Shares) on the Official List and the Main Market and seek admission to trading of those shares on the SFM.

The SFM is an EU-regulated market operated by the LSE. The continuing obligations of the SFM are

broadly similar to those of Chapter 14 of the Official List, the key obligations being as follows:

   --    compliance with the LSE's corporate actions timetable; and 

-- the Financial Services Authority's Disclosure and Transparency Rules will apply to the Company.

As the costs of maintaining a listing are significant and Run-Off Shareholders are likely to derive little benefit from it due to the expected illiquidity of trading in the Run-Off Shares (which would be likely to become even more pronounced as the size of the class reduced) it is not proposed to list the Run-Off Shares.

Expenses of the Placing

All expenses of the Placing will be allocated to the Ordinary Share Pool. On the basis that the gross proceeds of the Placing amount to GBP100.0m, the total expenses of the Placing are estimated to amount to GBP2.2m (of which GBP2.0m is attributable to the Placing Shares and GBP0.2m is attributable to the existing Ordinary Shares).

The Manager and the Sub Manager

The Directors are responsible for the determination of the Company's investment policy and have overall responsibility for the Company's activities. The Company has, however, entered into an amended and restructured Management Agreement with the Manager, Saltus (Channel Islands) Limited, under which the Manager has been appointed with overall responsibility for the management of the Company's portfolio and the provision of various other management services to the Company, subject to the overriding supervision of the Directors.

The Manager is regulated by the Guernsey Financial Services Commission. The Manager is a Guernsey registered company, incorporated on 16 September 2005 with registration number 43685.

The Manager has entered into an amended and restructured sub-management agreement with the Sub Manager, Saltus Partners LLP, for the Sub Manager to undertake certain of its investment management duties, including making day-to-day investment decisions, based on advice provided by the Investment Adviser. Saltus Partners is a London-based FSA-regulated investment manager which provides multi-manager investment management and financial advisory services to high net worth individuals, families' charities, trusts and institutions. Saltus Partners is also Sub Manager to AcenciA Debt Strategies Limited, another London listed investment company. Saltus Partners specialises in investing in alternative assets, including hedge funds, private equity and commercial property on behalf of its clients. Saltus Partners was founded in early 2004 by Jon Macintosh and Simon Armstrong and comprises a team of twelve individuals.

Saltus Partners LLP is regulated by the Financial Services Authority. It is an English-registered limited liability partnership incorporated on 16 June 2004 with registration number OC308328.

The Manager and Sub Manager have appointed Dakota Capital International Pty Ltd to act as the Investment Adviser in relation to the investment of the Company's portfolio, pursuant to the Investment Advisory Agreement.

Total funds under management for the Manager and the Sub Manager in relation to the management of closed ended and open ended investment companies exceeded GBP270 million as at 31 August 2012.

Investment Adviser

Dakota is an Australian based funds management group which buys secondary hedge fund interests. Dakota's client base consists primarily of Australian ultra-high net worth individuals and family offices. Dakota is an authorised representative under the Australian financial services licence of a related entity, Axle Capital Pty Limited (with licence number AFSL 365948). Australian financial services licences are regulated by the Australian Securities and Investments Commission. Axle Capital Pty Limited, Axle Holdco Pty Ltd (a related entity) and Dakota were founded in 2010 and collectively manage approximately $430 million in hedge funds as at 30 June 2012. Axle Capital and Axle Holdco together manage fund of hedge funds in wind-down. Dakota has had prior experience of managing seven funds.

Dakota has been appointed as Investment Adviser to the Company with responsibility for providing investment advice in relation to the composition of the Company's investment portfolio.

Management Fees

Under the terms of the Management Agreement, the Manager is entitled to receive a management fee from the Company equal to 0.125 per calendar month (equivalent to 1.5 per cent. per annum) of the Monthly Average Market Capitalisation and 0.0833 per cent. per calendar month (equivalent to 1 per cent. per annum) of the Total Run-off Asset Value.

In addition to the management fee, the Manager shall be entitled in certain circumstances to a performance fee payable by the Company, in relation to the Ordinary Shares Pool. For the purposes of determining whether a performance fee is payable and calculating the amount of the performance fee, the only distributions taken into account are distributions attributable to the Ordinary Shares Pool. After the point when each Ordinary Shareholder has received an amount of cash distributions equal to the Placing Price per Ordinary Share (referred to as the "Contributed Capital"), and such additional distributions that they have realised an annualised return (on a compound basis) of 8 per cent. on the Contributed Capital (the "Preferred Return"), the Manager will become entitled to a performance fee. In the first instance the performance fee will be equal to 100 per cent of all distributions made in excess of the Contributed Capital and the Preferred Return until the Manager has received an amount equal to 15 per cent. of all distributions made by the Company, other than distributions in respect of the Contributed Capital. Thereafter, all distributions shall be paid 85 per cent. to the Ordinary Shareholders and the remaining 15 per cent. to the Manager. No performance fee is payable on the Run-off Shares Pool.

After receiving its own fees from the Company, the Manager is responsible for meeting all the investment advisory fees of the Investment Adviser (which comprise a fixed proportion of both the management fee and the performance fee) under the terms of the Investment Advisory Agreement and all of the fees of the Sub Manager which, under the terms of the Sub Management Agreement, shall be an amount agreed between the Investment Manager and the Sub Manager.

Publication of the Prospectus and Circular

A copy of the Prospectus will be submitted to the National Storage Mechanism and will be available for inspection at www.Hemscott.com/nsm.do. A copy of the Prospectus will also be available on the Company's website, www.alternative-liquidity.com

Defined terms in this announcement shall, unless otherwise stated, have the same meaning as those attributed to them in the Prospectus.

Important Information

This Announcement has been issued by and is the sole responsibility of the Company.

No representation or warranty express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Canaccord Genuity Europe Limited ("Canaccord Genuity") or by any of its respective affiliates or agents as to or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

This announcement is an advertisement and is not a prospectus. Accordingly, investors should not subscribe for securities except on the basis of information in the Prospectus itself.

Neither this document nor anything contained herein shall form the basis of, or be relied upon in connection with, any offer or commitment whatsoever in any jurisdiction. Any offer to acquire securities pursuant to the Issue will be made, and any investor should make his investment, solely on the basis of information that is contained in the Prospectus.

This announcement and the information contained herein is not for publication, release or distribution, directly or indirectly, in or into the United States, Australia, South Africa, Canada or Japan or any jurisdiction in which the same would be unlawful. This announcement does not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire shares in the capital of the Company in the United States, Australia, Canada or Japan or any jurisdiction in which such an offer or solicitation is unlawful.

Any offering will only be made in any jurisdiction in compliance with local laws.

None of the Shares in the Company referred to in this Announcement (the "Shares") have been, or will be, registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any State or other jurisdiction of the United States, and accordingly may not be offered, sold or transferred within the United States except pursuant to an exemption from, or in a transaction not subject to, registration under the Securities Act. No offering of the Shares is being made in the United States or to U.S. persons as defined in and in accordance with Regulation S under the Securities Act ("U.S. Persons"). The Company has not been and will not be registered under the U.S. Investment Company Act of 1940, as amended (the "Investment Company Act") and investors will not be entitled to the benefits of that Act.

Canaccord Genuity Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as sponsor to the Company and is acting for no-one else in connection with the Issue and the contents of this announcement, and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Canaccord Genuity Europe Limited nor for providing advice in connection with the Issue and the contents of this announcement or any other matter referred to herein. Canaccord Genuity Limited is not responsible for the contents of this announcement. This does not exclude or limit any responsibilities which Canaccord Genuity Europe Limited may have under the Financial Services and Markets Act 2000 or the regulatory regime established thereunder.

The distribution of this Announcement and the Placing in certain jurisdictions may be restricted by law. No action has been taken by the Company or Canaccord Genuity that would permit an offering of the Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and Canaccord Genuity to inform themselves about, and to observe, such restrictions.

This Announcement is for information purposes only and does not constitute an invitation to subscribe for or otherwise acquire or dispose of securities in the Company in any jurisdiction. The information contained in this Announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this Announcement or its accuracy or completeness, This announcement does not constitute or form part of any offer to issue or sell, or any solicitation of any offer to subscribe or purchase, any investments nor shall it (or the fact of its distribution) form the basis of, or be relied on in connection with, any contract therefor.

Certain statements in this Announcement are forward-looking statements which are based on the Company's expectations, intentions and projections regarding its future performance, anticipated events or trends and other matters that are not historical facts. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Given these risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of such statements and, except as required by applicable law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The information contained in this Announcement is subject to change without notice and neither the Company nor Canaccord Genuity assume any responsibility or obligation to update publicly or review any of the forward-looking statements contained herein.

This information is provided by RNS

The company news service from the London Stock Exchange

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