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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Gart.Gwth | LSE:GGOR | London | Ordinary Share | GB00B07BP660 | ORD 0.025P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 471.50 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMGGOR Reconstruction of the Company and suspension of redemption facility Further to the announcement on 13 September 2010 in relation to the strategic review of the Company's management arrangements, the Board has received proposals from fourteen investment managers, including Gartmore Investment Limited ("Gartmore"), for the future management of the Company's assets. Following discussions with a majority of the Company's shareholders, the Board is pleased to announce that it has reached agreement in principle with Artemis Alpha Trust plc ("ATS") for a merger of the assets of the two companies to be effected through a scheme of reconstruction and winding up of the Company (the "Proposals"). Overview of the Proposals Under the Proposals, which are to be recommended by the respective Boards of both companies, the Company's shareholders will be offered a choice between:- * continuing their investment in a tax efficient manner in a strong performing UK domiciled investment trust managed by Artemis Investment Management Limited ("Artemis"), by receiving such number of ordinary shares in ATS as shall equal 98.5% of the Formula Asset Value ("FAV") of the shares in the Company which are rolled over; and * an immediate cash exit at 95% of FAV on the approval of the Proposals, for up to 30% of the Company's issued share capital as at the effective date of the Proposals (the "Cash Option"). Elections by shareholders to receive in excess of 30% of their holdings for cash will be accepted to the extent that other shareholders have not made any elections for cash or have made elections for cash for less than 30% of their respective holdings. The record date for Shareholders to be entitled to elect for the Cash Option is the close of business on 24 September 2010. The Cash Option will be funded through the voluntary early exercise of all the ATS manager warrants held by the Artemis's fund managers in the share capital of ATS (the "ATS Manager Warrants"), raising approximately GBP8 million, with the balance funded from existing cash resources, augmented as required by a short term debt facility. Following the exercise of the ATS Manager Warrants Artemis will own circa 23.9% of ATSs share capital immediately prior to the implementation of the Proposals. Under the Proposals, new shares in ATS issued to shareholders of the Company electing to rollover their investment into ATS will rank pari passu with existing ATS shares, save for the interim dividend in respect of the six months to 31 October 2010. Bonus issue of subscription sharesby ATS Shareholders electing to rollover into ATS, together with existing ATS shareholders, will receive one subscription share in ATS for every seven ATS shares held or issued pursuant to the Proposals. It is currently envisaged that each ATS subscription share will confer the right (but not the obligation) to subscribe for one ATS ordinary share upon exercise of such ATS subscription share and on payment of a conversion price which is expected to be at a 10% premium to the NAV of an ATS ordinary share immediately following implementation of the Proposals. It is currently intended that the ATS subscription shares will have a seven year life and will be traded on the London Stock Exchange. Key benefits of the Proposals for all Shareholders * the Proposals offer choice; * the Proposals prevent the need for a realisation of the Company's mainly small cap investment portfolio which will be transferred to ATS; * a tax efficient rollover into ATS which through its investment policy provides its highly rated management team with flexibility; and * a cash exit for up to 30% and potentially more of their shares, at a 5% discount to FAV and in a short timeframe. For shareholders who elect to rollover into ATS: * a high conviction UK growth investment company with a strong track record of delivering shareholder value and a consistently strong share price rating relative to its peers; * strong alignment between shareholders' and management's interests through the substantial holdings in ATS of the Artemis fund managers; and * added value through the bonus issue of subscription shares on a one for seven basis. Costs of the proposals The Company will pay its own costs for implementing the Proposals (including the fee payable on the early termination of the management agreement with Gartmore). As it is intended that the entire portfolio of the Company will be transferred to ATS under the Proposals, all shareholders in the Company, including those electing for the Cash Option (for part or all of their holding), will not incur any realisation costs on the disposal of the Company's investments upon successful implementation of the Proposals. ATS will meet its own costs associated with the Proposals. Artemis Alpha Trust plc ATS is a leading investment company in the UK growth sector and Artemis's flagship closed end fund. As at 24 September 2010, ATS had net assets of circa GBP90.1 million. The investment objective of ATS is to achieve above average rates of total return over the longer term and to achieve a growing dividend stream through investment in mainly UK and selected international equities, with the potential for investment in limited liability hedge funds, cash and bonds, unquoted investments, derivative instruments and other investments and securities, as appropriate. As at 31 August 2010, 74% of its investment portfolio was invested in small cap stocks. ATS's core strategy is to focus on small cap companies but its wide investment remit allows it the flexibility to hold a wide range of securities where its fund managers see value. ATS has a strong track record evidenced by its net asset value which has outperformed the FTSE SmallCap Index (ex-ICs) as well as the wider UK market as measured by the FTSE All Share Index over one, three, and five year periods to 24 September 2010 on a total return basis. Since Artemis was appointed manager of ATS in June 2003, it has generated total returns for shareholders on a net asset value basis of 307.7% compared to 89.1% for the FTSE All Share Index. The Board of ATS believes that it is in the best interests of shareholders in ATS to maintain a stable discount through the management of the supply and demand for ATS shares. Whilst no specific targets are set, the Board of ATS has empowered Artemis to exercise ATS's authority to buy back its own shares from time to time to address any imbalances between the supply and demand of the ATS shares and to achieve a stable level of discount. Over the 12 month period to 24 September 2010, ATS shares have traded at an average discount of 5.9% (as compared with 5.1% over the same period for the Company) (source: Morningstar). Artemis fund managers' currently own circa GBP5.6 million by value of ATS ordinary shares (based on the closing price of the ordinary shares of ATS on 24 September 2010). It is expected that this will increase to circa GBP22 million (based on the closing price of the ordinary shares of ATS on 24 September 2010) following the exercise of the ATS Manager Warrants outlined above (representing approximately 23.9% of ATS's share capital immediately prior to implementation of the Proposals). In view of this it is envisaged that ATS will introduce a performance related fee element to its management arrangements which continues to align the interests of Artemis with those of ATS shareholders. The ATS website is http://www.artemisonline.co.uk/investor/products/artemis-alpha-trust-plc Suspension of the Redemption Facility The Company's Articles of Association incorporate provisions enabling shareholders to redeem their shares on a quarterly basis, subject to the Board not exercising their discretion to suspend or limit the extent of the redemption facility. In view of the impending implementation of the Proposals, which will enable shareholders to elect for a cash exit in respect of part or all of their shares, subject to the 30% limit described above, the Board has decided to exercise its discretion not to offer shareholders the opportunity to redeem their shares in the Company until further notice. Accordingly, the October 2010 redemption facility will not be available to shareholders. Expected Timetable The Company expects to post a circular to shareholders providing full details of the Proposals during November 2010 so as to enable shareholders' approval to be obtained in December 2010, with a view to the Proposals being completed shortly thereafter, conditional on shareholder approval and requisite regulatory approvals and tax clearances. The Board also intends to declare an interim dividend prior to the implementation of the Proposals. Contact details Ian Dighe Tel: 07785 703 261 Gartmore Growth Opportunities plc Will Rogers Tel: 020 7397 1920 Cenkos Securities plc Simon Miller Tel: 07768 794 182 Artemis Alpha Trust plc Gordon Neilly Tel: 020 7050 6778 Canaccord Genuity Limited END
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