Capital Restructure and Name Change

 

TIDMMDS 
 
RNS Number : 0532P 
Midas Capital PLC 
08 July 2010 
 

News release 
 
8 July 2010 
 
Midas Capital plc 
 
Midas proposes capital restructure and company name change to MAM Funds plc 
 
Midas Capital plc, the AIM quoted fund management company (the "Company"), is 
seeking shareholder approval at a General Meeting to be held on 28 July 2010, to 
create additional distributable reserves through the cancellation of its share 
premium account and capital redemption reserve and all of the deferred shares in 
issue (the "Reduction of Capital").  Shareholder approval is also being sought 
to the making of some minor changes to the Articles of Association of the 
Company (the "Articles") and to change the name of the Company to MAM Funds plc. 
 These proposals are contained in a circular being posted today to shareholders, 
copies of which are available on the Company's website (www.midascapitalplc.com) 
and from its registered office. 
 
The Company has recently divested its wealth management business releasing cash 
of approximately GBP6.4m (net of expenses and allowable deductions) and is bound 
by its Articles and its bank facilities to apply the net proceeds of the sale 
(the "Sale Proceeds") to redeeming a portion of its Preference Shares in issue, 
to the extent that it has the requisite distributable reserves to do so. 
Currently, the Company has insufficient distributable reserves to enable it to 
apply the Sale Proceeds in full in this way.  It is therefore proposed that 
further distributable reserves are created by the Reduction of Capital.  The new 
distributable reserves so created would be available for the directors of the 
Company to use to redeem preference shares of GBP1 each in the capital of the 
Company. 
 
In addition to the passing of a special resolution to approve the Reduction of 
Capital, sanction of the Court is also required.  Before giving such approval, 
the Court will require that creditors at the time of the Reduction of Capital 
are protected adequately.  The Company is therefore likely to be required to put 
into escrow an amount of cash in respect of such creditors, at the date of Court 
sanction, who may not consent to the Reduction of Capital (estimated at GBP1m). 
 
The effect of the Reduction of Capital will be to add a total of GBP27,016,487 
to the distributable reserves of the Company. Subject to shareholder approval 
and the approval of the Court being forthcoming, after setting aside funds of 
approximately GBP1m required to protect creditors, the remaining GBP5.4m of Sale 
Proceeds will then be applied to redeem Preference Shares, leaving approximately 
GBP7.4m still outstanding. 
 
The Board is proposing that minor amendments are made to the Articles in order 
to allow the Company and the holder of the majority in nominal value of the of 
Preference Shares to agree on the number of Preference Shares that are required 
to be redeemed upon the occurrence of relevant trigger events, and the timescale 
in which this will be achieved.   The Board is also seeking shareholder approval 
to rename the Company MAM Funds plc, as the current name is seen to be too 
closely linked to one subsidiary of the Midas group. 
 
Colin Rutherford, executive chairman, Midas Capital plc, says: 
 
"The proposed resolutions, which the Directors are unanimously recommending, 
will create distributable reserves, allowing the Company to retire the residual 
Preference Shares. 
 
"The change of name will improve our ability to market products and services 
offered by the Company and address some confusion in the market.  We are one of 
the leading multi asset investment managers in the UK, with top decile 
performance by our Miton Special Situations and Strategic funds over 3 years and 
the return to form of our principal Midas funds' in 2009." 
 
For further information please contact: 
 
Colin Rutherford, executive chairman, Midas Capital 
07768 053 054 
James Steel, Director, Arbuthnot Securities 
         020 7012 2000 
Roland Cross/ Zoe Butt / Fiona Kehily, Broadgate Mainland                020 
7726 6111 
 
Notes 
This announcement does not contain all the information which will be contained 
in the Circular and does not contain sufficient information for Shareholders to 
make an informed election under the Proposals. 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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