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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Octopus Vct 2 | LSE:OVC2 | London | Ordinary Share | GB00B3SD2L64 | ORD 1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 99.50 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
TIDMOVC2 Octopus Apollo VCT plc ("Apollo") Octopus VCT 2 plc ("OVCT2") (together the "Companies") 2 November 2015 Publication of a Prospectus (the "Prospectus") and Circulars (the "Circulars") in connection with recommended proposals to merge the Companies (to be completed pursuant to a scheme of reconstruction (the "Scheme" or "Merger") under section 110 Insolvency Act 1986) and an offer for subscription by Apollo. On 6 October 2015, the boards of Apollo and OVCT2 (the "Boards") announced that they had entered into discussions to merge the Companies into one company (the "Enlarged Company") and the Apollo Board announced that it also intended to raise further funds into Apollo pursuant to an offer for subscription (the "Offer") at the same time. The Boards are pleased to advise that discussions have now concluded and that the Companies have today issued the Circulars to set out the proposals for the Merger for consideration by their respective shareholders and a Prospectus relating to the Offer and Merger. Each of the Companies is managed by Octopus Investments Limited ("Octopus"). The Merger will be completed by OVCT2 being placed into members' voluntary liquidation pursuant to a scheme of reconstruction under Section 110 of the Insolvency Act 1986. Shareholders should note that the Merger will be outside the provisions of the City Code on Takeovers and Mergers. OVCT2 shareholders will receive one D ordinary share of 1p in the capital of Apollo ("Scheme Shares" or "D Ordinary Shares") for every ordinary share of 1p held in OVCT2 and the benefits will be shared by each set of shareholders, with the costs being split proportionately based on the net asset values of the Companies. The Merger requires the approval of resolutions by the Companies' shareholders. Apollo is seeking to raise GBP30 million under an offer for subscription for new ordinary shares ("Offer Shares"), with an over allotment facility of a further GBP10 million. The Offer is subject to the approval of the Apollo shareholders. Background Since launch in 2006, Octopus Apollo VCT has been managed, with on the aim of providing shareholders with a stable, regular income. OVCT2 was launched in January 2011 with a similar investment mandate and is managed by the same Octopus team as Apollo. Octopus was founded in March 2000. The latest unaudited NAV of Apollo, as at 21 August 2015, was 83.4p per ordinary share and the latest unaudited NAV of OVCT2, as at 30 June 2015, was 100.0p per ordinary share. The table below sets out the unaudited NAVs of the Companies and provides further detail on the venture capital investments in their portfolios. NAV per Number of Net Assets share venture (unaudited) (unaudited) capital Carrying value of the venture capital investments Company (GBP'm) (p) investments (GBP'm) NAV plus cumulative dividends paid* (p) Apollo 105 83.4 30 91.5 113.4 OVCT2 19 100.0 14 14.3 105.0 * the sum of (i) the unaudited NAV per share and (ii) all distributions per share paid since the first admission of the shares to the Official List Each of the Companies has an investment objective and policy of providing shareholders with a stable, regular income and capital return by investing their funds in a broad spread of unquoted UK companies which meet the relevant criteria for VCTs. VCTs are required to be traded on a European Union/European Economic Area regulated market. The Companies are listed on the premium segment of the Official List, which involves a significant level of listing costs, as well as related fees to ensure they comply with all relevant legislation. The Enlarged Company should be better placed to spread such running costs across a larger asset base and facilitate better liquidity management and, as a result, may be able to maximise investment opportunities and sustain a higher level of dividends to shareholders over its life. In September 2004, the Merger Regulations were introduced allowing VCTs to be acquired by, or merge with, each other without prejudicing the VCT tax reliefs obtained by their shareholders. A number of VCTs have taken advantage of these regulations to create larger VCTs. With the above in mind, the Boards entered into discussions with Octopus to consider a merger of the Companies to create a single, larger VCT. The aim of the Boards is to improve shareholder value while also creating liquidity for those current investors of OVCT2 who wish to exit after their 5 year qualifying holding period has been reached. The Boards also expect to achieve, among other things, strategic and scale benefits through the creation of an enlarged VCT. The Scheme The mechanism by which the Merger will be completed is as follows: -- OVCT2 will be placed into members' voluntary liquidation pursuant to a scheme of reconstruction under Section 110 IA 1986; -- all of the assets and liabilities of OVCT2 will be transferred to Apollo in consideration for the issue of Scheme Shares; and -- the assets and liabilities of OVCT2 transferred to Apollo will constitute a separate share fund. The effect of the Scheme will be that OVCT2 shareholders will receive one Scheme Share in Apollo for each OVCT2 share held. The Scheme is conditional upon its approval by the Apollo shareholders and by the OVCT2 shareholders, as well as the other conditions set out in the Prospectus and Circulars. As the Companies have a similar investment objective and policy, the same investment manager and other common advisers, the proposed Merger should be achievable without major additional cost or disruption to the Companies and their combined portfolio of investments. The aggregate anticipated cost of undertaking the Merger is approximately GBP290,000, including VAT, legal and professional fees, stamp duty and the costs of winding up OVCT2. The costs of the Merger will be split proportionately between the Companies by reference to their respective NAVs immediately prior to the Merger. Shareholders and investors should note that the merger by way of the Scheme will be outside the provisions of the City Code on Takeovers and Mergers. The portfolio of assets which will be transferred from OVCT2 to Apollo as part of the Scheme is all considered to be in keeping with Apollo's investment policy. The extent of the liabilities (if any) which will be transferred from OVCT2 to Apollo as part of the Scheme will be those which are incurred in the ordinary course of business and merger costs which remain unpaid at the time of transfer. Any such liabilities are expected to be nominal in comparison to the value of the assets. OVCT2 shareholders who do not vote in favour of the resolution to be proposed at OVCT2's first general meeting, as referred to in the timetable below, are entitled to dissent and have their shareholding purchased by the liquidators of OVCT2 (the "Liquidators") at a price agreed between the dissenting OVCT2 shareholders and the Liquidators (or by arbitration), which would be expected to be at a significant reduction to the net asset value of an OVCT2 share. If the conditions of the Scheme are not satisfied, the Companies will continue in their current form and the Boards will continue to review all options available to them regarding the future of the Companies. Clearance has been requested from HMRC that the Scheme meets the requirements of the Merger Regulations and, therefore, that the implementation of the Scheme should not affect the status of Apollo as a VCT. It is the intention of the Apollo Board to continue to comply with the requirements of Income Tax Act 2007 following the Merger so that Apollo continues to qualify as a VCT. Exit opportunity for OVCT2 Shareholders After 30 June 2016, once the VCT qualifying period for the current OVCT2 shareholders has been achieved, an opportunity will be provided for the holders of D Ordinary Shares to exit their investment in Apollo or, should they wish to continue their investment, to have their D Ordinary Shares converted into Ordinary Shares on a relative NAV basis in accordance with Apollo's articles of association. EXPECTED TIMETABLE, OFFER STATISTICS AND COSTS Expected Timetable for the Scheme Apollo Latest time and date for receipt of Forms of Proxy 11 am on 26 November for the General Meeting 2015 General Meeting 11 am on 30 November 2015 Scheme Calculation Date after 5.00 pm on 26 January 2016 Scheme Effective Date for the transfer of the assets 27 January 2016 and liabilities of OVCT2 to the Company and the issue of Scheme Shares Announcement of the results of the Scheme 27 January 2016 Admission of, and dealings in, Scheme Shares issued 28 January 2016 to commence CREST accounts credited (if applicable) 28 January 2016 Certificates for Scheme Shares despatched to OVCT2 Week commencing 15 Shareholders February 2016 OVCT2 Latest time for receipt of forms of proxy for the 3.00 pm on 14 January 2016 OVCT2 First General Meeting OVCT2 First General Meeting 3.00 pm on 18 January 2016
(MORE TO FOLLOW) Dow Jones Newswires
November 02, 2015 12:46 ET (17:46 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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