Sequoia Economic Infra Inc Fd Ld Initial Issue and Share Issuance Programme (1815B)

TIDMSEQI

RNS Number : 1815B

Sequoia Economic Infra Inc Fd Ld

19 September 2018

THIS ANNOUNCEMENT IS NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES (INCLUDING TO U.S. PERSONS, AS SUCH TERM IS DEFINED UNDER REGULATION S OF THE U.S. SECURITIES ACT OF 1933, AS AMED, THE "SECURITIES ACT"), CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

19 September 2018

Sequoia Economic Infrastructure Income Fund Limited (the "Company" or "SEQI")

Initial Issue targeting GBP200 million and Share Issuance Programme

Further to the announcement on 20 August 2018 and in light of what the Board of Directors of the Company (the "Board") consider to be a growing set of attractive investment opportunities in the economic infrastructure debt market, the Board has resolved to proceed with a partially pre-emptive issue of Ordinary Shares seeking to raise GBP200 million of gross proceeds before expenses (the "Gross Issue Proceeds"), equivalent to up to 188,679,245 new ordinary shares of no par value in the capital (the "New Ordinary Shares") (the "Initial Issue"). The Directors have determined that the Ordinary Shares will be issued at a price of 106.0 pence per new Ordinary Share (the "Issue Price").

The Board recognises the importance of pre-emption rights to Ordinary Shareholders. Accordingly, 149,420,048 New Ordinary Shares are being initially offered to Qualifying Shareholders by way of the Open Offer pursuant to which they will be entitled to apply for 2 New Ordinary Shares for every 11 existing Ordinary Shares held at 6.00 p.m. on 14 September 2018 (the "Record Date"). The balance of the New Ordinary Shares, together with any New Ordinary Shares not taken up by Qualifying Shareholders under the Open Offer, will be made available under the Placing and/or Offer for Subscription of New Ordinary Shares.

The Company intends to use the proceeds raised from the Initial Issue (less expenses) (the "Net Issue Proceeds") to repay the drawn commitments under its multi-currency Revolving Credit Facility ("RCF"). As at the latest practicable date, the Company had drawn an amount of approximately GBP116.2 million from its RCF which includes drawdowns made under the accordion tranche. Any Net Issue Proceeds raised in excess of the amount drawn under its RCF are expected to be deployed into the Company's near term pipeline of in excess of GBP300 million of investment opportunities, in accordance with the Company's Investment Policy.

The Company has also proposed to implement a share issuance programme, which would allow it the flexibility to issue up to a maximum of 250,000,000 Ordinary Shares (the "Share Issuance Programme") in the future. Any future issues under the Share Issuance Programme will be subject to the availability of a future pipeline of investment opportunities, which meet the Company's Investment Policy, in particular its target return and risk criteria, and the Company's level of deployment.

The Company expects to publish a prospectus (the "Prospectus") in connection with the Initial Issue and the Share Issuance Programme shortly. Unless otherwise defined, the terms used in this Announcement shall have the same meaning as set out in the Prospectus.

Stifel Nicolaus Europe Limited is acting as sole sponsor, financial adviser and bookrunner to the Company.

The Share Issuance Programme and the Initial Issue

The Initial Issue is being implemented by way of the Open Offer, Placing and Offer for Subscription. The target size of the Initial Issue is approximately GBP200 million before expenses. The target number of New Ordinary Shares to be issued pursuant to the Initial Issue is 188,679,245 at the Issue Price of 106.0 pence per New Ordinary Share. The Issue Price of 106.0 pence represents a premium of approximately 4.8 per cent. to the unaudited NAV per Ordinary Share as at 31 August 2018 of 101.17 pence and a discount of approximately 4.5 per cent. to the closing price of 111.0 pence per existing ordinary share on 18 September 2018.

The New Ordinary Shares issued pursuant to the Initial Issue will rank pari passu in all respects with the existing Ordinary Shares. For the avoidance of doubt, the new Ordinary Shares will be entitled to the interim quarterly dividend for the period ended 30 September 2018, expected to be declared in October 2018, after the closing of the Initial Issue.

The Directors recognise the importance of pre-emption rights to Ordinary Shareholders. Accordingly, a substantial proportion of the New Ordinary Shares are being initially offered to Qualifying Shareholders by way of the Open Offer pursuant to which they will be entitled to apply for 2 New Ordinary Shares for every 11 existing Ordinary Shares held on the Record Date (being 149,420,048 New Ordinary Shares).

The balance of the New Ordinary Shares (being 39,259,197 New Ordinary Shares), together with any New Ordinary Shares not taken up by Qualifying Shareholders under the Open Offer (including under the Excess Application Facility), may be made available, at the discretion of the Directors, under the Placing and/or Offer for Subscription of New Ordinary Shares.

The Directors may increase the size of the Initial Issue by reallocating up to 50,000,000 Ordinary Shares available under the Share Issuance Programme to the Initial Issue if they, in consultation with Stifel and the Investment Adviser, believe there are sufficient assets available and suitable for investment. The maximum number of New Ordinary Shares available pursuant to the Initial Issue is therefore 238,679,245 (including any reallocation of Ordinary Shares under the Share Issuance Programme to the Initial Issue).

Under the Share Issuance Programme, the Company proposes to have the ability to issue up to 250,000,000 Ordinary Shares in the future (less up to 50,000,000 Ordinary Shares if such Ordinary Shares have been allocated as New Ordinary Shares under the Initial Issue). Any future issues under the Share Issuance Programme are dependent on the Company's pipeline of investment opportunities and accordingly there is no certainty that there will be any future issues of shares under the Share Issuance Programme before its expiry.

The Directors intend that any material issue under the Share Issuance Programme shall include a material pre-emptive element consistent with the approach in respect of the Initial Issue.

Pipeline and financing of opportunities

The Investment Adviser is currently engaged in various stages of negotiations on potential acquisitions with a total value of in excess of GBP300 million. In addition, the Investment Adviser expects to see a steady stream of further investment opportunities in the near term. The acquisition of these potential investments is subject, among other things, to the approval of the Directors, and the Investment Adviser completing satisfactory due diligence in relation to such potential investments, and any such acquisitions will be subject to agreement having been reached between the Investment Adviser and the relevant counterparty as to the terms of such acquisitions.

Of the Investment Adviser's pipeline of opportunities totaling in excess of GBP300 million, approximately 78 per cent. of the opportunities are senior secured debt instruments and 76 per cent. are floating rate debt instruments. Approximately 61 per cent. of the near term pipeline consists of opportunities in the US and 22 per cent. of the opportunities are in the UK. The Company will invest any Net Issue Proceeds, after repayment of the RCF, in accordance with the Company's Investment Policy.

If the Net Issue Proceeds are less than the current amount drawn under the RCF, or following deployment of all Net Issue Proceeds, the Company expects to re-draw funds under the RCF to invest in these pipeline opportunities or new opportunities that become available. Approximately GBP107.2 million of the Company's assets will reach their expected maturity in the next 12 months, with approximately a total of GBP176.8 million of redemptions scheduled over the remaining life of the RCF to December 2020. In practice more redemptions are likely to occur allowing for prepayments over the period. This implies that, should market conditions change, and the Company be unwilling to pay back future drawings on the RCF by raising more equity capital, the Company expects to be able to prepay the debt out of cashflow generated by the portfolio.

Further details of the Company's portfolio and pipeline can be found in the Company's Prospectus once published.

Benefits of the Initial Issue

The Board believes that proceeding with the Issue will have the following benefits:

-- Providing the Company with the funds to repay the RCF which will allow the Company to re-draw funds under the RCF as and when investment opportunities arise without incurring cash drag;

-- Allowing the Company, following repayment of the RCF, to invest further capital in the Company's identified available pipeline opportunities which should enable the Group to further diversify its Existing Portfolio;

-- Creating the potential to enhance the NAV per Ordinary Share of the existing Ordinary Shares through the issuance of New Ordinary Shares at a premium to NAV per Ordinary Share, after the related costs have been deducted;

-- Spreading the Company's fixed running costs across a wider base of shareholders, and benefiting from the reducing scale of charges for the Investment Adviser, thereby reducing the total expense ratio;

-- Increasing the size of the Company which should help make the Company more attractive to a wider base of investors and improving market liquidity in the Ordinary Shares; and

-- Increasing the size of the Company which should help make the Company more attractive to a wider base of borrowers and improve the Company's pipeline of opportunities.

Benefits of the Share Issuance Programme

Under the Share Issuance Programme, the Company proposes to have the ability to issue up to 250,000,000 Ordinary Shares (less up to 50,000,000 Ordinary Shares if such Ordinary Shares have been allocated as New Ordinary Shares under the Initial Issue) in tranches.

Under the Share Issuance Programme the Company will have the flexibility to issue further shares through any of a placing, open offer and offer for subscription, or any combination of them. The Directors intend that any material issue under the Share Issuance Programme would include a material pre-emptive element consistent with their approach in respect of the Initial Issue.

The Directors believe that instituting the Share Issuance Programme will:

-- Enable the Company to raise additional capital quickly through an equity issuance, in order to i) repay the RCF when it becomes fully or substantially drawn and/or ii) invest in opportunities identified in the future;

-- Create the potential to enhance the NAV per Ordinary Share of existing Ordinary Shares through new share issuance at a premium to NAV per Ordinary Share, after the related costs have been deducted;

-- Grow the Company, thereby spreading operating costs over a larger capital base, and benefiting from the reducing scale of charges for the Investment Adviser, which should reduce the total expense ratio; and

-- Partially satisfy market demand from time to time for Ordinary Shares and improve liquidity in the market for the Ordinary Shares.

Extraordinary General Meeting ("EGM")

The proposals in the Prospectus, are conditional on, amongst other things, the approval of the Resolutions by the Shareholders at the EGM. A separate circular (the "Circular") is expected to be published shortly which includes a notice of the EGM to be held at 10.00 a.m. on 5 October 2018 at Sarnia House, Le Truchot, St Peter Port, Guernsey, GY1 1GR. At the EGM the Company will seek the approvals necessary from Shareholders for the Initial Issue and the Share Issuance Programme to proceed.

An EGM of the Company is being convened at which Shareholders will be asked to approve:

-- the disapplication of pre-emption rights in respect of up to 188,679,245 Ordinary Shares for the purposes of the Initial Issue ("Resolution 1"); and

-- the disapplication of pre-emption rights in respect of up to 250,000,000 Ordinary Shares for the purposes of the Share Issuance Programme ("Resolution 2");

The proposed Initial Issue is conditional upon, amongst other things, the Company obtaining Shareholders' approval of Resolution 1. The proposed Share Issuance Programme is conditional upon, amongst other things, the Company obtaining Shareholders' approval of both of the Resolutions.The Board believes that the Resolutions are in the best interests of the Company and its Shareholders as a whole and recommends that Shareholders vote in favour of the Resolutions at the EGM.

Expected Timetable

 
 Open Offer 
 Record Date for entitlements to                         6.00 p.m. on 14 September 
  participate in the Open Offer                                               2018 
 Ex-entitlement date for the Open                        8.00 a.m. on 19 September 
  Offer                                                                       2018 
 Open Offer opens                                        8.00 a.m. on 19 September 
                                                                              2018 
 Basic Entitlements and Excess CREST                  As soon as practicable after 
  Open Offer Entitlements credited                       8.00 a.m. on 20 September 
  to CREST stock accounts (Qualifying                                         2018 
  Shareholders only) 
 Recommended latest time for requesting                4.30 p.m. on 2 October 2018 
  withdrawal of Basic Entitlements 
  and Excess CREST Open Offer Entitlements 
  from CREST (i.e, if your Basic Entitlements 
  and Excess Open Offer Entitlements 
  are in CREST and you wish to convert 
  them to certificated form) 
 Latest time and date for depositing                   3.00 p.m. on 3 October 2018 
  Basic Entitlements and Excess CREST 
  Open Offer Entitlements into CREST 
 Latest time and date for splitting                    3.00 p.m. on 4 October 2018 
  Open Offer Application Forms (to 
  satisfy bona fide market claims 
  only) 
 Latest time and date for receipt                     11.00 a.m. on 8 October 2018 
  of completed Open Offer Application 
  Forms and payment in full under 
  the Open Offer or settlement of 
  relevant CREST instructions (as 
  appropriate) 
 Placing and Offer for Subscription 
 Placing and Offer for Subscription                      8.00 a.m. on 19 September 
  open                                                                        2018 
 Latest time and date for receipt                      3.00 p.m. on 8 October 2018 
  of completed Offer for Subscription 
  Application Forms and payment in 
  full under the Offer for Subscription 
 Latest time and date for receipt                     11.00 a.m. on 9 October 2018 
  of placing commitments under the 
  Placing 
 The Share Issuance Programme 
 Share Issuance Programme opens                                  19 September 2018 
 Publication of Share Issuance Programme        On announcement of each subsequent 
  Price in respect of each issuance                    issue pursuant to the Share 
  of Ordinary Shares                                            Issuance Programme 
 Admission and crediting of CREST                   8.00 a.m. on each day Ordinary 
  accounts in respect of each issuance                           Shares are issued 
  of Ordinary Shares 
 Last date for Ordinary Shares to                                18 September 2019 
  be issued pursuant to the Share 
  Issuance Programme 
 Other key dates 
 Results of the Initial Issue announced                            10 October 2018 
 Initial Admission of the New Ordinary                8.00 a.m. on 12 October 2018 
  Shares to the Official List and 
  commencement of dealings on the 
  London Stock Exchange 
 CREST accounts credited in respect                   On or around 12 October 2018 
  of New Ordinary Shares issued pursuant 
  to the Initial Issue to be held 
  in uncertificated form 
 Dispatch of definitive share certificates            On or around 19 October 2018 
  in respect of New Ordinary Shares 
  (where applicable) issued pursuant 
  to the Initial Issue 
 

EGM Expected Timetable

 
 Publication of the Prospectus                 19 September 2018 
  and Circular 
 Latest time and date for receipt   10.00 a.m. on 3 October 2018 
  of Forms of Proxy 
 EGM                                10.00 a.m. on 5 October 2018 
 

The dates and times specified above are subject to change. In particular, the Directors may (with the prior approval of Stifel) bring forward or postpone the closing time and date for the Initial Issue. In the event that a date or time is changed, the Company will notify persons who have applied for New Ordinary Shares pursuant to the Initial Issue or Ordinary Shares pursuant to the Share Issuance Programme of changes to the timetable either by post, by electronic mail or by the publication of a notice through a Regulatory Information Service. References to times are to London times unless otherwise stated.

Admission to trading

Application will be made to the UK Listing Authority and the London Stock Exchange for all of the New Ordinary Shares issued pursuant to the Initial Issue to be admitted to the premium segment of the Official List and to trading on the Main Market. It is expected that the results of the Initial Issue will be announced through a Regulatory Information Service on or around 10 October 2018 and it is expected that Initial Admission will become effective and that dealings for normal settlement in the Ordinary Shares will commence at 8.00 a.m. on or around 12 October 2018.

Further details

The ticker for the New Ordinary Shares is SEQI. The ISIN for the New Ordinary Shares is GG00BV54HY67 and the SEDOL is BV54HY6. The ISIN of the Basic Entitlements is GG00BG0NNZ67 and the SEDOL is BG0NNZ6. The ISIN for the Excess CREST Open Offer Entitlement is GG00BG0NNY50 and the SEDOL is BG0NNY5.

A copy of the Prospectus, when published, will be submitted to the National Storage Mechanism and will shortly thereafter be available for inspection at: www.morningstar.co.uk/uk/nsm as well as on the Company's website at http://www.seqifund.com/downloads. Full details of the Terms and Conditions of the Placing, Open Offer and the Offer for Subscription will be made available in the Company's Prospectus.

LEI: 2138006OW12FQHJ6PX91

For further information please contact:

 
 Sequoia Investment Management 
  Company 
  Steve Cook 
  Dolf Kohnhorst 
  Randall Sandstrom 
  Greg Taylor                      [phone] 
 Stifel Nicolaus Europe Limited 
  Neil Winward 
  Mark Bloomfield 
  Gaudi Le Roux                    [phone] 
 Praxis Fund Services Limited 
  (Company Secretary) 
  Matthew Falla                    [phone] 
 

About the Company

The Company seeks to provide investors with regular, sustained, long-term distributions and capital appreciation from a diversified portfolio of senior and subordinated economic infrastructure debt investments. The Company is advised by Sequoia Investment Management Company Limited

IMPORTANT NOTICES

This announcement contains Inside Information as defined under the Market Abuse Regulation (EU) No. 596/2014.

This announcement is an advertisement and does not constitute a prospectus relating to the Company and does not constitute, or form part of, any offer or invitation to sell or issue, or an invitation to purchase investments of any description, or any solicitation of any offer to subscribe for, any securities in the Company in any jurisdiction nor shall it, or any part of it, or the fact of its distribution, form the basis of, or be relied on in connection with or act as any inducements to enter into, any contract therefor. Copies of the Prospectus to be published by the Company will be available from http://www.seqifund.com.

Recipients of this announcement who are considering acquiring New Ordinary Shares are reminded that any such acquisition must be made only on the basis of the information contained in the Prospectus (or any supplementary prospectus) which may be different from the information contained in this announcement and must not be made in reliance on this announcement. The subscription for New Ordinary Shares is subject to specific legal or regulatory restrictions in certain jurisdictions. Persons distributing this announcement must satisfy themselves that it is lawful to do so. The Company assumes no responsibility in the event that there is a violation by any person of such restrictions.

This announcement does not constitute and may not constitute and may not be construed as a recommendation regarding the issue or the provision of investment advice by any party. No information set out in this announcement is intended to form the basis of any contract of sale, investment decision or any decision to purchase securities. Potential investors should consult a professional advisor as to the suitability of an investment in the securities for the person concerned.

The value of Ordinary Shares and the income from them is not guaranteed and can fall as well as rise due to stock market and currency movements. When you sell your investment you may get back less than you originally invested. Figures refer to past performance and past performance is not a reliable indicator of future results. Returns may increase or decrease as a result of currency fluctuations. Capital is at risk and investors need to understand the risks of investing. Please refer to the Prospectus for further information, in particular the "Risk Factors" section.

Neither this announcement nor the information contained herein is for release, publication or distribution, directly or indirectly, in or into the United States, the Republic of South Africa, Canada, Australia, New Zealand or Japan or any other jurisdiction where to do so might constitute a violation of the relevant laws or regulations of such jurisdiction. The securities referred to herein have not been and will not be registered under the relevant securities laws of any such excluded territory.

This announcement does not contain, constitute or form part of an offer for sale of, resale of, transfer of or delivery of or the solicitation of an offer to purchase directly or indirectly, securities in the United States or to, or for the account or benefit of a U.S. Person (as defined in Regulation S of the Securities Act). The securities referred to herein have not been, and will not, be registered under the Securities Act or any other applicable securities laws of, or with any securities regulatory authority of, any state or other jurisdiction of the United States, and may not be offered, sold, resold, transferred or delivered, directly or indirectly, in the United States or to, or for the account or benefit of, any U.S. Person absent registration or an applicable exemption from the registration requirements of the Securities Act. The Company has not been and will not be registered under the U.S. Investment Company Act of 1940, as amended, and neither International Fund Management (the "Investment Manager") nor Sequoia Investment Management Company (the "Investment Adviser") will be registered as an investment adviser under the U.S. Investment Advisers Act of 1940, as amended. Consequently, investors will not be entitled to the benefits and protections of the U.S. Investment Company Act of 1940, as amended or the U.S. Investment Advisers Act of 1940, as amended. The shares of the Company will be offered and sold only to non-U.S. Persons outside the United States in reliance on Regulation S under the Securities Act. There will be no offer of the Company's securities in the United States. The distribution of this document may also be restricted by law in other jurisdictions.

This announcement does not constitute or form part of, and should not be construed as, any offer or invitation to sell, or any solicitation of any offer to purchase or subscribe for any Ordinary Shares or any other securities nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, any contract or investment decision whatsoever, in any jurisdiction. This announcement does not constitute a recommendation regarding any securities.

The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

Subject to certain exceptions, the securities referred to herein may not be offered or sold in the United States, the Republic of South Africa, Canada, Australia, New Zealand or Japan or to, or for the account or benefit of, any national, resident or citizen of the United States, Canada, Japan, Australia, New Zealand or the Republic of South Africa. There will be no offer of the ordinary shares in the United States, Canada, the Republic of South Africa, Japan, Australia or New Zealand.

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 forward-looking statements, which may use words such as "aim", "anticipate", "believe", "could", "intend", "estimate", "expect", and words of similar meaning, include all matters that are not historical facts. These forward-looking statements involve risks, assumptions and uncertainties that could cause the actual results of operations, financial condition, liquidity and dividend policy and the development of the industries, which the Company's businesses operate to differ materially from the impression created by forward-looking statements. These statements are not guarantees of future performance and are subject to known and uncertain risks, uncertainties and other factors that could cause actual results to differ material from those express or implied by such forward-looking statements. Given those 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 the UK Financial Conduct Authority, the London Stock Exchange or 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.

Stifel Nicolaus Europe Limited ("Stifel"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for the Company and no one else in connection with the potential equity issue. Stifel will not regard any other person as its client in relation to the potential issue and will not be responsible to anyone other than the Company for providing the protections afforded to its clients, nor for providing advice in relation to the potential issue, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

Neither Stifel nor any of its directors, officers, employees, advisers, affiliates or agents accepts any responsibility or liability whatsoever for/or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company or its subsidiary, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith.

The Company is incorporated in Guernsey and has been registered as a registered closed-ended collective investment scheme under the Protection of Investors (Bailiwick of Guernsey) Law, 1987, as amended. It is suitable only for professional or experienced investors, or those who have taken appropriate professional advice.

Regulatory requirements which may be deemed necessary for the protection of retail or inexperienced investors, do not apply to listed funds. By investing in the Company you will be deemed to be acknowledging that you are a professional or experienced investor, or have taken appropriate professional advice, and accept the reduced requirements accordingly.

You are wholly responsible for ensuring that all aspects of the Company are acceptable to you. Investment in listed funds may involve special risks that could lead to a loss of all or a substantial portion of such investment. Unless you fully understand and accept the nature of the Company and the potential risks inherent in it you should not invest in the Company.

Further information in relation to the regulatory treatment of listed funds domiciled in Guernsey may be found on the website of the Guernsey Financial Services Commission at http://www.gfsc.gg/The-Commission/Pages/Home.aspx.

Information for Distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the Product Governance Requirements) may otherwise have with respect thereto, the Ordinary Shares have been subject to a product approval process, which has determined that such securities are: (i) compatible with an end target market of investors who meet the criteria of retail and professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment").

Notwithstanding the Target Market Assessment, distributors should note that: the price of the Ordinary Shares may decline and investors could lose all or part of their investment; the Ordinary Shares offer no guaranteed income and no capital protection; and an investment in Ordinary Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Transaction. Furthermore, it is noted that, notwithstanding the Target Market Assessment, Stifel will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the New Ordinary Shares pursuant to the Issue and/or any Ordinary Shares issued pursuant to the Share Issuance Programme.

Each distributor is responsible for undertaking its own Target Market Assessment in respect of the New Ordinary Shares and determining appropriate distribution channels.

Marketing disclosures pursuant to AIFMD (as defined below)

The Company is an externally managed alternative investment fund and has appointed International Fund Management Limited (the "AIFM"), as its alternative investment fund manager

Pursuant to Article 23 of AIFMD and the Alternative Investment Fund Managers Regulations 2013 (No. 1173/2013) and the Investment Funds Sourcebook of the FCA (the "UK AIFMD Rules"), the AIFM is required to make available to persons in the European Union who are invited to and who choose to participate in the Initial Issue, by making an oral or written offer to subscribe for New Ordinary Shares, including any individuals, funds or others on whose behalf a commitment to subscribe for New Ordinary Shares is given (the "Subscribers") certain information (the "Article 23 Disclosures"). For the purposes of the Initial Issue, the AIFM has made the Article 23 Disclosures available to Subscribers in the 'Investor - Shareholder Information' section of the Company's website at: http://www.seqifund.com.

PRIIPS (as defined below)

In accordance with the Regulation (EU) No 1286/2014 of the European Parliament and of the Council of 26 November 2014 on key information documents for packaged retail and insurance-based investment products ("PRIIPs") and its implementing and delegated acts (the "PRIIPs Regulation"), the AIFM has prepared a key information document (the "KID") in respect of the Ordinary Shares. The KID is made available by the AIFM to "retail investors" prior to them making an investment decision in respect of the Ordinary Shares at http://www.seqifund.com.

If you are distributing Ordinary Shares, it is your responsibility to ensure that the KID is provided to any clients that are "retail clients".

The Company is the only manufacturer of the Ordinary Shares for the purposes of the PRIIPs Regulation and neither Stifel nor the AIFM are manufacturers for these purposes. Neither Stifel nor the AIFM makes any representations, express or implied, or accepts any responsibility whatsoever for the contents of the KID prepared by the Company nor accepts any responsibility to update the contents of the KID in accordance with the PRIIPs Regulation, to undertake any review processes in relation thereto or to provide the KID to future distributors of Ordinary Shares. Both Stifel and the AIFM and their respective affiliates accordingly disclaim all and any liability whether arising in tort or contract or otherwise which it or they might have in respect of the key information documents prepared by the Company. Investors should note that the procedure for calculating the risks, costs and potential returns in the KID are prescribed by laws. The figures in the KID may not reflect actual returns for the Company and anticipated performance returns cannot be guaranteed.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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September 19, 2018 02:00 ET (06:00 GMT)