THIS ANNOUNCEMENT IS NOT FOR RELEASE,
PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO,
AUSTRALIA, CANADA, JAPAN, NEW
ZEALAND, THE REPUBLIC OF SOUTH
AFRICA AND THE UNITED
STATES OR ANY OTHER JURISDICTION WHERE TO DO SO MAY RESULT
IN THE CONTRAVENTION OF ANY REGISTRATION OR OTHER LEGAL REQUIREMENT
OF SUCH JURISDICTION
19 October 2018
BlackRock Emerging
Europe plc
(LEI:
549300OGTQA24Y3KMI14)
Publication of
Circular
Further to the announcement on 17 August
2018, BlackRock Emerging Europe plc (“BEEP” or the
“Company”) has today published a circular (the “Circular”)
in connection with the proposals for the reconstruction and winding
up of the Company and rollover into BlackRock Frontiers Investment
Trust plc (“BRFI”).
The Proposals
Under the Proposals, the Company is proposed to be wound up on
26 November 2018 by means of a
members' voluntary liquidation pursuant to a scheme of
reconstruction under section 110 of the Insolvency Act. Under
the Scheme, Eligible Shareholders (being Shareholders other than
Restricted Shareholders) will be able to elect for the following
Options:
·to realise all or some of their investment in the
Company for cash (the "Cash Option"); and/or
·to roll-over all or some of their investment into BRFI
and receive BRFI C Shares at 100
pence per BRFI Share (the "Rollover Option").
Eligible Shareholders can make different Elections in respect of
different parts of their holdings, and may therefore opt to
roll-over part of their holdings and elect for the Cash Option for
the remainder. Eligible Shareholders who do not make a valid
Election under the Scheme will be deemed to have elected for the
Rollover Option. Valid Elections under the Scheme must be received
by 1.00 p.m. on 8 November 2018. Eligible Shareholders are
encouraged to make an Election in respect of their Ordinary Shares
by completing and returning a Form of Election.
If the Proposals are implemented, such assets of the Company
that represent the interests of Shareholders who elect (or are
deemed to elect) for the Rollover Option (being the Rollover Pool)
will be transferred to BRFI. The consideration for such transfer
will be satisfied by the issue of BRFI C Shares to such
Shareholders at a deemed issuance price of 100 pence per BRFI C Share. It is envisaged that
UK resident Eligible Shareholders who elect to roll-over will be
given a tax-efficient rollover of their entitlements.
If the Proposals are implemented, such assets of the Company
that represent the interests of Shareholders who elect for the Cash
Option (being the Cash Pool) will be realised and the net proceeds
will be returned to such Shareholders.
Benefits of the Proposals
The Directors consider that the Proposals should have the
following benefits for Shareholders:
·Eligible Shareholders have the opportunity to roll over their
investment into BRFI, another closed-ended investment company under
the management of the same team at BlackRock Fund Managers Limited
led by Sam Vecht;
·Eligible Shareholders who might otherwise be subject to UK tax
on the realisation of their investment in the Company should be
able to roll over their investment into BRFI and continue to
receive investment returns without triggering an immediate
liability to UK tax. However, this does not constitute tax advice.
Please note that Shareholders should always obtain their own
independent tax advice pertaining to their own personal
circumstances;
·Eligible Shareholders who elect to roll over may not suffer the
full amount of the dealing costs that may be incurred on the full
realisation of the Company’s portfolio in the event of a simple
winding up;
·the use of a rollover vehicle will enable Eligible Shareholders
to avoid dealing and other costs associated with a share sale or
purchase in the secondary market (although there will be costs
incurred by holders of BRFI C Shares); and
·for those Shareholders that elect to receive cash and for
Restricted Shareholders, the Proposals offer the certainty of a
realisation for cash as soon as practicable following
implementation.
BlackRock Frontiers Investment Trust
plc
BRFI is a closed-ended investment company incorporated in
England and Wales on 15 October
2010 with an investment objective of achieving long term
capital growth from investing in companies domiciled or listed in,
or exercising the predominant part of their economic activity in,
less developed countries. These countries are any country which is
neither part of the MSCI World Index of developed markets nor one
of the eight largest countries by market capitalisation in the MSCI
Emerging Markets Index as at 1 April
2018: being Brazil,
China, India, Korea, Mexico, Russia, South
Africa and Taiwan. BRFI
carries on business as an investment trust within the meaning of
Chapter 4 of Part 24 of the Corporation Tax Act 2010.
As at 17 October 2018 BRFI held 66
investments with an aggregate value of US$352 million. As at 17 October 2018
the unaudited net asset value (cum-income) of BRFI was £267,716,235
and the unaudited net asset value per BRFI Ordinary Share
(cum-income) was 131.56 pence.
The BRFI C Shares
BRFI C Shares are a transient class of shares: the assets
representing the net proceeds of any issue of BRFI C Shares will be
maintained, managed and accounted for as a separate pool of capital
of BRFI until those BRFI C Shares convert into BRFI Ordinary Shares
(which will occur once substantially all of the assets representing
the net proceeds of the Issues have been invested in accordance
with BRFI’s investment policy (or, if earlier, six months after the
date of issue of the BRFI C Shares)). On such Conversion, each
holder of BRFI C Shares will receive such number of BRFI Ordinary
Shares as equals the number of BRFI C Shares held by them
multiplied by the net asset value per BRFI C Share and divided by
the net asset value per BRFI Ordinary Share, in each case as at a
date shortly prior to Conversion.
Costs of the Proposals
The direct costs of the Proposals payable by the Company are
expected to be approximately £392,000 (including VAT, where
applicable) and will be borne by the Company. These costs have been
accrued in the Company's net assets and represent approximately
0.32 per cent. of the Company’s net assets as of close of business
on 16 October 2018. In addition,
there will be additional costs associated with selling down the
portfolio including broker commission, depositary receipt fees and
local market taxes as well as the market value impact of selling
down the portfolio over a short time period. To the extent that
these costs can be reliably estimated they will be accrued in the
NAV.
The costs of the Issues will be
payable out of the Gross Proceeds of the Issues (including the
value of the Rollover Pool). In the event that the costs and
expenses of the Issues (excluding, for the avoidance of doubt,
transaction costs incurred in connection with the deployment of the
proceeds of the Issues) exceed one per cent. of the Gross Proceeds,
the excess costs will be offset against any amounts payable by BRFI
to the Manager for management fees. For the avoidance of doubt, any
offset shall apply against the management fees payable in respect
of the BRFI C Shares or be taken account of as part of the
Conversion, such that there is no impact, positive or negative, on
the amount of the management fees payable in respect of existing
BRFI Ordinary Shares.
Overseas Shareholders and Restricted
Shareholders
Overseas Shareholders (other than Restricted Shareholders) are
entitled to participate in the Scheme. However, where the Directors
and/or the BRFI Directors, acting reasonably, consider that any
offer or issue of BRFI C Shares to those Overseas Shareholders
would or may involve a breach of the securities laws or regulations
of any jurisdiction, or if the Directors and/or the BRFI Directors
reasonably believe that the same may violate any applicable legal
or regulatory requirements or may require BRFI to become subject to
additional regulatory requirements (to which it would not be
subject but for such issue) and the Directors and/or the BRFI
Directors have not been provided with evidence reasonably
satisfactory to them that the relevant Overseas Shareholders are
permitted to be offered, issued or to hold BRFI C Shares under any
relevant securities laws or regulations of such overseas
jurisdictions (or that BRFI would be subject to any additional
requirements to which it would not have been subject but for such
issue), such Overseas Shareholders will be deemed to have elected
for the Cash Option.
Restricted Shareholders shall not be entitled to receive BRFI C
Shares, but shall instead be deemed to have elected for cash
pursuant to the Cash Option under the Scheme. The amount of cash to
which Restricted Shareholders will be entitled will be determined
in the same way as it is for all other Shareholders who elect (or
who are deemed to have elected) for cash.
General Meetings
The implementation of the Proposals will require Shareholders to
vote in favour of the Resolutions at the General Meetings, which
have been convened for 2.00 p.m. on
15 November 2018 in respect of the
First General Meeting and 12 noon on 23
November 2018 in respect of the Second General Meeting. The
General Meetings will both be held at the offices of BlackRock
Investment Management (UK) Limited, 12 Throgmorton Avenue,
London EC2N 2DL.
The Resolutions to be proposed at the First General Meeting and
the Second General Meeting are conditional upon each other and, if
any of the Resolutions are not passed, the Proposals will not be
implemented.
A copy of the Notice for each of the General Meetings is
included in the Circular which will shortly be posted to
Shareholders. A copy of the Circular will be submitted to the
National Storage Mechanism at http://www.morningstar.co.uk/uk/NSM
and will shortly be available for inspection at
www.blackrock.co.uk/beep. The Circular will also be available
from the Company's registered office, 12 Throgmorton Avenue,
London EC2N 2DL.
Recommendation
The Board considers the Proposals to
be in the best interests of the Company and Shareholders as a
whole. Accordingly, the Board unanimously recommends Shareholders
to vote in favour of the Resolutions to be proposed at the General
Meetings as the Directors intend to do in respect of their own
beneficial holdings totalling 207,606 Ordinary Shares (representing
0.6 per cent. of the total voting rights attaching to the Ordinary
Shares).
The Directors intend to elect for the Rollover Option in respect
of their own beneficial holdings in the Company. However, the
Directors make no recommendation to Eligible Shareholders as to
whether or not they should elect to receive BRFI C Shares or cash
under the Scheme. In particular, the Directors are not responsible
for, pass no judgment on, and are not offering, BRFI C Shares. The
BRFI C Shares are offered on the terms of the enclosed Prospectus
which can be found on the BRFI website at www.blackrock.co.uk/brfi,
which is the sole responsibility of BRFI and for which the Board
and the Company accept no responsibility.
Whether or not Eligible Shareholders decide to elect for BRFI C
Shares or cash will depend, among other things, on their individual
circumstances including their tax position.
Timetable
Latest time and date for
receipt of Forms of Election or TTE Instructions from Eligible
Shareholders |
1.00 p.m. on 8
November 2018 |
Latest time and date for
receipt of Forms of Proxy from Shareholders in respect of the First
General Meeting |
2.00 p.m. on 13
November 2018 |
Record Date for the
calculation of Shareholders’ entitlements under the Scheme |
6.00 p.m. on 13
November 2018 |
Ordinary Shares disabled
in CREST* |
6.00 p.m. on 13
November 2018 |
First General
Meeting |
2.00 p.m. on 15
November 2018 |
Latest time and date for
receipt of Forms of Proxy from Shareholders in respect of the
Second General Meeting |
12.00 noon on 21
November 2018 |
Calculation Date |
5.00 p.m. on 21
November 2018 |
Ordinary Shares
reclassified as Reclassified Shares in the Official List and
dealings in Reclassified Shares commence** |
8.00 a.m. on 22
November 2018 |
Listing of Reclassified
Shares on the Official List suspended** |
7.30 a.m. on 23
November 2018 |
Second General
Meeting and commencement of voluntary liquidation of the
Company |
12.00 noon on 23
November 2018 |
Effective Date for
implementation of the Scheme |
26 November
2018 |
Admission of BRFI C
Shares and dealings in BRFI C Shares issued to Eligible
Shareholders under the Scheme |
27 November 2018 |
CREST accounts credited
with BRFI C Shares |
27 November 2018 |
Cheques expected to be
despatched in respect of the Cash Option and CREST payments made to
Shareholders on or as soon as practicable thereafter |
w/c 3 December
2018 |
Certificates despatched
in respect of new BRFI C Shares on or as soon as practicable
after |
w/c 3 December
2018 |
Cancellation of listing
of Reclassified Shares on the Official List** |
As soon as practicable
after the Effective Date |
* |
For the avoidance of
doubt the Company’s register of members will remain open until the
commencement of voluntary liquidation of the Company. |
** |
Reclassified Shares
are a technical requirement of the Scheme and will be created if
the resolutions to be proposed at the First General Meeting are
passed and become effective. |
|
|
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Defined terms used in this announcement have the meanings given
in the Circular unless the context otherwise requires.
Enquiries:
BlackRock Investment
Management (UK) Limited
Simon White
Sarah Beynsberger |
020 7743 3000 |
Winterflood Securities
Neil Langford
Chris Mills |
020 3100 0000 |
Important Information
This announcement contains information that is inside
information for the purposes of the Market Abuse Regulation (EU)
No. 596/2014, and is being made by the Company solely to comply
with its regulatory disclosure obligations.
The content of this announcement has been prepared by, and is
the sole responsibility of, BlackRock Emerging Europe plc. The
information contained in this announcement is given at the date of
its publication (unless otherwise marked) and is subject to
updating, revision and amendment from time to time. Neither the
content of the Company's website nor any website accessible by
hyperlinks to the Company's website is incorporated in, or forms
part of, this announcement.
The making of the Proposals in, or to persons who are citizens
or nationals of, or resident in, jurisdictions outside of the
United Kingdom or to custodians,
nominees or trustees for citizens, nationals or residents of
jurisdictions outside the United
Kingdom may be prohibited or affected by the laws of the
relevant overseas jurisdiction. Persons who are not resident in the
United Kingdom should read the
paragraph headed "Overseas Shareholders and Restricted
Shareholders" set out in paragraph 11 of Part I of the Circular and
should inform themselves about, and observe, any applicable legal
requirements.
This announcement does not constitute or form part of any offer
or invitation to sell, or any solicitation of any offer to purchase
or subscribe for any shares 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 therefore. The Cash Offer and the
Rollover Offer are being made pursuant to the Circular, the related
Form of Election and, in the case of the Rollover Offer, the
Prospectus relating to BRFI. The Circular should be read in
conjunction with the Prospectus which has been prepared in
accordance with the Prospectus Rules, approved by the Financial
Conduct Authority in accordance with Section 84 of the FSMA and
made available to the public in accordance with the Prospectus
Rules. Investors should not subscribe for any BRFI C Shares
referred to in this announcement or the Circular except on the
basis of information provided in the Prospectus.
The full terms and conditions of the Proposals are set out in
the Circular, which should be read in full in conjunction with this
announcement.
Winterflood Securities Limited, which is authorised and
regulated by the Financial Conduct Authority in the United Kingdom, acting through its division,
Winterflood Investment Trusts ("Winterflood"), is acting
exclusively for the Company and no-one else in connection with the
Proposals and will not be responsible to anyone other than the
Company for providing the protections afforded to customers of
Winterflood or for providing advice in relation to the Proposals.
Nothing in this paragraph shall serve to exclude or limit any
responsibilities which Winterflood may have under the FSMA or the
regulatory regime established thereunder.
Apart from the responsibilities and liabilities, if any, which
may be imposed on Winterflood by the FSMA or the regulatory regime
established thereunder, Winterflood accepts no responsibility
whatsoever for the contents of this announcement or for any other
statement made or purported to be made by it or on its behalf in
connection with the Company or the Proposals. Winterflood
accordingly disclaims all and any liability whether arising in tort
or contract or otherwise (save as referred to above) which it might
otherwise have in respect of this announcement or any such
statement.
This announcement contains (or may contain) certain
forward-looking statements with respect to the Company's current
expectations and projections about future events. These statements,
which sometimes use, but are not limited to, words such as
'anticipate', 'believe', 'intend', 'estimate', 'expect' and words
of similar meaning, reflect the Directors' beliefs and expectations
and involve a number of risks, uncertainties and assumptions that
could cause actual results and performance to differ materially
from any expected future results or performance expressed or
implied by the forward looking statement. Statements contained in
this announcement regarding past trends or activities should not be
taken as a representation that such trends or activities will
continue in the future. The information contained in this
announcement is subject to change without notice and, except as
required by applicable law, neither the Company nor Winterflood
assumes any responsibility or obligation to update publicly or
review any of the forward looking statements contained herein. You
should not place undue reliance on forward-looking statements,
which speak only as of the date of this announcement.