TIDMAIM
RNS Number : 5140L
AIM Investments PLC
02 August 2011
2 August 2011
AIM Investments Plc
("AIM Investments" or the "Company")
Adoption of New Investing Policy
Notice of AGM
Notice of GM
Introduction
Following last year's developments, and the injection of capital
into the Company by Desmond, the Directors have reviewed the
Company's strategy and believe that shareholder value would be
enhanced by a building a closer relationship with Desmond, through
their proposed appointment as Investment Manager, and the adoption
of the New Investing Policy, focussing on the agricultural, energy,
engineering, infrastructure, manufacturing, logistics,
transportation and natural resource sectors in emerging and
frontier markets, all as set out below.
The proposed adoption of the New Investing Policy will be
considered at the Company's AGM on Wednesday 24 August 2011. A
Circular continuing the proposal to adopt the New Investing Policy
and the Notice of AGM is today being posted to Shareholders
Background
On 13 October 2010, the Company announced that it had secured a
non-interest bearing loan facility of up to GBP500,000 from
Desmond, a Hong Kong-based investment company, in order to make
qualifying investments under its investing policy. On 2 November
2010, it was announced this loan facility had been increased up to
GBP700,000. The Company agreed to pay Desmond a fee of GBP120,000
for providing the Desmond Loan, such fee to be satisfied, following
the lifting of the suspension of the trading in the Company's
shares, by the issue of such number of new ordinary shares in the
capital of the Company as equated to 29.99 per cent. of the
Company's then issued share capital. Following the restoration of
trading in the Company's shares on 10 December 2010, this fee was
satisfied, and Desmond were issued with 29.99% of the Company's
issued share capital on 15 December 2010. On 15 December 2010, Mark
Pajak, both a director and a shareholder in Desmond, was appointed
to the board of the Company as a Non-Executive Director. On 16
March 2011, Mark became an Executive Director of the Company. On 28
June 2011, it was subsequently announced that Sir Bernard Zissman
had resigned as Non-Executive Director and Acting Chairman to be
replaced in the latter role by Mark Pajak. Furthermore, Balbir
Bindra was appointed as a Non-Executive Director.
Background on Desmond
Desmond is an unquoted investment company established in Hong
Kong. The management of Desmond have over 15 years' experience in
investing in emerging and frontier markets, and have managed gross
assets of over $500million. Over this period, Desmond has
established an extremely wide network of relationships across the
globe, which now generate a high volume of prospective investment
opportunities, in particular, but not exclusively, in South
America, China and Sub-Saharan Africa. Desmond's track record and
the access they provide to relationships in the Company's target
markets make Desmond an ideal strategic partner for the Company.
Mark Pajak is a director and shareholder of Desmond.
Management Services Agreement
Conditional upon the adoption of the New Investing Policy, the
Company will enter into a Management Services Agreement with
Desmond, whereby Desmond will be retained as the Company's
Investment Manager. Pursuant to the Management Service Agreement,
Desmond agrees to originate potential investments and undertake the
necessary due diligence before submitting an investment proposal
for approval by the Board. Desmond may also assist in any
negotiations regarding the structuring of a proposed investment.
Desmond will also manage the portfolio of investments held by the
Company, monitoring the individual performances of each investment
and reporting to the Board. Desmond will also assist in
implementing any exit or realisation determined by the Board.
In addition, the Investment Manager agrees to provide some
administrative functions in respect of the Company's
operations.
In consideration for the services provided by the Investment
Manager to the Company pursuant to the Management Services
Agreement, the Company shall pay the Investment Manager the
Services Fee, equal to the greater of GBP17,500 or 0.25% of the NAV
payable per quarter. In addition to the Services Fee, the Company
shall pay the Investment Manager an annual Performance Fee equal to
20% of the increase in the NAV.
Payment of the Performance Fee is conditional upon the increase
in the NAV per Share over the relevant year, being at least the
Hurdle Rate (5%). If, in any year, the Hurdle Rate is not achieved
and no Performance Fee is payable to the Investment Manager, then
before any Performance Fee is payable in a subsequent year, the
aggregate increase in NAV per share over the periods must exceed
the aggregated Hurdle Rate for those periods, and then the
Performance Fee shall be equal to 20% of the difference.
The Services Fee and Performance Fee will be payable by the
Company to the Investment Manager, at the sole option of the
Investment Manager, in cash or, subject to regulatory approval,
Ordinary Shares.
New Investing Policy
The Directors propose to amend the Company's investing policy,
as follows.
The Company's Investing Policy would be to invest in or acquire
a portfolio of companies, partnerships, joint ventures, businesses
or other assets in emerging and frontier markets (particularly
South America, Africa and Asia), as well as rapidly growing
economies and economies undergoing or recovering from some form of
crisis. The principal sectors would be energy, infrastructure,
engineering, manufacturing, logistics, natural resources,
transportation and agriculture. The investments or acquisitions may
be funded wholly by cash, the issue of new shares or debt, or a mix
thereof, as the Board deems appropriate. The Company's equity
interest in a proposed investment may range from a minority
position to 100 per cent. ownership; the proposed investments may
be either quoted or unquoted, although will likely be unquoted in
the majority of cases.
The Company will specifically invest in investments which the
Board believes offer high growth opportunities or steady cash flows
and where the exit will be a liquidity event, such as a trade sale
or IPO. However, the Company's investments may also take the form
of private placements in companies that are already listed on an
international exchange but are seeking additional capital to expand
operations or make acquisitions. It is anticipated that the
investments will be held for the short to medium term but the Board
will place no minimum or maximum limit on the length of time that
any investment may be held. The Company intends to deliver
Shareholder returns through capital growth. As such, the Board do
not envisage the distribution of dividends in the short to medium
term.
The Company intends to be an involved and active investor.
Accordingly, where necessary, the Company may seek participation in
the day to day management through board representation in an entity
in which the Company invests with a view to seeking to improve the
performance and use of its assets in order to grow the business. In
this instance, the Investment Manager will be appointed to the
board of such entities in which the Company invests. The Investment
Manager may appoint consultants or independent industry experts or
other representatives to represent the Company in managing the
investments it makes and/or their business operations.
As an active investor, the Company may be involved in such
activities as reverse takeover transactions, formation or
identification of capital pool companies, going private
transactions, advisory services (to assist companies with the
identification, assessment and "spin-in" of products and/or
subsidiaries, which may be strategic to building their businesses),
and financial restructuring. Advisory fees may be charged at the
Company's discretion.
If it appears unlikely that the investing policy can be
implemented at any time, the Directors may consider returning any
remaining funds to the Shareholders.
The Directors consider that as investments are made, and new
opportunities arise, further funding of the Company will be
required.
Investment Process
The following list details qualifying criteria for companies and
assets the Company would consider as potential investments,
although the list is not intended to be exhaustive and the
Investment Manager will exercise discretion where necessary when
submitting a potential investment for consideration by the
Board.
-- The key consideration will be the quality of the investee
company or asset, and whilst there will be a preference for those
operating in emerging, frontier and rapidly growing economies,
other geographical locations will be considered including economies
in crisis or transition.
-- Growth potential will be the key determinant above any
specific industry sector
-- Strong operational management team
-- The Company may choose to invest in newly formed or early
stage asset backed companies without any track record
-- The Company may also consider private placements in companies
that are already listed on an international exchange but are
seeking additional capital to expand operations or make
acquisitions
As detailed in the terms of the Management Services Agreement,
prospective investment opportunities will be identified by the
Investment Manager. The Investment Manager is responsible for
conducting appropriate levels of due diligence in investee
companies / assets before preparing a submission to the Board.
Related Party Transaction
Under AIM Rule 13, the appointment of Desmond as Investment
Manager constitutes a related party transaction. Desmond holds
23.14% in the Company. Mark Pajak is a director and shareholder in
Desmond. The Independent Directors consider, having consulted with
the Company's nominated adviser Daniel Stewart & Company plc,
that the terms of the transaction are fair and reasonable insofar
as the shareholders of the Company are concerned.
Notice of GM
The Company is also convening a general meeting immediately
following the AGM on Wednesday 24 August 2011. The business of the
GM, pursuant to section 656 of the Act where the net assets of a
public company are half or less than its called-up share capital,
is to consider whether any, and if so what, steps should be taken
to deal with the situation. The Notice of GM is included within the
Circular being posted to Shareholders today.
For further information please contact:
Alexandra Eavis, Mark
AIM Investments Plc Pajak 020 7002 1027
Daniel Stewart & Company
(Nominated Adviser and Antony Legge, James
Broker) Thomas 020 7776 6550
www.aiminvestmentsplc.com
The Circular may be viewed in its entirety on, or downloaded
from, the Company's website www.aiminvestmentsplc.com .
Definitions
"Act" the Companies Act 2006;
"AGM" the annual general meeting
of the Company, to be held
at the offices of Daniel Stewart,
Becket House, 36 Old Jewry,
London EC2R 8DD at 11.00am
on Wednesday 24 August 2011;
"AIM Investments" or "Company" AIM Investments Plc;
"Circular" the circular dated 1 August
containing the details of the
proposed New Investing Policy
and the Notice of AGM and the
Notice of GM
"Desmond" Desmond Holdings Ltd, a Hong
Kong based investment company;
"Desmond Loan" a non-interest bearing loan
facility of up to GBP700,000
from Desmond to the Company,
as announced on 1 November
2010;
"Directors" or "Board" the Directors of the Company,
being Alexandra Eavis, Andrew
Fletcher, Mark Pajak and Balbir
Bindra;
"Form of Proxy" the form of proxy enclosed
with the circular to be completed
and returned in respect of
the AGM;
"GM" or "General Meeting" the general meeting of the
Company, to be held at the
offices of Daniel Stewart,
Becket House, 36 Old Jewry,
London EC2R 8DD at 11.30am,
or, if later, immediately after
the AGM, on Wednesday 24 August
2011;
"Hurdle Rate" the level of increase in the
Company's NAV at which the
Performance Fee becomes payable,
being 5%;
"Independent Directors" Alexandra Eavis, Balbir Bindra
and Andrew Fletcher;
"Investment Manager" the Company's investment manager,
being Desmond;
"Management Services Agreement" an agreement to be entered
into by the Company and Desmond,
conditional upon the adoption
of the New Investing Policy,
whereby Desmond will act as
the Investment Manager
"NAV" or "Net Asset Value" the aggregate book value of
the Company's gross assets
less an amount equal to the
Company's liabilities;
"NAV per Share" or "Net Asset the audited NAV divided by
Value per Share" the number of shares in issue
at the period end;
"New Investing Policy" the new investing policy, as
set out in this announcement,
proposed by the Company in
Resolution 9 of the AGM;
"Notice of AGM" the notice of AGM sent to shareholders;
"Notice of GM" the notice of GM sent to shareholders;
"Ordinary Shares" the ordinary shares in the
Company of 0.1p each;
"Performance Fee" a fee payable by the Company
to the Investment Manager pursuant
to the Management Services
Agreement, equal to 20% of
the annual increase in the
NAV over a year, conditional
upon such increase exceeding
the Hurdle Rate;
"Report and Accounts" the report and accounts of
the Company for the twelve
month period ended 31 May 2011;
"Services Fee" a fee payable by the Company
to the Investment Manager for
the provision of services pursuant
to the Management Services
Agreement; and
"Shareholders" holders of Ordinary Shares;
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCKMGGRDMNGMZM
AIM Investments (LSE:AIM)
Historical Stock Chart
From Mar 2024 to Apr 2024
AIM Investments (LSE:AIM)
Historical Stock Chart
From Apr 2023 to Apr 2024
