TIDMBCGR
RNS Number : 2997O
Blue Capital Global Reinsurance Fnd
04 November 2016
Blue Capital Global Reinsurance Fund Limited (the "Company")
(Ticker: "BCGR")
4 November 2016
Publication of Circular
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
Further to the announcement on 2 September 2016, the Company has
today published a circular to Shareholders in connection with the
proposed tender offer (the "Circular"). The full text of the
Circular will shortly be available on the Company's website,
http://ir-bcgr.bluecapital.bm. The Circular and associated
documentation will be sent to certificated shareholders in due
course.
Full details of the Tender Offer are set out in the Circular
which should be read carefully by Shareholders.
Background
At launch, the Company established a discount management policy,
which was described in the prospectus. The policy sets out a number
of guidelines regarding the operation of share buy-backs and/or
tender offers to manage any discount between the Company's Net
Asset Value and the price at which its Ordinary Shares are
trading.
In particular, the policy provides that where Ordinary Shares
have traded at an average discount of more than 5% to the Net Asset
Value per Ordinary Share calculated over the three month period
ending on 31 August in each year (the "Discount Trigger"), the
Directors are obliged to make a tender offer and that any such
tender offer is expected to offer Shareholders the opportunity to
tender up to 25% of the Ordinary Shares in issue at the time the
tender offer is made.
As was announced on 2 September 2016, the Discount Trigger has
been met. As prescribed in the discount management policy, the
Board is obliged to make a tender offer to Shareholders; however,
the Board has discretion as to the terms on which such tender offer
is made. In this regard, the Company and its advisers have
consulted with approximately 84% of its independent Shareholders, a
majority of whom have indicated that they do not wish the Company
to reduce in size. Based on this feedback, but cognisant of the
obligation to put in place a tender offer, the Board has determined
that the Tender Offer will be for up to 10% of the Ordinary Shares
in issue, and have resolved to combine the Tender Offer with share
buy-backs, as and when considered appropriate. The Board believes
that this approach is likely to be more effective in managing the
Company's trading discount, compared to operating a larger tender
offer without the support of additional share buy-backs.
Tender Offer
The Tender Offer is available to Qualifying Shareholders on the
register of members of the Company on the Tender Offer Record Date.
All tenders of Ordinary Shares shall be made on the terms and
subject to the conditions set out in Part 2 of the Circular, and
for certificated Shareholders, the Tender Form.
The Tender Offer will be for up to 10% of the Ordinary Shares in
issue as at the Tender Offer Record Date. Each Qualifying
Shareholder will be entitled to tender and have converted into
Redemption shares (on a one-for-one basis) up to 10% of the
Ordinary Shares registered in his name on the Tender Offer Record
Date, rounded down to the nearest whole number of Ordinary Shares
(the "Basic Entitlement"). The Tender Offer will also present
tendering Shareholders with an opportunity to have more than their
Basic Entitlement repurchased. To the extent that other
Shareholders tender less than their Basic Entitlements, any such
excess tenders will be satisfied pro rata to the aggregate number
of Ordinary Shares tendered by Qualifying Shareholders in excess of
their respective Basic Entitlements, rounded down to the nearest
whole number of Ordinary Shares and subject to the overall maximum
size of the Tender Offer of 10% of the Ordinary Shares in issue as
at the Tender Offer Record Date.
The Tender Offer is not for cash. Rather a Shareholder whose
Ordinary Shares are validly tendered under the Tender Offer will
have each Ordinary Share converted into one Redemption Share (and
such conversion will be effected, as described below). Redemption
Shares are a new class of share, introduced for the purpose of this
Tender Offer and any future tender offers. The rights attaching to
the Redemption Shares are set out in the Revised Bye-laws.
Redemption Shares will continue to participate (pro rata) in
each of the underlying reinsurance contracts comprising the
Company's portfolio as at the date of their issue, with such
entitlement being recorded as being separately attributable to the
Redemption Shares in the books of the Company. The Redemption
Shares will be redeemed by the Company for cash (less costs) as
this portfolio is run-off and proceeds received from the underlying
investments. The costs of the Tender Offer are expected to be borne
by the holders of the Redemption Shares out of such proceeds.
The Tender Offer is not being satisfied immediately in cash or
for a fixed price based on the Net Asset Value per Ordinary Share
at a fixed point in time as the Board believes that to do so is
likely to be prejudicial to holders of Ordinary Shares that are not
tendered, as they will increase their proportionate exposure to
less liquid and hard-to-value investments.
Assuming that no additional loss events occur in respect of the
portfolio attributable to the Redemption Shares, the Company
anticipates (but can provide no assurances) that Redemption Shares
will be redeemed and proceeds will be distributed to Shareholders
in line with the following schedule:
Anticipated Redemption Anticipated % of Redemption
Date Shares issued on the
Tender Offer Completion
Date being redeemed
------------------------ ----------------------------
31 March 2017 50%
------------------------ ----------------------------
31 August 2017 30%
------------------------ ----------------------------
31 December 2017 20%
------------------------ ----------------------------
The Tender Offer is conditional upon the approval of the
Resolutions at the Special General Meeting and the Tender Offer not
having been terminated in accordance with paragraph 2(s) of Part 2
of the Circular at or prior to the Tender Offer Completion
Date.
The Introduction of Treasury Shares
The Company wishes to take the opportunity at the Special
General Meeting to put forward a resolution introducing the ability
for it to hold shares in treasury. The Board regards this as
standard practice for publicly-traded investment funds and will
afford the Company more flexibility in managing its share
capital.
Ordinary Shares that are repurchased under the Tender Offer will
not be held in treasury. Ordinary Shares repurchased by the Company
pursuant to the general authority to buy-back may be held in
treasury or cancelled at the discretion of the Company and subject
to any legal or regulatory requirements. There is no limit on the
number of shares that can be held in treasury. It is anticipated
that any Ordinary Shares sold out of treasury will be sold at a
premium to the then prevailing Net Asset Value and pre-emption
rights shall not apply to the sale of such treasury shares.
Terms used and not defined in this announcement will bear the
meaning given to them in the Circular.
Expected Timetable
SPECIAL GENERAL MEETING
Latest time and date for 9:00 a.m. (Bermuda time)
receipt of Forms of Instruction (1:00 p.m. UK time) on
and CREST Instructions 23 November 2016
from the Depository Interest
Holders
Latest time and date for 9:00 a.m. (Bermuda time)
receipt of Forms of Proxy (1:00 p.m. UK time) on
24 November 2016
Special General Meeting 9:00 a.m. (Bermuda time)
(1:00 p.m. UK time) on
28 November 2016
Announcement of the results By 5:00 p.m. on 28 November
of the Special General 2016
Meeting
TER OFFER
Latest time and date for 1:00 p.m. on 24 November
receipt of Tender Forms 2016
and TTE instructions from
CREST
Tender Offer Closing Date 1:00 p.m. on 24 November
2016
Tender Offer Record Date 6:00 p.m. on 24 November
2016
Announcement of the results By 5:00 p.m. on 28 November
of the Tender Offer 2016
Latest time and date for By 1:00 p.m. on 15 December
withdrawing tenders 2016
Tender Offer Completion 30 December 2016
Date: Completion of the
Tender Offer and conversion
of tendered Ordinary Shares
into Redemption Shares
under the Tender Offer
Announcement of the completion By 5:00 p.m. on 30 December
of the Tender Offer 2016
Dispatch of shareholding 13 January 2017
statements in respect
of the Redemption Shares
Redemption of Redemption As soon as is practicable
Shares and payment of following the receipt
redemption proceeds of the Company of cash
proceeds from the Master
Fund in respect of the
Master Fund Redemption
Shares
Notes:
1. These times and dates are indicative only. If any of the
above times and/or dates change materially, the revised times
and/or dates will be notified to Shareholders by announcement
through a regulatory information service.
2. All references in this announcement to times are to the times
in London unless otherwise stated.
3. The completion of the Tender Offer, and all events in the
timetable following the Tender Offer Closing Date, are conditional,
inter alia, on the passing of Resolutions at the Special General
Meeting.
For further information please contact:
Adam Szakmary
CEO & Portfolio Manager, Blue Capital Management Ltd. +1
441-278-0400
Adam.Szakmary@bluecapital.bm
Gary Gould/Alex Collins +44 20 7029 8000
Jefferies International Limited
This information is provided by RNS
The company news service from the London Stock Exchange
END
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