REG - abrdn Latin American - Recommended Proposals for Winding-Up of Company

abrdn Latin American Income FundAnnouncement

18/05/2023 07:00

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RNS Number : 7754Z  abrdn Latin American Income Fund Ld  18 May 2023

abrdn Latin American Income Fund Limited

Legal Entity Identifier (LEI): 549300DN623WEGE2MY04

 

RECOMMENDED PROPOSALS FOR THE SUMMARY WINDING-UP OF THE COMPANY

1.         Introduction

Further to the announcement made on 15 March 2023, the Board is putting
forward proposals for the Summary Winding-up of the Company under the
Companies (Jersey) Law 1991.   A circular to Shareholders (the "Circular")
will be posted today that provides details of the Proposals, which are subject
to Shareholder approval, and sets out the Board's recommendation in favour of
the Resolutions to be proposed at the General Meeting of the Company to be
held on the 12 day of June 2023 at 9:30 am.  A notice of the General Meeting
is set out in the Circular.

The Circular will shortly be available on the Company's website at
www.latamincome.co.uk.

2.         Background to the Proposals

It was stated in the Chairman's Statement in the 2022 Annual Report that the
preceding financial year had been volatile for investors in a period during
which the Company's equity investments underperformed, predominantly due to a
shift in market focus from growth to value stocks. The political and economic
challenges facing the Latin American economies have also adversely impacted
the performance of the Company. Furthermore, wider global events, including
extreme weather and the war in Ukraine, have resulted in higher commodity
prices and put pressure on the global supply chain. While some businesses have
seen a positive impact from higher energy prices, higher food and fuel prices
added to the inflationary environment that led central banks to start raising
policy rates.

While the Board believes that the Company's strategy remains attractive in the
longer term, it is aware that the Company's small size makes it difficult to
attract significant demand for its shares and that the discount at which the
shares trade to net asset value is likely to persist.

As announced on 15 March 2023, the Board has considered the views of its
largest Shareholder and its professional advisers and, taking into account the
composition of the share register as a whole, believes that the summary
winding-up of the Company with the net cash proceeds of the liquidation being
returned to Shareholders is in the best interests of Shareholders generally.

In considering the options available, the Board was mindful of the costs that
would be incurred in proposing a reconstruction of the Company that allowed
Shareholders to elect to receive shares or interests in another investment
vehicle without being deemed to make a disposal for the purposes of UK capital
gains tax. The Board concluded that such costs were disproportionate relative
to the size of the Company and the expected small constituency of Shareholders
for whom such an option would be attractive.

3.         Summary Winding-up

The Proposals involve the Company being placed, with the approval of
Shareholders, into Summary Winding-up.  If the Resolution is passed at the
EGM and the Joint Liquidators are appointed, the Joint Liquidators will wind
up the Company in accordance with the Companies (Jersey) Law 1991.  It is
currently expected that the Portfolio will be realised for cash ahead of the
EGM.  In this case, the Joint Liquidators would expect to distribute the cash
proceeds of the liquidation of the Portfolio, less the costs of the Summary
Winding-up and the amount attributable to the Liquidation Fund described below
to those Shareholders appearing on the Register as at the Record Date as soon
as reasonably practicable (the Initial Distribution).

The Board estimates that the costs and expenses of the Proposals will amount
to approximately £320,000, which include the fees of the Joint Liquidators
and those of the Company's advisers in connection with the Winding-up.  These
costs and expenses will be provided for in the daily net asset value
publication starting in respect of close of business at today's date. The
Joint Liquidators will establish the Liquidation Fund in cash to pay the
Company's known and contingent liabilities (including any relevant value added
tax or goods and services tax), the costs of liquidation not already paid at
the point of liquidation and an additional retention of £100,000 for unknown
contingencies.

Once the Joint Liquidators have made the Initial Distribution, satisfied
claims of creditors of the Company and paid the costs and expenses of the
Summary Winding-up, it is expected that the Joint Liquidators will make a
final distribution to Shareholders according to their respective rights and
interests in the Company.  This final distribution, if any, will not be made
until the Joint Liquidators have completed their statutory duties to seek out,
adjudicate and pay creditors' claims and the Jersey Comptroller of Revenue has
confirmed it has no objection to the closure of the liquidation.  The
precise timing of this final distribution (if any) is uncertain and is likely
to be of a nominal amount per Ordinary Share, but it is expected to be paid
within 12 months of the commencement of the Summary Winding-up.

4.         Suspension and cancellation of the Company's listing and
trading

The Register will be closed at 6:00 pm (BST) on 9 June 2023 and the Ordinary
Shares will be disabled in CREST at the start of business on 12 June 2023.
 Application will be made to the FCA for suspension of the listing of the
Ordinary Shares on the Official List and application will be made to the
London Stock Exchange for suspension of trading in the Ordinary Shares at 7:30
am (BST) on 12 June 2023.  The last day for dealings in the Ordinary Shares
on the London Stock Exchange on a normal rolling two day settlement basis will
be 8 June 2023.

After close of business on 8 June 2023, dealings should be for cash settlement
only and will be registered in the normal way if the transfer, accompanied by
the documents of title, is received by the Registrars by close of business on
9 June 2023.  Transfers received after that time will be returned to the
person lodging them and, if the Winding-up Resolution is passed, the original
holder will receive any proceeds from distributions made by the Joint
Liquidators.

The Company will also make an application for the cancellation of the
admission of the Ordinary Shares to listing on the Official List and to
trading on the Main Market, subject to the Resolutions being passed, with
cancellation expected to take effect at 8:00 am (BST) on 14 June 2023.

5.         The ResolutionS

The Summary Winding-up is subject to Shareholder approval at the EGM and will
not be implemented if the Resolutions are not passed.

At the EGM, Shareholders will be asked to approve the following matters
pursuant to the Resolutions:

1.         that the Company be summarily wound up in accordance with
the provisions of Article 146 of the Companies (Jersey) Law 1991;

2.         that, if Resolution 1 carries, Linda Maree Johnson and
Louis Leonard Gerber of KPMG Advisory Limited, 37 Esplanade, St Helier,
Jersey, JE4 8WQ having consented to act, be and are appointed as joint
liquidators of the Company for the purposes of the summary winding-up of the
Company, with the power to act jointly and severally for the purposes of the
summary winding-up, including distributing the Company's assets and any power
conferred on them by law or by the Resolution;

3.         that, if Resolution 2 carries, the remuneration of the
Joint Liquidators be determined by reference to the time properly given by
them and their staff in attending to matters prior to and during the
winding-up of the Company and they be and are authorised to draw such
remuneration monthly or at such longer intervals as they may determine and to
pay any expenses properly incurred by them; and

4.         that, the Company be released from the obligation to
prepare or deliver any accounts or financial statements (whether audited or
unaudited) or reports to the members, save pursuant to any mandatory
requirement imposed by any law, regulation or listing rules, starting on the
first day of the current financial period and ending on the date the Summary
Winding-up is completed.

6.         The General Meeting

A Notice convening the General Meeting to be held at Sir Walter Raleigh House,
48-50 Esplanade, St Helier, Jersey, JE2 3QB on the 12 day of June 2023 at 9:30
am (BST), is set out in the Circular.  The Notice includes the full text of
the Resolutions.

The quorum for the EGM will be two Shareholders present in person, by proxy or
by corporate representative and arrangements will be made by the Company to
ensure that the minimum of two Shareholders required to form a quorum will
attend the EGM in order that it may proceed and the business be concluded. It
is not required that the Directors or representatives of the Manager (save to
the extent that such persons are required to form a quorum) will be present in
person.

There are special arrangements for holders of ordinary shares through the
abrdn Share Plan and Investment Trust ISA. These are explained in the 'Letter
of Direction' which such holders will have received with the Circular.

7.         Expected timetable - 2023

 Action                                                                           Timeline
 Publication of the Circular                                                      18 May
 Latest time and date for receipt of Letters of Direction from abrdn Plan         9:30 am on 5 June
 Participants for use at the General Meeting
 Date from which it is advised that dealings in Ordinary Shares should only be    Close of business on 8 June
 for cash settlement and immediate delivery of documents of title
 Latest time and date for receipt of Forms of Proxy from Shareholders for use     9:30 am on 8 June
 at the General Meeting
 Latest time for delivery to Registrars of documents of title relating to         5 pm on 9 June
 dealings in Ordinary Shares subject to cash settlement
 Close of the Register and Record Date for participation in the Summary           6 pm on 9 June
 Winding-up
 Suspension of Ordinary Shares from trading on the London Stock Exchange and      7:30 am on 12 June
 suspension of listing on the Official List
 General Meeting to approve the Summary Winding-up and, if approved, the          9:30 am on 12 June
 appointment of the Joint Liquidators
 Announcement of the result of the General Meeting                                12 June
 Cancellation of the listing of the Ordinary Shares on the Official List and       8 am on 14 June
 cancellation of admission to trading of the Ordinary Shares on the Main Market
 Expected date for payment of Initial Distribution*                               As soon as reasonably practicable

*   Actual date to be determined by the Joint Liquidators

All references to time are to the time in Jersey.

The dates and times set out in the expected timetable above may be adjusted by
the Company, in which event details of the new dates and/or times will be
notified to the FCA and the London Stock Exchange, and an announcement will
be made through a Regulatory Information Service.

Capitalised words in this announcement bear the meanings given to them in the
Circular, unless the context otherwise required.

A copy of the Circular has been submitted to the U.K. National Storage
Mechanism and will shortly be available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism)

 

abrdn Capital International Limited

Secretary

 

Enquiries

Howard Myles, Chairman, via Singer Capital Markets

Robert Peel, Singer Capital Markets, +44 20 7496 3000

 

 

 

 

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