REG - Aquila Eur Renwables Aquila Euro Rnw-AERI - Adoption of B sharescheme proposal & Notice of GM
15/12/2025 07:00
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RNS Number : 4671L Aquila European Renewables PLC 15 December 2025
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are
in any doubt about the contents of this document or what action you should
take, you should consult your stockbroker, bank manager, solicitor or other
appropriate independent financial adviser who is authorised under the
Financial Services and Markets Act 2000 (as amended) ("FSMA") if you are
resident in the United Kingdom, or who is duly authorised under the European
Communities (Markets in Financial Instruments) Regulation 2017 (as amended) or
Investment Intermediaries Act 1995 (as amended) if you are resident in
Ireland, or another appropriately authorised independent financial adviser if
you are resident in a territory outside Ireland or the United Kingdom.
If you have sold or otherwise transferred all of your ordinary shares in the
capital of Aquila European Renewables plc ("Ordinary Shares", and the
"Company", respectively), please send this (but not any accompanying
personalised Form of Proxy) at once to the purchaser or transferee or to the
stockbroker, bank or other agent through or by whom the sale or transfer was
effected, for onward delivery to the purchaser or transferee. This document
should not, however be forwarded or transmitted in or into any jurisdiction in
which such act would constitute a violation of the relevant laws and
regulations in such jurisdiction. If you have sold or transferred only part of
your holding of Ordinary Shares you should retain this document and any
accompanying documents and contact the stockbroker, bank or other agent
through or by whom the sale or transfer was effected immediately.
AQUILA EUROPEAN RENEWABLES PLC
(Incorporated in England and Wales, registered number 11932433)
(Registered as an investment company under section 833 of the Companies Act
2006)
Recommended proposal for the adoption of a B Share Scheme to allow for the
return of capital to Shareholders
and
Notice of General Meeting
Your attention is drawn to the letter from the Chair on page 6, which
recommends that you vote in favour of the resolutions to be proposed at the
General Meeting referred to below. Capitalised terms used throughout this
document shall have the meanings ascribed to them in the section titled
Definitions of this document, unless the context otherwise requires.
Notice of General Meeting of the Company to be held at 1:00 p.m. on 8 January
2026 at the offices of CMS Cameron McKenna Nabarro Olswang LLP, at Cannon
Place, 78 Cannon Street, London, EC4N 6AF, United Kingdom (the "General
Meeting") is set out at the end of this document. Whether or not you intend to
be present at the General Meeting you are urged to complete and return a Form
of Proxy, in accordance with the instructions set out in the notes to the
Notice of General Meeting, as soon as possible and in any event by no later
than 1:00 p.m. on 6 January 2026.
To be valid, Forms of Proxy for use at the General Meeting must be completed
and returned in accordance with the instructions printed thereon to the
Company's registrar, Computershare Investor Services (the "Registrar") at The
Pavilions, Bridgwater Road, Bristol, BS99 6ZY, United Kingdom so as to arrive
no later than 1:00 p.m. on 6 January 2026.
As an alternative to completing and returning the accompanying Form of Proxy,
you may submit your proxy electronically by accessing the Registrar's online
voting portal www.investorcentre.co.uk/eproxy. For security purposes, you will
be asked to enter the control number, your shareholder reference number (SRN)
and personal identification number (PIN) to validate the submission of your
proxy online. The control number and members' individual SRN and PIN numbers
are shown on the accompanying Form of Proxy. If you are a member of CREST you
may be able to use the CREST electronic proxy appointment service. In
addition, institutional investors may be able to appoint a proxy
electronically via the Proxymity platform. Proxies submitted via a designated
voting platform (such as CREST or Proxymity) for the General Meeting must be
transmitted so as to be received by the Registrar no later than 48 hours
(excluding weekends and any bank holiday) before the time of the General
Meeting. Proxies sent electronically must be sent as soon as possible and, in
any event, so as to be received no later than 1:00 p.m. on 6 January 2026.
The Notice of General Meeting and the Form of Proxy will be submitted to the
National Storage Mechanism and shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) and on the Company's
website at https://www.aquila-european-renewables.com/
(https://www.aquila-european-renewables.com/) .
All references to times in this document are to London time, unless otherwise
stated.
This document is not a prospectus or prospectus equivalent document. This
document 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 securities,
or any offer or invitation to sell, or any solicitation of any offer to
purchase or subscribe for such Ordinary Shares by any person in any
circumstances or jurisdiction in which such offer or solicitation is unlawful.
No application will be made to (i) the Financial Conduct Authority or to the
London Stock Exchange for any of the B Shares to be admitted to the Official
List or to trading on the London Stock Exchange's main market for listed
securities or (ii) Euronext Growth for any of the B Shares to be admitted to
trading on Euronext Growth, nor will any of the B Shares be listed or admitted
to trading on any other securities or investment exchange.
The availability of the B Share Scheme and a Return of Capital to Shareholders
who are not resident in the United Kingdom may be affected by the laws of the
relevant jurisdiction in which they are located. Persons who are not resident
in the United Kingdom should read the paragraph headed "Overseas Shareholders"
set out in Part 2 of this document and should inform themselves about, and
observe, any applicable legal or regulatory requirements.
The B Shares will not be registered under the US Securities Act or with any
state or other jurisdiction of the United States, and none of the B Shares may
be reoffered, resold, pledged or otherwise transferred in or into the United
States or to any US persons except pursuant to a transaction that has been
registered under the US Securities Act and with the relevant state and other
jurisdictions or a transaction that is exempt from, or otherwise not subject
to, the securities laws of such jurisdictions.
Neither the B Shares nor this document have been approved, disapproved or
otherwise recommended by any US federal or state securities commission or
other regulatory authority or any non-US securities commission or regulatory
authority, nor have such authorities passed upon or endorsed the merits of the
B Share Scheme or a Return of Capital or confirmed the accuracy or determined
the adequacy of this document. Any representation to the contrary is a
criminal offence in the United States.
This document does not constitute an offer or invitation to participate in the
B Share Scheme or a Return of Capital in or from any jurisdiction in or from
which, or to or from whom, it is unlawful to make such an offer or invitation
to participate under applicable securities laws or otherwise.
No person has been authorised to give any information or make any
representation other than those contained in this document and, if given or
made, such information or representation must not be relied on as having been
so authorised. The delivery of this document shall not, under any
circumstances, create any implication that there has been no change in the
affairs of the Company since the date of this document or that the information
in it is correct at any subsequent time.
This document may contain "forward-looking statements" with respect to certain
of the Company's plans and its current goals and expectations relating to its
future financial condition, performance, strategic initiatives, objectives and
results. Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan", "goal",
"believe", "seek", "may", "could", "outlook" or other words of similar
meaning. By their nature, all forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances which are
beyond the control of the Company.
As a result, the actual future financial condition, performance and results of
the Company may differ materially from the plans, goals and expectations set
forth in any forward-looking statements. Any forward-looking statements made
in this document by or on behalf of the Company speak only as of the date they
are made. The information contained in this document is subject to change
without notice and except as required by applicable law or regulation, the
Company expressly disclaims any obligation or undertaking to publish any
updates or revisions to any forward-looking statements contained in this
document to reflect any changes in the Company's expectations with regard
thereto or any changes in events, conditions or circumstances on which any
such statements are based.
Table of Contents
EXPECTED TIMETABLE OF EVENTS (#_Toc216453966)
Part 1 LETTER FROM THE CHAIR (#_Toc216453967)
Part 2 DETAILS OF THE B SHARE SCHEME (#_Toc216453968)
Part 3 RIGHTS AND RESTRICTIONS ATTACHED TO B SHARES (#_Toc216453969)
Part 4 RISKS ASSOCIATED WITH THE PROPOSAL (#_Toc216453970)
Part 5 UNITED KINGDOM TAXATION (#_Toc216453971)
NOTICE OF GENERAL MEETING (#_Toc216453972)
DEFINITIONS (#_Toc216453973)
EXPECTED TIMETABLE OF EVENTS
Publication of this circular 15 December 2025
Latest time for receipt of Forms of Proxy and electronic appointments of 1:00 p.m. on 6 January 2026
proxies in respect of the General Meeting
Record time and date for the General Meeting 6.30 p.m. on 6 January 2026
General Meeting 1:00 p.m. on 8 January 2026
Notes
1. All references to time in this document are to London time,
unless otherwise stated.
2. The times and dates set out in the expected timetable above and
mentioned throughout this document may be adjusted by the Company. If any of
the times and/or dates change, the revised time(s) and/or date(s) will be
notified to Shareholders by an announcement through a Regulatory Information
Service.
Part 1
LETTER FROM THE CHAIR
Aquila European Renewables plc
(Incorporated in England and Wales with registered number 11932433)
(Registered as an investment company under section 833 of the Companies Act
2006)
Directors Registered Office
Robert Naylor 4(th) Floor
Myrtle Dawes 140 Aldersgate Street
David MacLellan London
Kenneth MacRitchie EC1A 4HY
Patricia Rodrigues United Kingdom
15 December 2025
Dear Shareholder,
Recommended proposal for the adoption of a B Share Scheme to allow for the
return of capital to Shareholders and Notice of General Meeting
Introduction
On 30 September 2024, Shareholders approved a change in the Company's
investment objective and policy to facilitate a managed wind-down of the
Company and to realise its assets in an orderly manner. To assist the Company
with returning cash, in the form of capital or by way of dividend, to
Shareholders as part of the Company's managed wind-down process, the Company
cancelled, via court order, the amount standing to the credit of the Company's
share premium account.
The net proceeds from realisations will be used to make timely returns of
capital to Shareholders (net of provisions for the Company's costs and
expenses) in such manner as the Board considers appropriate.
After careful consideration, the Board believes that one of the fairest and
most efficient way of returning substantial amounts of cash to Shareholders is
by means of a bonus issue of redeemable B Shares (with a nominal value of one
cent each) which would then be immediately redeemed by the Company in
consideration for a cash payment equal to the amount treated as paid up on the
issue of the B Shares. Adoption of the B Share Scheme is conditional on the
approval of Shareholders at the General Meeting to be held on 8 January 2026,
notice of which is set out at the end of this document. Importantly if
Shareholders pass the required Resolutions at the General Meeting, the B Share
Scheme will be able to be implemented, and cash returned to Shareholders,
without any further action being required by Shareholders. Furthermore, once
the B Share Scheme has been put in place, the Company will be able to use the
B Share Scheme to return capital to Shareholders on a periodic basis as and
when assets of the Company are sold. Any B Shares issued under the B Share
Scheme will not be listed or admitted to trading on the London Stock Exchange
or Euronext Growth or any other securities or investment exchange.
The quantum and timing of any Return(s) of Capital to Shareholders under the B
Share Scheme (if any) will be at the discretion of the Board and will be
dependent on the realisation of the Company's investments and its liabilities,
general working capital requirements and the amount and nature (from a tax
perspective) of its distributable reserves from time-to-time. On 9 September
2025, the Company completed the court-approved reduction of the full amount
standing to the credit of its share premium account, pursuant to which
€255,642,627.68 was applied to a separate special distributable reserve (the
"Special Reserve"). Since the cancellation of the share premium account,
€27,784,976 has been paid by the Company for share buy-backs and therefore
the remaining €227,887,651.68 is currently available for capital
distribution (but the total amount shall be further reduced by any further
buy-backs undertaken by the Company).
On 23 October 2025, the Company announced that it had entered into sale and
purchase agreements with funds advised by Aquila Capital for the sale of its
Danish and Greek assets (Holmen II, Svindbaek and Desfina) for a total
consideration of approximately €61.9 million. The disposals were subject to
regulatory and other customary approvals. Today, on 15 December 2025, it was
announced that the sale of Holmen II and Svindbaek had completed for €36.6
million but that the Desfina disposal remains subject to ongoing customary
approvals and, as a result of the introduction of new FDI regulations in
Greece following the signing of the share purchase agreement, is now expected
to complete in February 2026. Together with the sale of Sagres, which
completed in June 2025, this represents a total cash consideration of €78.3
million.
The Board continues to progress the divestment of the remainder of the
Company's portfolio in accordance with the Company's managed wind-down
investment policy.
An initial Return of Capital is expected to be made by the Company by late
January 2026. The Company expects the initial Return of Capital to be no less
than €33.9 million, representing the majority of proceeds received from the
disposals in 2025 (being Sagres, Holmen II and Svindbaek), excluding an
appropriate cash buffer to ensure the Company can continue to meet its
liabilities and commitments. Combined with the dividend declared on 24
November 2025 and paid on 12 December 2025 of €2.5 million and the proceeds
of the Greek Disposal, the amount is equivalent to the €63.0 million
referred to in the announcement released by the Company on 23 October 2025.
The Company intends to execute another Return of Capital promptly following
the completion of the Desfina assets again representing the majority of
proceeds received from the sale.
The purpose of this document is to provide Shareholders with further details
of the proposed B Share Scheme and to give notice of the General Meeting at
which the Resolutions required to adopt and implement the B Share Scheme will
be proposed, including amendments to the Company's Articles to allow for the
issue and redemption of B Shares.
All Shareholders are encouraged to vote in favour of the Resolutions to be
proposed at the General Meeting and, if the Ordinary Shares are not held
directly, to arrange for their nominee to vote on their behalf.
B Share Scheme
Advantages of returning cash via B Shares
The advantages of returning capital via the B Share Scheme rather than via a
tender offer are as follows:
(a) As it is currently anticipated that no further circulars
will need to be prepared to effect any future Return(s) of Capital which would
be the case if we were to implement tender offers, it reduces costs for the
Company. In the event the Resolutions are passed at the General Meeting
details of any Return of Capital would be notified to Shareholders through a
Regulatory Information Service and, subject to any change in existing United
Kingdom tax law (and in contrast to a tender offer where stamp duty at the
rate of 0.5 per cent. of the tender price is payable), no stamp duty would be
payable on a Return of Capital.
(b) Subject to the Resolutions being passed at the General
Meeting, it is not anticipated that Shareholders will be required to take any
further action to give effect to the first Return of Capital or any further
Return(s) of Capital but this will be dependent on the amount and nature of
the Company's distributable reserves from time-to-time. In light of the
capital returns under the B Share Scheme being mandatory and applicable to all
Shareholders on a pro rata basis, all Shareholders are treated equally and no
further action would be required from any Shareholders in order for them to be
able to participate in the B Share Scheme.
(c) There is greater certainty for the Company regarding the
quantum of Return(s) of Capital to Shareholders (unlike tender offers).
Disadvantages of returning cash via B Shares
However, for some Shareholders, there may be some disadvantages in returning
capital via the B Share Scheme, relating to the timing, mandatory nature of
the scheme and the way they structure their shareholding in the Company. One
consequence of this straightforward process is that Shareholders will receive
their cash payment in accordance with the structure within which they hold
their Ordinary Shares when the B Shares are issued.
How will cash be returned via the B Shares?
Subject to the Resolutions being passed at the General Meeting, the B Share
Scheme will provide the Company with a mechanism to return cash to
Shareholders at such time or times as the Board may, at its absolute
discretion, determine. B Shares would be issued to Shareholders (at no cost to
Shareholders) pro rata to their holdings of Ordinary Shares at the time of
issue of the B Shares and, shortly thereafter, redeemed and cancelled in
accordance with their terms for an amount not exceeding the amount treated as
paid up on the issue of the B Shares. The Company will not allot any fractions
of B Shares and the entitlements of each Shareholder will be rounded down to
the nearest whole B Share.
Following the redemption and cancellation of the B Shares, the redemption
proceeds will be sent to Shareholders, either through CREST to uncertificated
Shareholders or via cheque or electronic payment (if there is an electronic
payment mandate on file) to certificated Shareholders. Each issue and
redemption of B Shares would be announced via a Regulatory Information
Service.
Further details of the B Share Scheme are set out in Part 2 of this document.
Taxation of the B Share Scheme
The structure of a B Share Scheme should result in UK individual taxpayers
receiving their cash proceeds on the redemption of the B Shares as capital (to
the extent that the B Shares are issued as paid up out of amounts standing to
the credit of the Special Reserve). Based on current UK tax law and HMRC
published practice, it is expected that each redemption of B Shares should be
treated as a disposal by the Shareholder of their Ordinary Shares for UK tax
purposes. This may, subject to the Shareholder's individual circumstances and
any available exemption or relief, give rise to a chargeable gain (or
allowable loss) for the purposes of UK taxation of capital gains.
Each redemption of B Shares should be treated as the receipt of an income
distribution for corporate Shareholders for UK tax purposes.
The UK tax treatment described above refers only to B Shares to the extent
that they are issued as paid up out of amounts standing to the credit of the
Special Reserve. Any issue (and subsequent redemption) of B Shares issued as
paid up otherwise than out of amounts standing to the credit of the Special
Reserve may be subject to different tax treatment and, in particular, the
issue and redemption may give rise to an income distribution in the hands of
individual Shareholders for UK tax purposes.
For further information regarding UK taxation on redemptions of B Shares
please see Part 5 of this document.
Further information on the B Shares
No share certificates will be issued in relation to the B Shares and no CREST
accounts will be credited with any such B Shares.
No application will be made to (i) the Financial Conduct Authority or to the
London Stock Exchange for any of the B Shares to be admitted to the Official
List or to trading on the London Stock Exchange's main market for listed
securities or (ii) Euronext Group for any of the B Shares to be admitted to
trading on Euronext Growth, nor will any of the B Shares be listed or admitted
to trading on any other securities or investment exchange.
The B Shares will be non-transferable, non-equity shares and will have limited
rights. The rights and restrictions attached to the B Shares are set out more
fully in Part 3 of this document.
Shareholders should note that the default payment currency is Euro, however,
shareholders are expected to be able to elect to have their Return of Capital
paid in Sterling. The process for Shareholders to elect to receive funds in
Sterling is expected to be communicated to Shareholders via a Regulatory
Information Service in advance of any Return of Capital being made.
DIVIDENDS
The Company's ability to maintain the historic level and frequency of
distributions will decrease as the sale programme progresses through the
managed wind-down period. Distributions will still be required, however, to
ensure that the Company's investment trust status is maintained through the
process.
In addition to the level of dividend payments declining as assets are realised
and as announced on 13 February 2025, the Board implemented a change in the
Company's future dividend policy. The Board will no longer be able to provide
forward guidance as to the level of dividend for the year ahead which will be
covered by earnings and taking into account the Company's liquidity position.
Additionally, the Board will no longer seek to smooth the level of dividend
over a financial year to reduce the impact of the seasonality of earnings.
GENERAL MEETING
The Proposal is subject to Shareholder approval. The Notice of General
Meeting, that is to be held at 1:00 p.m. on 8 January 2026 to be held at the
offices of CMS Cameron McKenna Nabarro Olswang LLP, at Cannon Place, 78 Cannon
Street, London, EC4N 6AF, United Kingdom, is set out at the end of this
document. The Resolutions proposed at the General Meeting will be voted on by
way of a poll. In accordance with the Articles, all Shareholders entitled to
vote and who are present in person or by proxy at the General Meeting shall
have one vote in respect of every Share held.
Shareholders are strongly encouraged to appoint the Chair of the General
Meeting as their proxy to vote on their behalf at the General Meeting. This
should ensure that your votes are registered.
Details of the resolutions are set out below:
1. Resolution 1: Adoption of New Articles
Resolution 1 is proposed as a special resolution and relates to the adoption
of New Articles that set out the rights and restrictions attached to the B
Shares as described in Part 3 of this document.
2. Resolution 2: Capitalisation of Company reserves
Resolution 2 (which is conditional upon Resolution 1 being passed) is proposed
as an ordinary resolution and authorises the Directors to capitalise from time
to time any sums standing to the credit of any reserve of the Company
(including, in particular, the Company's new special distributable reserve
created through the cancellation of the full amount of €255.6 million which
was standing to the credit of the Company's share premium account) and to
apply such sums (less any part of the used by the Company as part of their
buyback programme) for the purposes of paying in full up to 30,000,000,000 B
Shares to be allotted and issued to Shareholders pro rata to their holdings of
Ordinary Shares at the Record Date in respect of the relevant issue of B
Shares.
3. Resolutions 3: Allotment and issue of B Shares
Resolution 3 (which is conditional on Resolutions 1 and 2 being passed) is
proposed as an ordinary resolution and authorises the Directors to allot and
issue B Shares from time to time up to an aggregate nominal amount of
€300,000,000 on a pro rata basis to Shareholders by way of one or more bonus
issues. If approved, this authority to allot and issue B Shares will. expire
at 23.59 hours on 8 January 2031.
The figure of 30,000,000,000 B Shares with a nominal value of one cent each,
for which authorisation is being sought for allotment and issue, will allow
for potential Return(s) of Capital using the new special distributable reserve
and for associated ratio calculations.
A copy of the New Articles and the Articles marked to show the changes will be
available during normal business hours (Saturdays, Sundays and public holidays
excepted) at the Company's registered office from the date of this document up
to and including close of business on 8 January 2026 and at the venue of the
General Meeting for at least 15 minutes prior to the start of the meeting and
up until the close of the meeting. A copy of the New Articles will also be
available for review on the Company's website at
(https://www.aquila-european-renewables.com) and submitted to the National
Storage Mechanism which is available for inspection at
https://data.fca.org.uk/a/nsm/nationalstoragemechanism.
Action to be taken
It is important to the Company that Shareholders have the opportunity to vote
even if they are unable to attend the General Meeting. Whether or not you
propose to attend the General Meeting in person, you are requested to complete
the Form of Proxy and submit it to the Registrar at Computershare Investor
Services PLC, The Pavilions, Bridgwater Road, Bristol BS99 6ZY, United Kingdom
so that it arrives no later than 1:00 p.m. on 6 January 2026.
If you hold your Ordinary Shares in CREST, you may appoint a proxy or proxies
by completing and transmitting a CREST Proxy Instruction using the procedures
described in the CREST Manual as soon as possible and so that the instruction
is received by no later than 1:00 p.m. on 6 January 2026.
As an alternative to completing and returning the accompanying Form of Proxy,
you may submit your proxy electronically by accessing the Registrar's online
voting portal at www.investorcentre.co.uk/eproxy. For security purposes, you
will be asked to enter the control number, your shareholder reference number
(SRN) and personal identification number (PIN) to validate the submission of
your proxy online. The control number and members' individual SRN and PIN
numbers are shown on the accompanying Form of Proxy. Proxies sent
electronically must be sent as soon as possible and, in any event, so as to be
received no later than 1:00 p.m. on 6 January 2026. In addition, institutional
investors may be able to appoint a proxy electronically via the Proxymity
platform (www.proxymity.io (http://www.proxymity.io) ). Proxies submitted via
a designated voting platform (such as CREST or Proxymity) for the General
Meeting must be transmitted so as to be received by the Registrar no later
than 48 hours (excluding weekends and any bank holiday) before the time of the
General Meeting.
The completion and submission of a Form of Proxy or the transmission of a
CREST Proxy Instruction will not affect your right to attend and vote in
person at the General Meeting if you wish.
Shareholders are reminded that, if their Ordinary Shares are held in the name
of a nominee, only that nominee or its duly appointed proxy can be counted in
the quorum at the General Meeting.
If you are in any doubt about the contents of this document or what action you
should take, you should consult your stockbroker, bank manager, solicitor or
other appropriate independent financial adviser who is authorised under the
FSMA if you are resident in the United Kingdom, or who is duly authorised
under the European Communities (Markets in Financial Instruments) Regulation
2017 (as amended) or Investment Intermediaries Act 1995 (as amended) if you
are resident in Ireland, or another appropriately authorised independent
financial adviser if you are resident in a territory outside Ireland or the
United Kingdom.
Costs of the managed wind down and the B shares
Fees charged to date in respect of the managed wind down are £2.61 million,
which include:
· legal fees of £1.79 million (covering managed wind-down and
business as usual matters);
· financial adviser fees of £250,000;
· data room fees of £280,000;
· power price curve £142,000; and
· consultancy fees of £141,000.
Additional fees to completion of the managed wind-down process are estimated
to be in the region of £3.76 million to £5.51 million, which include:
· legal fees in the region of £500,000 to £1.25 million
(accounting for a range of outcomes); and
· financial adviser fees of at least £3.25 million up to £4.25
million.
The costs of the Returns of Capital under the B Share Scheme include a broker
commission of 0.5 per cent of all amounts distributed, which, assuming an
amount equal to the Company's NAV as at 30 September 2025 is returned, equates
to £972,000.
Therefore, total costs of the managed wind-down and the B Share Scheme are
expected to be in the region of £7.2 million to £9.0 million, or 3.7 per
cent to 4.6 per cent of total distributions. If total distributions are lower,
then, as many of the costs are fixed, the costs as a proportion of the amounts
returned will increase.
All amounts above assume an exchange rate of €1.14 to £1.
RECOMMENDATION
The Board considers the passing of the Resolutions to be proposed at the
General Meeting, as set out in the Notice of General Meeting, to be in the
best interests of Shareholders as a whole. Accordingly, the Board unanimously
recommends that Shareholders vote in favour of the resolutions to be proposed
at the General Meeting, as the Directors intend to do in respect of their own
beneficial holdings, amounting to 225,000 Ordinary Shares, representing 0.06
per cent of the Ordinary Shares in issue (excluding the Company's treasury
shares amounting to 30,103,575) as at the date of this document.
In addition, Achilles Investment Company Limited, a company in which the Chair
is the lead fund manager, intends to vote in favour of the resolutions in
respect of their holdings, amounting to 5,110,000 Ordinary Shares in the
Company, representing 1.35 per cent of the Ordinary Shares in issue (excluding
the Company's treasury shares amounting to 30,103,575).
Yours faithfully
Robert Naylor
Chair
Part 2
DETAILS OF THE B SHARE SCHEME
1. CONDITIONS TO THE IMPLEMENTATION OF THE B SHARE SCHEME
The adoption and implementation of the B Share Scheme is conditional upon
Shareholder approval of the Resolutions at the General Meeting. The Notice of
General Meeting is set out at the end of this document and a summary
explanation of the Resolutions to be proposed at the General Meeting is set
out in paragraph 8 below. The action to be taken by Shareholders is also set
out on pages 9-10 of this document.
If the Resolutions are not passed by the requisite majorities of Shareholders,
then the Company will be unable to return surplus cash from time to time to
Shareholders by way of the B Share Scheme, although cash may still be returned
in other ways.
2. RETURN OF CAPITAL TO SHAREHOLDERS
A Return of Capital will involve the allotment and issue of B Shares to
Shareholders and the redemption of the B Shares by the Company. The quantum
and the timing of any Return(s) of Capital will be at the sole discretion of
the Board. Details of any Return of Capital, including the relevant Record
Date, Redemption Price and Redemption Date, will be announced through a
Regulatory Information Service.
The adoption of a B Share Scheme will not limit the ability of the Company to
return cash to Shareholders using other mechanisms and, if the B Share Scheme
is adopted, the Board will continue to review its tax effectiveness and cost
efficiency over time.
The Proposal to adopt a B Share Scheme at this point in time should not be
taken as any indication as to the frequency or quantum of any future returns
of cash to Shareholders.
3. ALLOTMENT AND ISSUE OF AND RIGHTS ATTACHING TO THE B
SHARES
For the purposes of making an issue of B Shares, it is proposed that the
Directors be authorised to capitalise from time-to-time amounts standing to
the credit of the Company's reserves available for the purpose of making a
bonus issue of shares in accordance with the Act and article 154 of the
Articles. These aggregate capitalised amounts will be used from time to time
to pay up, in full, B Shares with a nominal value of one cent each on the
basis that the aggregate nominal value of the B Shares so issued on each such
occasion will not exceed the aggregate sum or sums capitalised on each such
occasion for the purposes of such B Share issue. The aggregate maximum number
of B Shares that may be issued by the Company over time under the B Share
Scheme will not exceed 30,000,000,000 and the aggregate nominal value of all B
Shares issued will not exceed €300,000,000.
Under the New Articles and subject to the passing of Resolution 2, the
Directors may capitalise any sum standing to the credit of any reserve of the
Company (including, in particular, the Company's new special distributable
reserve) for the purposes of paying up, allotting and issuing B Shares to
Shareholders.
The B Shares will be allotted and issued to Shareholders pro rata to their
holdings of Ordinary Shares at the relevant Record Date for the issue of the B
Shares. The Company will not allot or issue any fractions of B Shares and
entitlements of each Shareholder will be rounded down to the nearest whole B
Share.
The B Shares will have only very limited rights. The rights and restrictions
to be attached to the B Shares are more fully set out in Part 3 of this
document.
No share certificates will be issued for any B Shares allotted and no CREST
accounts will be credited with any such shares.
No application will be made to (i) the Financial Conduct Authority or to the
London Stock Exchange for any of the B Shares to be admitted to the Official
List or to trading on the London Stock Exchange's main market for listed
securities or (ii) Euronext Group for any of the B Shares to be admitted to
trading on Euronext Growth, nor will any of the B Shares be listed or admitted
to trading on any other securities or investment exchange.
4. REDEMPTION OF B SHARES
Each redemption of B Shares will be undertaken at the sole discretion of the
Company. It is expected that redemption will occur shortly after each date of
allotment and issue of B Shares, when all of the B Shares then in issue will
be compulsorily redeemed and cancelled in accordance with their terms for an
amount not exceeding the amount treated as paid up on the B Shares.
Following the redemption and cancellation of the B Shares, the redemption
proceeds will be sent to Shareholders either through CREST to uncertificated
Shareholders or via cheque or electronic payment to certificated Shareholders.
As the B Share Dividend payment (if any) will be an income payment, it will be
paid separately either to mandated bank accounts or by cheque. The cash
received by Shareholders in connection with the B Share Scheme (to the extent
that the B Shares are issued as paid up out of amounts standing to the credit
of the Special Reserve), other than the very small B Share Dividend (if any),
should, under current legislation, be taxed as capital for UK individual
Shareholders. Please see Part 5 of this document for a summary guide to
certain potential tax consequences in the UK.
The UK tax treatment mentioned above refers only to B Shares to the extent
that they are issued as paid up out of amounts standing to the credit of the
Special Reserve. Any issue (and subsequent redemption) of B Shares issued as
paid up otherwise than out of amounts standing to the credit of the Special
Reserve may be subject to different tax treatment and, in particular, the
issue and redemption may give rise to an income distribution in the hands of
Shareholders for UK tax purposes.
5. OVERSEAS SHAREHOLDERS
Shareholders who are not resident in the United Kingdom or Ireland or who are
citizens, residents or nationals of other countries should consult their
professional advisers to ascertain whether the B Share Scheme (including, as
may be relevant in each case, the issue, holding or redemption of the B Shares
(which will be non-transferable)) will be subject to any restrictions or
require compliance with any formalities imposed by the laws or regulations of,
or any body or authority located in, the jurisdiction in which they are
resident or to which they are subject. In particular, it is the responsibility
of any Overseas Shareholder to satisfy themselves as to full observance of the
laws of each relevant jurisdiction in connection with the B Share Scheme,
including the obtaining of any government, exchange control or other consents
that may be required or the compliance with other necessary formalities
needing to be observed and the payment of any issue, transfer or other taxes
or duties in such jurisdiction.
The distribution of this document in certain jurisdictions other than the
United Kingdom or Ireland may be restricted by law. Persons into whose
possession this document 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.
Neither this document nor any other document issued or to be issued by or on
behalf of the Company in connection with the B Share Scheme constitutes an
invitation, offer or other action on the part of the Company in any
jurisdiction in which such invitation, offer or other action is unlawful.
The provisions of this paragraph 5 relating to Overseas Shareholders may be
waived, varied or modified as regards specific Overseas Shareholders or on a
general basis by the Company in its absolute discretion.
6. SECURITIES LAWS CONSIDERATIONS IN THE UNITED STATES
None of the B Shares will be registered under the US Securities Act or with
any state or other jurisdiction of the United States, and none of the B Shares
may be reoffered, resold, pledged, or otherwise transferred in or into the
United States or to any US persons except pursuant to a transaction that has
been registered under the US Securities Act and with the relevant state and
other jurisdictions or a transaction that is exempt from, or otherwise not
subject to, the securities laws of such jurisdictions.
7. AMENDMENTS TO THE ARTICLES OF ASSOCIATION
Amendments to the Articles are required in order to implement the B Share
Scheme and require approval at the General Meeting. Therefore it is proposed
that the Articles be amended by the adoption of the New Articles (pursuant to
Resolution 1) which include an insertion that contains the rights and
restrictions attaching to the B Shares, as set out in Part 3 of this document
together with a mechanism to allow the Directors to capitalise any sum or sums
standing to the credit of the Company's reserves from time to time for the
purposes of the B Share Scheme with the authority of an ordinary resolution of
Shareholders to be obtained on a one-off basis (being Resolution 2).
8. SUMMARY EXPLANATION OF THE RESOLUTIONS
Resolution 1 will be proposed at the General Meeting as a special resolution,
the passing of which requires at least 75 per cent. of the votes cast (whether
in person or by proxy) to be in favour.
Resolution 2 and Resolution 3 will each be proposed as ordinary resolutions,
the passing of which requires more than 50 per cent. of the votes cast
(whether in person or by proxy) to be in favour.
A summary of the Resolutions follows below:
Resolution 1 approves the adoption of New Articles with immediate effect
following the passing of that Resolution, which incorporate the rights and
restrictions to be attached to the B Shares (as set out in Part 3 of this
document).
Resolution 2 (which is conditional upon the passing of Resolution 1)
authorises the Directors to capitalise from time-to-time a sum or sums
standing to the credit of the Company's reserves available for the purpose of
making a new bonus issue of shares in accordance with the Act and the New
Articles, and to apply such sum or sums from time to time in paying up in full
up to 30,000,000,000 unlisted redeemable fixed rate preference shares of one
cent each in the capital of the Company carrying the rights and restrictions
set out in article 167 of the New Articles which may be allotted from time to
time pursuant to the authority given by Resolution 3.
Resolution 3 (which is conditional upon the passing of Resolutions 1 and 2)
authorises the Directors to allot and issue B Shares from time to time on a
pro rata basis as determined by the Directors from time to time up to an
aggregate nominal amount of €300,000,000. This authority to allot will
expire at 23.59 hours on 8 January 2031.
Part 3
RIGHTS AND RESTRICTIONS ATTACHED TO B SHARES
Set out below is the proposed insertion to the Articles, which contains the
rights and restrictions attached to the B Shares. The following Article 167 is
to be inserted into the New Articles together with the new defined terms as
set out herein. The Company is seeking Shareholder approval to adopt the New
Articles by way of a special resolution pursuant to Resolution 1.
B Ordinary Shares
167. Rights and restrictions attaching to B Shares.
General
167.1 Subject to the Companies Act and notwithstanding anything in these
Articles to the contrary:
167.1.1 the Directors may issue B Shares provided that
such B Shares are fully paid up out of the reserves of the Company; and
167.1.2 the Directors may, with the authority of an
ordinary resolution of the Company (which need only be obtained once and need
not be obtained on every occasion B Shares are to be issued unless the nominal
value and/or the rights attached to the B Shares were to be different in
respect of further issues of B Shares), from time to time resolve to
capitalise any sum or sums standing to the credit of any reserve of the
Company, whether or not the same is available for distribution, (including the
special reserve of the Company) and apply such sum or sums for the purposes of
paying up in full B Shares to be allotted and issued to shareholders pro rata
to their holdings of Ordinary Shares (excluding any Ordinary Shares held in
treasury at the relevant time or date) at such record time(s) and date(s) as
shall be determined by the Directors in respect of such allotments and issues
of B Shares, such pro rata basis to be determined by the Directors. No
fractions of B Shares will be issued and entitlements will be rounded down to
the nearest whole B Share. Where any difficulty arises with regard to the
capitalisation of any such sum or sums the Directors may settle the matter as
they think expedient and in particular may resolve that the issue of B Shares
should be as nearly as may be practicable pro rata but not exactly so and may
determine that cash payments shall be made to any members in order to adjust
the rights of all parties as may seem expedient to the Directors, and may
authorise any person to sell and transfer any fractions of B Shares.
167.2 Notwithstanding any other provisions in these Articles, the B
Shares shall have the rights, and be subject to the restrictions, attaching to
shares set out in these Articles save that in the event of a conflict between
any provision in this Article 167 and any other provision in these Articles,
the provisions in this Article 167 shall prevail.
Income
167.3 The Company's profits available for distribution shall be applied
first in paying to the holders of the B Shares (in priority to any payment of
dividend to the holders of any other class of shares in the capital of the
Company) a fixed rate cumulative preferential cash dividend ("Preferential
Dividend") at the rate of 0.01 per cent. per annum on the nominal value of one
cent on every B Share held by them, such dividend to be paid annually on the
date falling six months after the date on which any B Shares are issued and
thereafter on each anniversary of such date ("Fixed Dividend Dates") to the
registered holders of B Shares shown in the Register on the relevant Fixed
Dividend Date. Every Preferential Dividend shall be distributed to the holders
of the B Shares pro rata according to the amounts paid up or credited as paid
up on the B Shares held by them respectively and shall be rounded to the
nearest whole cent.
Capital
167.4 Except as provided in Article 167.12 below, on a return of capital
on a winding-up (excluding any intra-group reorganisation on a solvent basis),
the holders of the B Shares shall be entitled, in priority to any payment to
the holders of every other class of share in the capital of the Company, to
one cent per B Share held by them.
167.5 On a winding up, the holders of the B Shares shall not be entitled
to any further right of participation in the profits or assets of the Company
in excess of that specified in Article 167.4 above. In the event that there is
a winding-up to which Article 167.4 applies and the amounts available for
payment are insufficient to pay the amounts due on all the B Shares in full,
the holders of the B Shares shall be entitled to their pro rata proportion of
the amounts to which they would otherwise be entitled.
167.6 The aggregate entitlement of each holder of B Shares on a
winding-up in respect of all the B Shares held by him shall be rounded down to
the nearest whole cent.
167.7 The holders of the B Shares shall not be entitled to any further
right of participation in the profits or assets of the Company in their
capacity as holders of B Shares.
Attendance and voting at general meetings
167.8 The holders of the B Shares shall not be entitled, in their
capacity as holders of such B Shares, to receive notice of any general meeting
of the Company nor to attend, speak or vote at any such general meeting.
Class rights
167.9 The Company may from time to time create, allot and issue further
shares, whether ranking pari passu with or in priority or subsequent to the B
Shares. The creation, allotment or issue of any such further shares (whether
or not ranking in any respect in priority to the B Shares) shall be treated as
being in accordance with the rights attaching to the B Shares and shall not
involve a variation of such rights for any purpose or require the consent of
the holders of the B Shares.
167.10 A reduction by the Company of the capital paid up or credited as paid
up on the B Shares and the cancellation of such shares shall be treated as
being in accordance with the rights attaching to the B Shares and shall not
involve a variation of such rights for any purpose or require the consent of
the holders of the B Shares.
167.11 Without prejudice to the generality of the foregoing, the Company is
authorised to reduce (or purchase shares in) its capital of any class or
classes and such redemption (or purchase) shall not involve a variation of any
rights attaching to the B Shares for any purpose or require the consent of the
holders of the B Shares.
Redemption of B Shares
167.12 Subject to the provisions of the Companies Act and these Articles, the
Company shall redeem the B Shares as follows:
167.12.1 The B Shares shall be redeemed at such time or
times as the Directors may in their absolute discretion determine (each a
"Redemption Time"). There shall be paid on each B Share redeemed under this
Article 167.12 the amount paid up thereon together with a sum equal to all
arrears of any Preferential Dividend due and payable at any time prior to the
Redemption Time.
167.12.2 As from the Redemption Time, no Preferential
Dividends shall be payable on the B Shares.
167.12.3 In the absence of bad faith or wilful default,
neither the Company nor any of its Directors, officers or employees shall have
any liability to any person for any loss or damage arising as a result of the
determination of the Redemption Time in accordance with Article 167.12.1
above.
167.12.4 The receipt of the registered holder for the
time being of any B Shares (or in the case of joint registered holders the
receipt of any of them) of the monies payable on the redemption thereof shall
constitute an absolute discharge to the Company in respect thereof.
Transfer
167.13 The B Shares shall not be transferable.
Share certificates
167.14 The B Shares shall not be listed or admitted to trading on any stock
exchange nor shall any share certificates be issued in respect of the B
Shares.
Definitions
167.15 For the purposes of this Article 167, the following terms have the
meanings given below:
B Shares unlisted, redeemable, fixed
rate preference shares of one cent each in the capital of the Company
Fixed Dividend Dates has the meaning given to it in Article 167.3;
Preferential Dividend has the meaning given to it in Article 167.3; and
Redemption Time has the meaning given to it in Article
167.12.1.
Part 4
RISKS ASSOCIATED WITH THE PROPOSAL
In considering how to vote on the Resolutions in relation to the Proposal, you
are referred to the risks set out below.
Shareholders should read this document carefully and in its entirety and, if
you are in any doubt about the contents of this document or the action you
should take, you are recommended to immediately seek your own personal
financial advice from your stockbroker, bank manager, solicitor, accountant or
other independent financial adviser authorised under the Financial Services
and Markets Act 2000 or who is duly authorised under the European Communities
(Markets in Financial Instruments) Regulation 2017 (as amended) or Investment
Intermediaries Act 1995 (as amended) if you are resident in Ireland, or
another appropriately authorised independent financial adviser if you are
resident in a territory outside Ireland or the United Kingdom
Risks related to the B Share Scheme and any Return(s) of Capital
Shareholders should be aware of the following risks associated with the B
Share Scheme and any Return(s) of Capital.
· There is no guarantee that the B Share Scheme or any Return of
Capital pursuant to the B Share Scheme will take place. The B Share Scheme is
conditional on, among other things, the approval of Shareholders and will not
proceed if the Resolutions are not passed. The approval of Resolution 1
requires not less than 75 per cent. of those voting at the General Meeting in
person or by proxy to vote in favour of the Resolution. Resolutions 2 and 3
require more than 50 per cent. of those voting at the General Meeting in
person or by proxy to vote in favour. It is possible that Shareholders may not
approve the Resolutions. If the Resolutions are not passed there will be no
Return(s) of Capital under the B Share Scheme and the Board will need to
consider alternative options to return capital to Shareholders which will
involve additional time and cost.
· The amount of cash that the Company will be able to return to
Shareholders in the future and the timing of any such returns will depend,
amongst other things, on the performance of the Company's remaining assets and
the proceeds realised following a disposal of such assets and the timing of
such realisations. The quantum and timing of any Return(s) of Capital to
Shareholders under the B Share Scheme (if any) will also be at the discretion
of the Board and will also be dependent on completion of disposals of the
remaining assets, general working capital requirements and the amount and
nature (from a tax perspective) of the Company's distributable reserves from
time to time.
· Even if the Resolutions are passed, the Board may determine, at
its absolute discretion, not to make any Return of Capital pursuant to the B
Share Scheme.
· The Board has been advised that based on the facts, the B Share
Scheme should result in UK individual taxpayers receiving their cash proceeds
on redemption of B Shares as capital in the way described in this document(to
the extent that the B Shares are issued as paid up out of amounts standing to
the credit of the Special Reserve). However, there is no guarantee that this
position will be accepted and not challenged by HMRC and should Shareholders
who are UK individual tax payers fail to receive the capital treatment
described in this document they will be subject to income tax on the cash
proceeds on the redemption of the B Shares at the rates set out in the
"Taxation of Dividends" section in Part 5 of this document.
Risks related to the managed wind-down of the Company
· The Company's business, financial condition or results could be
materially and adversely affected by any of the risks described below. In such
cases, the market price of the Ordinary Shares may decline because of any of
these risks and Shareholders may lose all or part of their investment.
Additional risks and uncertainties not presently known to the Directors, or
that the Directors currently deem immaterial, may also have an adverse effect
on the Company. The Directors consider the following to be the material known
risks specific to the Company, but the risks listed do not necessarily
comprise all those associated with the Company: In a managed wind down, the
value of the Company's portfolio will be reduced as investments are realised
and concentrated in fewer holdings.
· The Company might experience increased volatility in its Net
Asset Value and/or its share price as a result of the wind down of its
portfolio.
· The Company's assets may not be realised at their carrying value,
and it is possible that the Company may not be able to realise some of its
assets in a timely manner.
· An orderly wind-down is reliant on a willingness to transact from
potential buyers, confirmation that they have funding sources available and
the completion of due diligence/relevant legal documentation.
· Pursuing the managed wind-down including (i) finding potential
buyers, (ii) negotiating the terms of sale of an asset with potential buyers
and (iii) returning capital to Shareholders requires significant time
commitment from the Company and its advisers and generates significant
transaction costs to be borne by the Company.
· As the assets of the Company are sold, the Company's portfolio
will become less diversified and the Company will be more exposed to
concentration risk.
· As is customary, any terms of sale of the Company's assets may
contain various obligations from the seller in favour of the purchaser. The
Company shall take appropriate steps to minimise the risk of liability under
these provisions. However, any liability to make a payment arising from a
successful claim by the purchaser under these provisions could have an adverse
effect on its business, financial condition and results of operations.
Furthermore, the Company may need to withhold some of the proceeds from the
sale during the relevant claim period to provision for any potential claim
being made by a relevant purchaser.
· As cash is progressively returned to Shareholders, the net assets
of the Company will progressively reduce. The Company's annual running costs
and liabilities will not necessarily reduce by the same proportion and
consequently the costs as a percentage of net assets may increase. This may
restrict, in terms of both quantum and timing, the Company's ability to make
dividend payments and/or return capital to Shareholders following receipt of
the net proceeds of realisations of investments.
· Although the Ordinary Shares are admitted to trading on the
London Stock Exchange's main market for listed securities and admitted to
trading on Euronext Growth, it may prove difficult for Shareholders to sell
their Ordinary Shares in the market. In addition, there is no guarantee that
the market price of the Ordinary Shares will reflect their underlying Net
Asset Value or the ability to buy and sell at that price.
Part 5
UNITED KINGDOM TAXATION
United Kingdom taxation
The following summary does not constitute tax advice and is intended only as a
general guide to current UK law and HMRC published practice (which are both
subject to change at any time, possibly with retrospective effect, and the
latter of which is not necessarily enforceable). It relates only to certain
limited aspects of the UK taxation treatment of Shareholders and is intended
to apply only to Shareholders who are solely resident in the UK (other than
Scotland) for UK tax purposes and who are, and will be, the absolute
beneficial owners of their Ordinary Shares and B Shares and who hold, and will
hold, them as investments (and not as securities to be realised in the course
of a trade) other than on a tax exempt basis (e.g. through an Investment
Savings Account (ISA)). The summary may not apply to certain Shareholders,
such as, but not limited to, dealers in securities, insurance companies,
collective investment schemes, Shareholders who are exempt from taxation,
Shareholders who have or are deemed to have acquired their Ordinary Shares or
B Shares by reason of their or another's employment, Shareholders who hold
their Ordinary Shares or B Shares as part of hedging or conversion
transactions, or Shareholders who hold their Ordinary Shares or B Shares in
connection with a UK branch, agency or permanent establishment. The position
may be different for future transactions and may alter between the date of
this document and the implementation of the B Share Scheme.
Shareholders who are in any doubt as to their tax position or who are subject
to tax in Scotland or a jurisdiction other than the UK should consult an
appropriate professional adviser.
Issue of B Shares
For the purposes of the taxation of chargeable gains, the issue of B Shares
(to the extent that they are issued as paid up out of amounts standing to the
credit of the Special Reserve) should constitute a reorganisation of the share
capital of the Company. Accordingly, the B Shares should be treated as the
same asset as a Shareholder's holding of existing Ordinary Shares, and as
having been acquired at the same time as a Shareholder's holding of existing
Ordinary Shares was acquired. A Shareholder's combined holding of Ordinary
Shares and B Shares should have the same aggregate base cost as the
Shareholder's holding of Ordinary Shares immediately before the issue of B
Shares. The aggregate base cost should be apportioned between B Shares and the
Ordinary Shares held by a Shareholder by reference to the market values of the
Ordinary Shares and the B Shares on the first day of trading after the issue
of B Shares. Due to the terms on which the B Shares will be issued, and as
they are nontransferable, their market value is likely to be equal to their
nominal value of one cent. The apportionment ratio between B Shares and
Ordinary Shares in relation to each B Share issue will be published on the
Company's website (https://www.aquila-european-renewables.com) at the earliest
practicable time following a quotation or publication of a price or market
valuation in respect of the Ordinary Shares following an issue of B Shares.
The issue of B Shares (to the extent that they are issued as paid up out of
amounts standing to the credit of the Special Reserve) should not give rise to
any liability to UK income tax or corporation tax in a Shareholder's hands.
The UK tax treatment described above refers only to B Shares to the extent
that they are issued as paid up out of the Special Reserve. Any issue (and
subsequent redemption) of B Shares issued as paid up otherwise than out of the
Special Reserve may be subject to different tax treatment and, in particular,
the issue and redemption may give rise to an income distribution in the hands
of Shareholders for UK tax purposes.
Redemption of the B Shares
On the redemption of all or any of the B Shares (to the extent that they have
been issued as paid up out of amounts standing to the credit of the Special
Reserve), an individual Shareholder may, depending on their individual
circumstances, be subject to capital gains tax on the amount of any chargeable
gain realised. Any gain will be measured by reference to the excess of the
redemption price above a Shareholder's tax base cost for the B Shares
redeemed. A Shareholder's allowable expenditure in relation to their existing
Ordinary Shares should be apportioned between the Ordinary Shares and the B
Shares in the manner described above.
The amount of capital gains tax, if any, payable by an individual Shareholder
in relation to the chargeable gain will depend on their personal tax position.
As at the date of this document, no tax should be payable on any gain realised
on the redemption if the amount of the net chargeable gain, when aggregated
with other net chargeable gains realised by the individual Shareholder in the
year of assessment in question and allowable losses, does not exceed the
annual exemption for UK CGT purposes (£3,000 for the tax year ended 5 April
2026). Broadly, any gains in excess of this amount will be taxed at the
individual's relevant UK capital gains tax rate. The gain will be taxable at
18 per cent. if the individual is a UK resident and a basic rate income
taxpayer only. If the gain exceeds the unused part of an individual's basic
rate band for income tax the gain will be taxed at 18 per cent. to the extent
of the unused element and 24 per cent. for the excess.
If a UK tax resident individual is subject to income tax at a rate in excess
of the basic rate then the chargeable gain will be taxable at 24 per cent.
As B Shares issued under the B Share Scheme will not be listed or admitted to
trading on a securities or investment exchange, they will not be eligible for
inclusion in an ISA.
Redemptions will be recognised for CGT purposes in the tax year in which they
occur.
Redemption payments made to Shareholders within the charge to UK corporation
tax will be treated as distributions for tax purposes and should generally not
give rise to any charge to corporation tax.
The Finance Act 2015 enacted legislation which, broadly, treats amounts paid
on the redemption of shares as income in the hands of an individual
Shareholder, rather than a capital gain, where a company gives the shareholder
a choice of whether to receive either a distribution or an "alternative
receipt" of broadly the same value but which is not charged to income tax. The
Company is of the view that this legislation does not apply to the redemption
of the B Shares on the basis that it does not provide Shareholders with a
choice as to the form of any amounts they are entitled to receive.
Accordingly, the proceeds received by a Shareholder on a redemption of B
Shares for an amount equal to their nominal value should not be prevented by
virtue of this legislation from being a return of capital in the Shareholder's
hands.
The UK tax treatment described above refers only to B Shares to the extent
that they are issued as paid up out of the Special Reserve. Any issue (and
subsequent redemption) of B Shares issued as paid up otherwise than out of the
Special Reserve may be subject to different tax treatment and, in particular,
the issue and redemption may give rise to an income distribution in the hands
of Shareholders for UK tax purposes.
Taxation of Dividends
The Company is not required to withhold tax at source from dividend payments
that it makes.
Individual Shareholders
Shareholders who are individuals and who receive a dividend from the Company
will, in principle, be liable to UK income tax on the amount of that dividend,
depending on the amount of dividend income received in total by (and other
taxable income of) that Shareholder (whether from the Company or other
sources) in the relevant tax year.
Individual Shareholders will not currently be liable to UK income tax in
respect of a dividend from the Company if the Shareholder's total dividend
income from any source in the relevant tax year does not exceed £500. In the
case of an individual Shareholder who receives dividends in excess of £500 in
a tax year, the excess amount of any such dividends will be subject to UK tax
at 8.75 per cent. for basic rate and non-taxpayers, 33.75 per cent. for higher
rate taxpayers and 39.35 per cent. for additional rate taxpayers. In practice,
given the very short period of time for which the B Shares will be in issue, B
Share Dividends are unlikely to become payable.
Corporate Shareholders
A Shareholder within the charge to UK corporation tax which is a 'small
company' (for the purposes of the UK taxation of dividends) will not generally
be subject to tax on dividends from the Company.
Other Shareholders within the charge to UK corporation tax will not be subject
to tax on dividends from the Company so long as the dividends fall within an
exempt class and do not fall within certain specified anti-avoidance
provisions and the Shareholder has not elected for the dividends not to be
exempt. It is expected that any dividends paid by the Company on the B Shares
would fall within an exempt class.
Stamp Duty and Stamp Duty Reserve Tax ("SDRT")
No stamp duty or SDRT will be payable by Shareholders on the allotment and
issue of any B Shares or the redemption of any B Shares (since redemptions
will take place under the New Articles of Association and not under Section
690 Companies Act 2006).
Transactions in Securities
Under the provisions of Part 15 of the Corporation Tax Act 2010, HMRC can in
certain circumstances counteract tax advantages arising in relation to a
transaction or transactions in securities. If these provisions were to be
applied by HMRC to the proposed B Share Scheme, in broad terms, individual
Shareholders might be liable to taxation as if they had received an income
amount rather than a capital amount. However, these provisions only apply in
the case of close company transactions. The Directors do not consider that the
Company is a close company, and consequently these provisions should not be
relevant.
NOTICE OF GENERAL MEETING
Aquila European Renewables plc
(Incorporated in England and Wales with registered number 11932433)
(Registered as an investment company under section 833 of the Companies Act
2006)
Notice is hereby given that the General Meeting of Aquila European Renewables
plc will be held at the offices of CMS Cameron McKenna Nabarro Olswang LLP, at
Cannon Place, 78 Cannon Street, London, EC4N 6AF, United Kingdom on 8 January
2026 at 1.00 p.m. for the following purposes:
To consider and, if thought fit, pass the following resolutions of which
resolution 1 will be proposed as a special resolution and resolutions 2 and 3
will each be proposed as ordinary resolutions.
Special Resolution
1. That the draft articles of association produced to the meeting and
initialled by the chairman of the meeting be approved and adopted as the
articles of association of the Company in substitution for, and to the
exclusion of, all existing articles of association of the Company to take
effect immediately.
Ordinary Resolutions
2. That, conditional upon the passing of resolution 1 above, the directors
of the Company be generally and unconditionally authorised pursuant to article
154 of the articles of association of the Company to capitalise from time to
time any sum or sums standing to the credit of any reserve of the Company,
whether or not the same is available for distribution, (including the
Company's special reserve) and to apply such sum or sums in paying up in full
up to 30,000,000,000 unlisted, redeemable, fixed rate preference Ordinary
Shares of one cent each in the capital of the Company having the rights and
restrictions set out in article 154 of the articles of association of the
Company ("B Shares") that may be allotted and issued from time to time to the
holders of Ordinary Shares in the capital of the Company pursuant to the
authority given by resolution 3 below.
3. That, conditional upon the passing of resolutions 1 and 2 above,
pursuant to section 551 of the Companies Act 2006, the directors of the
Company ("Directors") be generally and unconditionally authorised to exercise
all powers of the Company to allot and issue from time to time, credited as
fully paid up B Shares up to an aggregate nominal amount of €300,000,000
to the holders of Ordinary Shares in the capital of the Company (excluding any
Ordinary Shares held in treasury) on a pro rata basis, and by reference to
such record time(s) and date(s), as determined by the Directors from time to
time, in accordance with the terms of the circular sent by the Company to its
shareholders dated 15 December 2025. Unless previously varied, revoked or
renewed, this authority shall expire at 23.59 hours on 8 January 2031, save
that the Company may, before such expiry, make an offer or agreement which
would or might require B Shares to be allotted and/or issued after such expiry
and the Directors may allot and issue B Shares in pursuance of any such offer
or agreement as if the authority conferred hereby had not expired.
By order of the Board
Grace Goudar Registered Office
for Apex Listed Companies Services (UK) Limited 4(th) Floor
Company Secretary 140 Aldersgate Street
London
EC1A 4HY
15 December 2025 United Kingdom
Notes to the Notice of the General Meeting
1. Holders of Ordinary Shares are entitled to attend, speak and
vote at the General Meeting. A Shareholder entitled to attend, speak and vote
at the General Meeting may appoint one or more persons as his/her proxy to
attend, speak and vote on his/her behalf at the General Meeting. A proxy need
not be a Shareholder of the Company. However, in order for their vote to
count, Shareholders are strongly encouraged to appoint the Chair of the
meeting as their proxy. Shareholders are advised to return the form of proxy
irrespective of whether they are expecting to attend the General Meeting. If
multiple proxies are appointed, they must not be appointed in respect of the
same Ordinary Shares. To be effective, the enclosed form of proxy ("Form of
Proxy"), together with any power of attorney or other authority under which it
is signed or a certified copy thereof, should be lodged at the office of the
Company's Registrar, Computershare Investor Services PLC, The Pavilions,
Bridgwater Road, Bristol, BS99 6ZY, United Kingdom by no later than 1.00 p.m.
on 6 January 2026.
2. If you return more than one proxy appointment, either by paper
or electronic communication, in respect of the same Ordinary Shares, the Form
of Proxy validly received last by the Registrar before the latest time for the
receipt of proxies will take precedence. You are advised to read the terms and
conditions of use carefully. Electronic communication facilities are open to
all Shareholders and those who use them will not be disadvantaged.
3. As an alternative to completing the Form of Proxy, Shareholders
can appoint a proxy electronically via the Registrar's online voting portal at
www.investorcentre.co.uk/eproxy. For an electronic proxy appointment to be
valid, your appointment must be received by the Registrar no later than 1.00
p.m. on 6 January 2026. Shareholders are strongly encouraged to appoint the
Chair of the General Meeting as their proxy to vote on their behalf.
4. If you are an institutional investor you may be able to appoint
a proxy electronically via the Proxymity platform, a process which has been
agreed by the Company and approved by the Registrar. For further information
regarding Proxymity, please go to www.proxymity.io. Your proxy must be lodged
by 1.00 p.m. on 6 January 2026 in order to be considered valid. Before you can
appoint a proxy via this process you will need to have agreed to Proxymity's
associated terms and conditions. It is important that you read these carefully
as you will be bound by them and they will govern the electronic appointment
of your proxy.
5. The appointment of a proxy will not prevent a Shareholder from
attending the General Meeting, speaking and voting in person if he/she so
wishes. The termination of the authority of a person to act as proxy must be
notified to the Company in writing by no later than 1.00 p.m. on 6 January
2026. Amended instructions must be received by the Registrar by the deadline
for receipt of proxies. Where you have appointed a proxy using the Form of
Proxy and would like to change the instructions using another hard-copy Form
of Proxy, please contact the Registrar's helpline on 0370 703 0020 (or +44 370
703 0020 from outside the UK). Lines are open 8.30 a.m. to 5.30 p.m. Monday to
Friday (excluding public holidays in England and Wales).
6. Voting on all of the proposed resolutions at the General
Meeting will be conducted on a poll rather than on a show of hands in
accordance with the Company's articles of association.
7. To appoint more than one proxy, Shareholders will need to
complete a separate Form of Proxy in relation to each appointment, stating
clearly on each Form of Proxy the number of Ordinary Shares in relation to
which the proxy is appointed. A failure to specify the number of Ordinary
Shares to which each proxy appointment relates or specifying an aggregate
number of Ordinary Shares in excess of those held by the Shareholder will
result in the proxy appointment being invalid. Please indicate if the proxy
instruction is one of multiple instructions being given. If you require
additional Forms of Proxy, please contact the Registrar's helpline on 0370 703
0020 (or +44 370 703 0020 from outside the UK). Lines are open 8.30 a.m. to
5.30 p.m. Monday to Friday (excluding public holidays in England and Wales).
All Forms of Proxy must be signed and should be returned together in the same
envelope if possible.
8. In the case of joint holders, where more than one of the joint
holders purports to appoint a proxy, only the appointment submitted by the
most senior holder will be accepted. Seniority is determined by the order in
which the names of the joint holders appear in the Company's register of
members in respect of the joint holders (the first named being the most
senior).
9. Only those Shareholders registered in the register of members
of the Company as at 6.30 p.m. on 6 January 2026 (the "specified time") shall
be entitled to vote at the General Meeting in respect of the number of
Ordinary Shares registered in their name at that time. Changes to entries on
the relevant register of securities after 6.30 p.m. on 6 January 2026 shall be
disregarded in determining the rights of any person to vote at the General
Meeting. If the General Meeting is adjourned to a time not more than 48 hours
after the specified time applicable to the original meeting, that time will
also apply for the purpose of determining the entitlement of Shareholders to
vote (and for the purpose of determining the number of votes they may cast) at
the adjourned meeting. If however the General Meeting is adjourned for a
longer period then, to be so entitled, Shareholders must be entered on the
Company's register of members at the time which is 48 hours before the time
fixed for the adjourned meeting, or if the Company gives notice of the
adjourned meeting, at the time specified in that notice.
10. Shareholders who hold their Shares electronically may submit their
votes through CREST. Instructions on how to vote through CREST can be found by
accessing the following website: www.euroclear.com.
11. CREST members who wish to appoint a proxy or proxies by utilising
the CREST electronic proxy appointment service may do so for the General
Meeting and any adjournment(s) thereof by following the procedures described
in the CREST manual (available via www.euroclear.com). CREST personal members
or other CREST sponsored members, and those CREST members who have appointed a
voting service provider(s), should refer to their CREST sponsor or voting
service provider(s), who will be able to take the appropriate action on their
behalf.
12. In order for a proxy appointment or instruction made by means of
CREST to be valid, the appropriate CREST message (a "CREST Proxy Instruction")
must be properly authenticated in accordance with Euroclear's specifications
and must contain the information required for such instructions, as described
in the CREST manual (available via www.euroclear.com). The message, in order
to be valid, must be transmitted so as to be received by them the Company's
agent ID, 3RA50 by the latest time for receipt of proxy appointments specified
in note 1 above. For this purpose, the time of receipt will be taken to be the
time (as determined by the timestamp applied to the message by the CREST
Applications Host) from which the Company's agent is able to retrieve the
message by enquiry to CREST in the manner prescribed by CREST. After this
time, any change of instructions to proxies appointed through CREST should be
communicated to the appointee through other means.
13. CREST members and, where applicable, their CREST sponsors or
voting service providers should note that Euroclear does not make available
special procedures in CREST for any particular messages. Normal system timings
and limitations will therefore apply in relation to the input of CREST Proxy
Instructions. It is the responsibility of the CREST member concerned to take
(or, if the CREST member is a CREST personal member or sponsored member or has
appointed a voting service provider(s), to procure that his/her CREST sponsor
or voting service provider(s) take(s)) such action as shall be necessary to
ensure that a message is transmitted by means of the CREST system by any
particular time.
14. In this connection, CREST members and, where applicable, their
CREST sponsors or voting service providers are referred, in particular, to
those sections of the CREST manual concerning practical limitations of the
CREST system and timings.
15. The Company may treat as invalid a CREST Proxy Instruction in the
circumstances set out in Regulation 35(5) (a) of the Uncertificated Securities
Regulations 2001.
16. A person to whom this Notice of General Meeting is sent who is a
person nominated under section 146 of the Companies Act 2006 to enjoy
information rights (a "Nominated Person") may, under an agreement between
him/her and the Shareholder by whom he/ she was nominated, have a right to be
appointed (or to have someone else appointed) as a proxy for the General
Meeting. If a Nominated Person has no such proxy appointment right or does not
wish to exercise it, he/she may, under any such agreement, have a right to
give instructions to the Shareholder as to the exercise of voting rights. The
statements of the rights of members in relation to the appointment of proxies
in note 1 above do not apply to a Nominated Person. The rights described in
those notes can only be exercised by registered Shareholders of the Company.
17. Nominated Persons are reminded that their main point of contact in
terms of their investment in the Company remains the member who nominated the
Nominated Person to enjoy information rights (or, as applicable, the custodian
or broker who administers the investment on their behalf). Nominated Persons
should continue to contact that member, custodian or broker (and not the
Company) regarding any changes or queries relating to the Nominated Person's
personal details and interest in the Company (including any administrative
matter). The only exception to this is where the Company expressly requests a
response from a Nominated Person.
18. As at 12 December 2025 (being the latest practicable date prior to
the date of this Notice of General Meeting), the Company's issued share
capital amounted to 408,225,705 Ordinary Shares carrying one vote each.
30,103,575 Ordinary Shares were held in treasury. Therefore, the total voting
rights of the Company as at the date of this Notice of General Meeting were
378,122,130.
19. Any corporation which is a Shareholder may appoint one or more
corporate representatives who may exercise on its behalf all of its powers as
a Shareholder, provided that they do not do so in relation to the same
Ordinary Shares. However, before deciding to elect to appoint a corporate
representative, corporate Shareholders may also appoint one or more proxies in
accordance with note 1.
20. Any question relevant to the business of the General Meeting may
be asked at the meeting by anyone permitted to speak at the meeting or can be
submitted in advance by email to aquilacosecmailbox@apexgroup.com
(mailto:aquilacosecmailbox@apexgroup.com) by 1.00 p.m. on 6 January 2026. The
Company must answer any questions asked by a Shareholder relating to the
business being dealt with at the meeting unless:
(a) answering the question would interfere unduly with the
preparation for the meeting or involve the disclosure of confidential
information;
(b) the answer has already been given on a website in the form of an
answer to a question; or
(c) it is undesirable in the interests of the Company or the good
order of the meeting that the question be answered.
21. Any person holding 3% or more of the total voting rights of the
Company who appoints a person other than the Chair of the meeting as his/her
proxy is to ensure that both he/she and his/her proxy comply with their
respective disclosure obligations under the Disclosure Guidance and
Transparency Rules. Shareholders are directed to the guidance on voting by
proxy set out in these Notes.
22. This Notice of General Meeting, the information required by
section 311A of the Companies Act 2006 and, if applicable, any members'
statements, members' resolutions or members' matters of business received by
the Company after the date of this Notice of General Meeting, will be
available on the Company's website at
https://www.aquila-european-renewables.com.
23. Shareholders may not use any electronic address provided either in
the Notice of General Meeting or any related documents (including the Form of
Proxy) to communicate with the Company for any purpose other than those
expressly stated.
DEFINITIONS
In this document, unless context otherwise requires, the following expressions
bear the following meanings:
Act the Companies Act 2006, as amended from time to time;
Aquila Capital Aquila Capital Investmentgesellschaft mbH;
Articles or Articles of Association the current articles of association of the Company, as adopted by a special
resolution of the Company passed on 29 April 2019;
Board the board of Directors of the Company (or any duly authorised committee
thereof);
B Share Dividend the fixed rate dividend payable on B Shares in accordance with the rights
described in Part 3 of this document;
B Shares unlisted, redeemable, fixed rate preference shares of one cent each in the
capital of the Company having the rights and restrictions set out in Part 3 of
this document;
B Share Scheme the proposed mechanism to enable returns of capital through the issue and
redemption of B Shares;
CGT United Kingdom taxation of capital gains and corporation tax on chargeable
gains;
Company Aquila European Renewables plc;
CREST the relevant system (as defined in the Uncertificated Securities Regulations
2001 (SI 2001 No. 3755)) for the paperless settlement of transfers and the
holding of shares in uncertificated form which is administered by Euroclear;
CREST Manual the compendium of documents titled 'CREST Manual' issued by Euroclear from
time to time and comprising the CREST Reference Manual, the CREST Central
Counterparty Service Manual, the CREST International Manual, CREST Rules, CCSS
Operations Manual and the CREST Glossary of Terms;
CREST Proxy Instruction an authenticated CREST message to appoint or instruct a proxy in accordance
with Euroclear's specifications and the CREST Manual;
Directors the directors of the Company from time to time;
Disclosure Guidance and Transparency Rules the UK disclosure guidance and transparency rules sourcebook made by the FCA
under Part VI of FSMA;
Euroclear Euroclear UK & International Limited;
FCA or Financial Conduct Authority the Financial Conduct Authority;
Form of Proxy the form of proxy for use by Shareholders in connection with the General
Meeting which accompanies this document;
FSMA the Financial Services and Markets Act 2000, as amended, including any
regulations made pursuant thereto;
General Meeting the general meeting of the Company convened for 1.00 p.m. on 8 January 2026 to
be held at Cannon Place, 78 Cannon Street, London, EC4N 6AF, or any
adjournment of that meeting, the notice for which is set out at the end of
this document ("Notice of General Meeting");
HMRC HM Revenue & Customs;
London Stock Exchange London Stock Exchange plc;
Net Asset Value the value of the assets of the Company less its liabilities, determined in
accordance with the accounting principles adopted by the Company from time to
time;
New Articles the new articles of association of the Company proposed to be adopted by
Shareholders at the General Meeting pursuant to Resolution 1;
Official List the Official List of the FCA;
Ordinary Shares ordinary shares of €0.01 each in the capital of the Company;
Overseas Shareholders Shareholders resident in, or citizens or nationals of, jurisdictions outside
the United Kingdom;
Proposal the proposed adoption and implementation of the B Share Scheme by the Company
on the terms set out in this document;
Record Date in respect of any Return of Capital, the date determined by the Board, at its
absolute discretion, on which Shareholders' entitlements to B Shares under
that Return of Capital will be calculated;
Redemption Date in respect of any Return of Capital, the date determined by the Board, at its
absolute discretion, on which the B Shares allotted and issued under that
Return of Capital will be redeemed;
Redemption Price in respect of any Return of Capital, the price at which B Shares allotted and
issued under that Return of Capital are to be redeemed, being one cent for
each B Share;
Registrar Computershare Investor Services plc;
Regulatory Information Service the regulatory information service provided by the London Stock Exchange;
Resolution 1 resolution number 1 to be put to the General Meeting as set out in the Notice
of General Meeting;
Resolution 2 resolution number 2 to be put to the General Meeting as set out in the Notice
of General Meeting;
Resolution 3 resolution number 3 to be put to the General Meeting as set out in the Notice
of General Meeting;
Resolutions Resolution 1, Resolution 2 and Resolution 3, or each of them as the context
may require;
Return of Capital a return of capital pursuant to the allotment, issue and redemption of B
Shares to be made at such time or times as determined by the Board at its
absolute discretion;
Shareholders holders of Ordinary Shares;
UK or United Kingdom the United Kingdom of Great Britain and Northern Ireland;
US or United States the United States of America, its territories and possessions, any state of
the United States of America and the District of Columbia; and
US Securities Act the United States Securities Act of 1933, as amended from time to time.
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