REG-BH Macro Limited: Proposed combination with BH Global Limited

BH MacroAnnouncement

07/06/2021 13:02

THIS ANNOUNCEMENT IS NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES,
CANADA, AUSTRALIA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH ITS DISTRIBUTION
MAY BE UNLAWFUL

THIS ANNOUNCEMENT INCLUDES INSIDE INFORMATION

BH MACRO LIMITED

(a closed-ended investment company incorporated in Guernsey with registration
number 46235)

LEI: 549300ZOFF0Z2CM87C29

28 May 2021

Proposed combination with BH Global Limited

Introduction

The Board of BH Macro Limited (the “Company” and “BHMG”) is pleased to
announce that it has agreed heads of terms with the Board of BH Global Limited
(“BHGG”) and Brevan Howard Capital Management LP, the manager of both BHMG
and BHGG (the “Manager”) in respect of the combination of BHMG with BHGG
(the “Combination”) to be effected by way of a scheme of reconstruction of
BHGG (the “Scheme”).

BHMG will be the continuing entity following the Combination and will continue
to follow its existing investment policy solely as a feeder fund into Brevan
Howard Master Fund Limited (the “Master Fund”).

The Scheme will be subject to the approval of BHGG’s shareholders. The
largest shareholders of both BHMG and BHGG have signalled their support in
principle for the Combination.

Under the Scheme, BHGG shareholders will be offered the option of exchanging
their shares for shares of the same currency class of BHMG or to receive a
cash payment. The Scheme will replace the proposed tender offer previously
announced by BHGG for up to 40% of each class of BHGG shares in issue
(excluding treasury shares). 

BHMG will proceed with its tender offer (the “BHMG Tender Offer”) for up
to 40% of its shares of each class in issue (excluding treasury shares) on the
basis previously announced. The BHMG Tender Offer will be completed prior to
implementation of the Scheme. 

The Board of BHMG believes that BHMG shareholders should benefit from the
Combination on the basis that, subject also to the outcome of the BHMG Tender
Offer, BHMG should be enlarged by the Combination, allowing BHMG’s fixed
costs to be spread over a larger cost base, alongside improving liquidity and
aiding marketing in respect of BHMG’s shares.

Further details on the Combination

Pursuant to the Scheme, BHGG shareholders will (subject to any applicable
regulatory restrictions) be given the option to elect to receive in place of
their existing BHGG shares:

(a)        BHMG shares of the same currency class and with the same
value on the basis of the relative NAVs per share of the relevant class of
each company on the effective date of the Combination (the “Share
Alternative”); or

(b)        a cash amount equal to 97.8% of the NAV per share of each
BHGG share held at the effective date of the Combination (the “Cash
Alternative”). 

These figures will not include the costs of the Combination and the BHMG
figures will not include any uplift that may otherwise have been created by
the BHMG Tender Offer. BHGG shareholders electing for the Cash Alternative
will also receive an additional amount per share to offset the impact of the
increase of the BHGG management fee effective from 1 July 2021.

The assets of BHGG attributable to shares for which Share Alternative
elections are made will be transferred to the Company for investment in the
Master Fund.  Any other assets of BHGG remaining after payment of the Cash
Alternative and the liabilities and costs of the liquidation of BHGG
(including BHGG’s costs in respect of the Scheme) will also be transferred
to the Company, subject to an agreed retention being made by the liquidators
in respect of any unknown or unascertainable liabilities of BHGG.

BHGG will meet its costs of the Combination out of those of its assets
representing the difference between the payments made in respect of Cash
Alternative elections and the net asset value of the shares in respect of
which those elections were made. The Company has also agreed to make a
contribution to BHGG to cover any shortfall if such assets prove insufficient
to meet BHGG’s budgeted costs (which will depend upon the extent of Cash
Alternative elections made by BHGG’s shareholders). 

The Company will meet its costs of the Combination from the uplift delivered
from the BHMG Tender Offer and any assets transferred from BHGG in excess of
those that are invested in the Master Fund in respect of shares issued
pursuant to the Share Alternative.  In addition, the Manager has agreed to
make a contribution to the Company in respect of its costs of the Combination
if required to help ensure that the Combination is not NAV dilutive for
continuing shareholders.

Expected timetables

Subject to the receipt of applicable regulatory and tax approvals, it is
anticipated that documentation regarding the Combination will be sent to BHGG
shareholders by the end of June 2021 and, subject to BHGG shareholder approval
being obtained, the Combination will be effected prior to the end of August
2021 on the basis of BHMG’s and BHGG’s respective July 2021 month end
NAVs. 

A circular in respect of the BHMG Tender Offer will be sent to BHMG
shareholders shortly, with the tender period being open during June 2021, the
tender prices being calculated by reference to the BHMG June 2021 month end
NAVs and the tender consideration being paid prior to the end of July 2021. 

Enquiries:

Richard Horlick
Chairman

William Simmonds
J.P. Morgan Cazenove

020 7742 4000

Edward Berry / Josh Sarson
FTI Consulting

07703 330 199 / 0755 499 1072

Important notices

J.P. Morgan Securities plc, which conducts its UK investment banking
activities as J.P. Morgan Cazenove ("J.P. Morgan Cazenove"), which is
authorised by the Prudential Regulation Authority and regulated by the
Prudential Regulation Authority and the Financial Conduct Authority in the
United Kingdom, is acting exclusively for the Company and no-one else in
connection with the Combination, the BHMG Tender Offer and will not be
responsible to anyone other than the Company for providing the protections
afforded to customers of J.P. Morgan Cazenove or for providing advice in
relation to the Combination, the BHMG Tender Offer or any other matter
referred to herein.

This announcement does not constitute an offer or solicitation to acquire or
sell any securities in the Company. This announcement is not for distribution
in or into the United States, Canada, Australia or Japan or any other
jurisdiction in which its distribution may be unlawful. This announcement is
not an offer of securities for sale in the United States or elsewhere. The
securities of the Company have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "Securities Act"), and
may not be offered or sold in the United States unless registered under the
Securities Act or pursuant to an exemption from such registration. The Company
has not been and will not be registered under the US Investment Company Act of
1940, as amended, and investors are not entitled to the benefits of that Act.
There has not been and there will be no public offering of the Company's
securities in the United States.



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