REG - Dunedin Enterprise - Tender Offer

Dunedin Enterprise Investment TrustAnnouncement

21/10/2022 07:01

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RNS Number : 6283D  Dunedin Enterprise Inv Trust PLC  21 October 2022

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN OR INTO, CANADA, JAPAN, NEW ZEALAND, THE REPUBLIC OF SOUTH
AFRICA OR THE UNITED STATES OF AMERICA OR ANY OTHER JURISDICTION WHERE TO DO
SO MAY RESULT IN THE CONTRAVENTION OF ANY REGISTRATION OR OTHER LEGAL
REQUIREMENT OF SUCH JURISDICTION OR OF THE UK

21 October 2022

Dunedin Enterprise Investment Trust PLC

Legal Entity Identifier: 213800E2VLUZ5AF9Z434

As set out in the interim results of Dunedin Enterprise Investment Trust PLC
(the "Company") published on 16 September 2022, the Board of the Company has
looked at opportunities to combine the proceeds of more than one realisation
from the Company's portfolio before conducting a further tender offer in order
to achieve economies in the process.

The Company announced in March 2022 that it has realised its investment in
Incremental and, as announced on 7 October 2022, Dunedin Buyout Fund II LP has
now completed the realisation of the investment in RED, the provider of SAP
contract and permanent staff.

Following these realisations and in accordance with the Company's distribution
and investment policies, the Board is therefore proposing to return up to £41
million to Shareholders pursuant to a tender offer ("Tender Offer").

The Company has today published a circular providing shareholders with full
details of the Tender Offer. A copy of the Circular will be submitted to the
National Storage Mechanism and will shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) . The Circular will
also be available on the Company's website (https://www.dunedinenterprise.com/
(https://www.dunedinenterprise.com/) ).

Details of the Tender Offer

The Tender Offer will enable those Shareholders (other than Sanctions
Restricted Persons, Restricted Shareholders and certain Overseas Shareholders)
who wish to sell some or all of their Shares to elect to do so, subject to the
overall limits of the Tender Offer. Shareholders who successfully tender
Shares will receive the Tender Price per Share, being a 1.0 per cent. discount
to the NAV per Share as at 30 September 2022 (adjusted for the Dividend of 34
pence per Share (as defined below) announced today).

Under the terms of the Tender Offer, which is being made by Singer Capital
Markets Securities Limited ("Singer Capital Markets"), Shareholders (other
than Sanctions Restricted Persons, Restricted Shareholders and certain
Overseas Shareholders) will be entitled to tender up to their Basic
Entitlement, rounded down to the nearest whole Share. Shareholders may also
tender additional Shares, but any such excess tenders above the Basic
Entitlement will only be satisfied, on a pro rata basis, to the extent that
other Shareholders tender less than their Basic Entitlement.

The Tender Price and the Basic Entitlement will be announced on 1 November
2022, alongside the Company's NAV per Share as at 30 September 2022. The
maximum number of Shares that will be purchased under the Tender Offer will be
calculated by dividing £41 million by the Tender Price. The aggregate Basic
Entitlement will equal the percentage of the Company's issued Share capital
represented by the aggregate number of Shares that will be purchased under the
Tender Offer.

Subject to the satisfaction of the conditions relating to the Tender Offer,
Singer Capital Markets will purchase, as principal, Shares validly tendered
under the Tender Offer at the Tender Price. Following completion of those
purchases, it will then sell all the relevant Shares back to the Company
pursuant to the Repurchase Agreement at the Tender Price by way of an
on-market transaction on the main market for listed securities of the London
Stock Exchange. The Shares which the Company acquires from Singer Capital
Markets will be cancelled. The repurchase of Shares by the Company under the
Repurchase Agreement will be funded from the Company's special distributable
reserve.

The Tender Offer is subject to the terms and conditions set out in the
Circular. The Tender Offer may also be terminated in certain circumstances as
set out in the Circular. Shareholders should note that, once tendered, Shares
may not be sold, transferred, charged or otherwise disposed of other than in
accordance with the Tender Offer.

Existing Share buy back authority

The Company's existing authority to repurchase its own Shares, which was
granted at the last annual general meeting of the Company held on 11 May 2022
and equated to authority to repurchase up to 1,969,207 Shares (being
approximately 14.99 per cent. of the Company's issued share capital as at the
date of that meeting), will remain in force and be unaffected by the Tender
Offer.

Estimated expenses

The fixed costs relating to the Tender Offer are expected to be approximately
£200,000 including VAT, assuming the Tender Offer is taken up in full. The
foregoing figure does not include stamp duty. Assuming the Tender Offer is
taken up in full, the Company estimates that the costs of stamp duty will be
approximately £205,000. All costs in relation to the Tender Offer will be
borne by the Company. Assuming the Tender Offer is taken up in full, the costs
of the Tender Offer are not expected to result in dilution to the NAV per
Share.

Overseas Shareholders, Restricted Shareholders and Sanctions Restricted
Persons

The making of the Tender Offer to persons outside of the United Kingdom may be
prohibited or affected by the laws of the relevant overseas jurisdictions.
Shareholders with registered or mailing addresses outside of the United
Kingdom who are citizens or nationals of, or resident in, a jurisdiction other
than the United Kingdom should read the relevant sections of the circular
carefully.

The Tender Offer is not being made to Shareholders who are resident in, or
citizens of, Restricted Jurisdictions. Restricted Shareholders are being
excluded from the Tender Offer in order to avoid offending applicable local
laws relating to the implementation of the Tender Offer. Accordingly, copies
of the Tender Form are not being and must not be mailed or otherwise
distributed in or into Restricted Jurisdictions.

It is the responsibility of all Overseas Shareholders to satisfy themselves as
to the observance of any legal requirements in their jurisdiction, including,
without limitation, any relevant requirements in relation to the ability of
such holders to participate in the Tender Offer.

In order to comply with the Company's obligations under the UK's domestic and
international sanctions regimes, Sanctions Restricted Persons are not entitled
to participate in the Tender Offer. For the avoidance of doubt, neither the
Dividend (as defined below) nor any consideration for Shares tendered pursuant
the Tender Offer will be paid to a Sanctions Restricted Person.

Dividend

The Company has today announced an interim dividend for the financial year
ending 31 December 2022 of 34 pence per Share which is to be paid on 24
November 2022 to Shareholders on the Register as at 6.00 p.m. on 4 November
2022 (the "Dividend").

This follows the Company's announcements of 25 August 2022 and 7 October 2022
that, following regulatory approval, Dunedin Buyout Fund II LP has realised
the investment in RED, the provider of SAP contract and permanent staff, from
which the Company has received £24.1 million of proceeds (the "RED
Realisation"). The Company notes that this is an uplift of £0.4 million to
the valuation of the investment in RED reported in the Company's interim
report and accounts for the period ended 30 June 2022. In particular, of the
£24.1 million of proceeds received from the RED Realisation, £4.0 million
comprised income.

Future realisations

In line with the Company's investment policy, the Investment Manager will
continue to conduct the orderly realisation of the Company's assets in a
manner that seeks to achieve a balance between maximising the value of the
Company's investments and progressively returning cash to Shareholders.

Realisation opportunities will be considered by the Investment Manager as
appropriate but there can be no certainty as to the precise timing or quantum
of any such realisations which will depend, inter alia, on prevailing market
conditions.

Consequently, there can also be no certainty as to the precise timing or
quantum of any future returns of capital to Shareholders, if any, following
receipt by the Company of the net proceeds of such realisations.  Any future
returns of capital to Shareholders will also be dependent on the Company's
liabilities, its uncalled fund commitments and general working capital
requirements.

The Board acknowledges the importance of monitoring the Company's ongoing
costs as the realisation progresses and will continue to keep the options
available to the Company under review. That said, following consideration of
the Company's remaining investments and discussions with the Investment
Manager and the Company's advisers, the Board does not currently anticipate
putting formal proposals to Shareholders for a members' voluntary liquidation
of the Company in the short to medium term while the orderly realisation
continues. Furthermore, the Board considers maintaining the Company's listed
status to be important during this stage of the orderly realisation as it is
aware that many Shareholders would be unable to hold the Shares, or greatly
inconvenienced by holding them, if they were not admitted to trading on the
London Stock Exchange. As the realisation progresses, the Board will continue
to assess whether the Company's current arrangements remain in the interests
of Shareholders as a whole and will continue to keep Shareholders informed as
to the future of the Company.

General Meeting

The Tender Offer is subject to Shareholder approval at a General Meeting which
is to be held at the offices of Dickson Minto W.S. at 16 Charlotte Square,
Edinburgh EH2 4DF on 16 November 2022 at 12 noon. At this meeting a special
resolution will be proposed to approve the Tender Offer on the terms set out
in the Circular and to give the Company authority to make market purchases
pursuant to the Tender Offer.  Should the resolution fail to be passed, the
Tender Offer will not proceed.

The Board has chosen to seek authority to purchase a maximum of 9,000,000
Shares, representing approximately 68.5 per cent. of the issued Share capital
of the Company as at the date of this announcement. The maximum number of
Shares to be purchased under the Tender Offer will not be known until the
Tender Price has been calculated. The Board has therefore chosen this figure
to ensure that there is sufficient capacity under the authority to return the
full £41 million to Shareholders.

The Board makes no recommendation to Shareholders as to whether or not they
should tender all or any of their Shares in the Tender Offer. Whether or not
Shareholders decide to tender their Shares will depend, amongst other factors,
on their view of the Company's prospects and their own individual
circumstances, including their own tax position.

The Directors intend to use reasonable endeavours to tender their Basic
Entitlement in the Tender Offer.

 

EXPECTED TIMETABLE

                                                                                2022
 Tender Offer opens                                                             21 October
 NAV per Share as at 30 September 2022, Tender Price and Basic Entitlement      1 November
 percentage announced
 Latest time and date for receipt of Forms of Proxy from Shareholders           12 noon on 14 November
 General Meeting                                                                12 noon on 16 November
 Results of General Meeting announced                                           16 November
 Latest time and date for receipt of Tender Forms and submission of TTE          1.00 p.m. on 18 November
 Instructions from Shareholders
 Record Date and time for the Tender Offer                                      6.00 p.m. on 18 November
 Results of Tender Offer elections announced                                    22 November
 CREST accounts credited for revised uncertificated shareholdings of Shares     By 24 November
 (or, in the case of unsuccessful tenders, for entire holdings of Shares)
 CREST Settlement Date: payments through CREST made and CREST accounts settled  24 November
 Balancing share certificates and cheques despatched to certificated            Week commencing 28 November
 Shareholders
 Notes
 1.                References to times in this document are to
 London time.
 2.                The dates set out in the expected timetable
 (other than in relation to the General Meeting) may be adjusted by the
 Company, in which event details of the new dates will be notified to
 Shareholders by an announcement made by the Company through a Regulatory
 Information Service.

Defined terms used in this announcement have the meanings given in the
Circular unless the context otherwise requires

For further information please contact:

Dunedin LLP

Graeme Murray 07813 138 367

Singer Capital Markets

Robert Peel                   020 7496 3000

This announcement contains inside information for the purposes of Article 7 of
Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 and as amended ("MAR"), and
is disclosed in accordance with the Company's obligations under Article 17 of
MAR.

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