Company Update

Fidelity Japan Trust

17/04/2025 07:00

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.

 

17 April 2025

 

FIDELITY JAPAN TRUST PLC (the "Company" or "FJV")

 

Following the publication of the Company's 2024 final results on 27 March 2025, in which changes to the portfolio management team at Fidelity were also announced, and following the Company's announcement on 4 April 2025 in relation to the announcement made by AVI Japan Opportunity Trust Plc, the Board of FJV (the "Board") has held further discussions with representatives of a number of the Company's largest shareholders.

 

As required by the Company's Articles of Association, the Company's AGM notice dated 26 March 2025 includes a resolution for the Company to continue as an investment company (the "Continuation Resolution"). The result of the discussions referred to above is that the Board does not expect the Continuation Resolution to be approved by a majority of shareholders at the AGM on 21 May 2025.  In addition, the Board has subsequently received a small number of unsolicited and credible indicative proposals from outside parties.

 

The possibility that the Continuation Resolution might not be approved by a majority of shareholders was referenced in the 2024 Annual Report dated 26 March 2025. However, in accordance with the Articles of Association of the Company, the Continuation Resolution must still be put to the AGM on 21 May 2025.  The Board continues to recommend shareholders vote in favour of all the resolutions being put at the Company's AGM on 21 May 2025, including the Continuation Resolution and the resolution which proposes to extend the time permitted to draw up proposals regarding the Company's voluntary liquidation and/or reorganisation in the event of an unsuccessful continuation vote.  At present the Board has three months from the date of the vote to draw up proposals and to convene and hold a general meeting. It is proposed to increase this to six months. The proposed new timeframe is felt to provide a more realistic time period to facilitate due diligence, for proposals to be fully considered, and is in line with market practice.

 

Notwithstanding the fact that the Board continues to recommend that shareholders approve the Continuation Resolution, the Board has decided it is in the interests of all shareholders to start immediately a formal review process to consider the future of the Company (the "Review").  

 

The Board believes it is important to consider the interests of all shareholders and has appointed Stifel Nicolaus Europe Limited ("Stifel") to prepare a process which will invite formal proposals to be made privately to the Board.  The focus of the Board will be on those parties who are able to demonstrate a current record of managing Japanese equities in an existing London listed investment company structure.  This process will include an invitation to AVI Japan Opportunity Trust Plc. 

 

If the Continuation Resolution is not approved by a majority of shareholders at the AGM, the Board is currently assuming that, as a result of the Review, the Company is likely to enter into a scheme of reconstruction pursuant to section 110 of the Insolvency Act 1986 (a "s.110 Scheme") later in 2025.  Any s.110 Scheme which is recommended by the Board to shareholders will require 75 per cent shareholder approval of those voting.  As part of the Review, the Board will not actively consider the option of a transaction that would be subject to the Takeover Code, and do not believe such a transaction is a possible outcome of that Review.

 

The Board has been active on share buybacks during the last year.  However in light of the Review, it has decided to suspend on-market share buybacks by the Company.

 

The Company will update the market on the progress of the Review in due course, noting that at this stage there can be no certainty that the Review will result in a s.110 Scheme.

 

Enquiries

Fidelity Japan Trust Plc
David Graham(Chairman)
Via Stifel
Stifel
Edward Gibson-Watt
Andrew Yeo
Tel: +44 (0) 20 7710 7600

Important Information

 

This announcement is released by the Company and the information contained within this announcement is deemed by the Company to constitute inside information for the purposes of Article 7 of the UK version of the EU Market Abuse Regulation (Regulation (EU) No.596/2014) which forms part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended. Upon the publication of this announcement via a Regulatory Information Service, such information is now considered to be in the public domain.  The person responsible for arranging for the release of this announcement on behalf of the Company is David Graham, Chairman.

 

Legal Entity Identifier (LEI): 549300ND695NEJ5GPI72

 

Stifel Nicolaus Europe Limited ("Stifel"), which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, is acting exclusively as financial advisor and broker to FJV and no one else in connection with the Review and the matters and arrangements set out in this announcement. Stifel will not regard any other person as its client in relation to the Review or any other matter or arrangement set out in this announcement and will not be responsible to anyone other than FJV for providing the protections afforded to clients of Stifel, nor for providing advice in relation to the Review or any other matter or arrangement referred to in this announcement. Neither Stifel nor any of its affiliates (nor their respective directors, officers, employees or agents) owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, consequential, whether in contract, in tort, in delict, under statute or otherwise) to any person who is not a client of Stifel in connection with the Review, this announcement, any statement contained herein or otherwise. No representation or warranty, express or implied, is made by Stifel as to the contents of this announcement.