REG-Miton UK Microcap Trust Plc: Publication of Circular

Miton UK Microcap TrustAnnouncement

12/03/2025 07:15

12 March 2025

Miton UK MicroCap Trust plc

("MINI" or the "Company")

Publication of Circular

Further to the Company's announcement on 31 January 2025 in connection with
the proposals for the reconstruction and voluntary winding-up of the Company
(the "Proposals"), the Board is today publishing a circular (the "Circular")
putting forward the Proposals and convening the required General Meetings.

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. The Circular will also
be available on the Company's website (https://www.mitonukmicrocaptrust.com)
and at the registered office of the Company (50 Bank Street, London, E14 5NT).

Introduction

On 31 January 2025, the Board announced that, following significant
redemptions by Shareholders in October 2024 pursuant to the Company's annual
redemption facility, it had concluded that it is in Shareholders' best
interests to put forward proposals for the reconstruction and members'
voluntary winding-up of the Company, through a scheme of reconstruction under
Section 110 of the Insolvency Act 1986 (the "Scheme"). Under the Proposals,
Shareholders (other than Restricted Shareholders) will be able to elect (in
whole or in part and in accordance with their personal investment
requirements) to roll over their investment into Premier Miton UK Smaller
Companies Fund (the "Sub-Fund"), a sub-fund of Premier Miton Investment Funds
3 (the "OEIC") and/or to receive their entitlement upon the winding-up of the
Company in cash.

The Options

Shareholders may elect, in whole or in part and in accordance with their
personal investment requirements, for either or both of the following options:

(a)                     the Rollover Option - rolling over
some or all of their investment into Sub-Fund Shares to be issued by the
Sub-Fund; and/or

(b)                     the Cash Option - receiving cash
in the liquidation of the Company in respect of some or all of their
investment in the Company.

Shareholders (other than Restricted Shareholders) that make no Election (or no
valid Election) will be deemed to have elected for Sub-Fund Shares. The key
features of the Sub-Fund are set out below and in Part 3 of the Circular.
Shareholders should also refer to the OEIC Prospectus and Sub-Fund KIID which
are available at
https://www.premiermiton.com/funds/premier-miton-uk-smaller-companies-fund/.
The OEIC Prospectus and Sub-Fund KIID do not form part of the Circular (and
the Board takes no responsibility for the contents of the OEIC Prospectus or
the Sub-Fund KIID).

The Proposals

Under the Proposals, the Company will be wound up on the Winding-up Date by
means of a members' voluntary liquidation pursuant to a scheme of
reconstruction under Section 110 of the Insolvency Act 1986 and Shareholders
may elect to receive Sub-Fund Shares in the Sub-Fund (being Premier Miton UK
Smaller Companies Fund) and/or cash in respect of all or part of their holding
of Ordinary Shares in the Company. Shareholders who elect to roll over their
investment into the Sub-Fund will receive Sub-Fund Shares and, in
consideration of such issue, the Company will transfer a portion of its net
assets to the OEIC (for the benefit of the Sub-Fund). In this way, it is
envisaged that it should be possible for most UK resident Shareholders who
hold their Ordinary Shares as investments to be given a tax-efficient rollover
of their entitlements.

The Sub-Fund Shares will be issued at the prevailing net asset value per
Sub-Fund Share as at 12.00 noon on the Effective Date. Sub-Fund Shares issued
pursuant to the Rollover Option will be issued without any initial charge and
the investment minimum will be waived.

Shareholders who elect for the Cash Option will be sent a cheque in respect of
their entitlement if they hold Ordinary Shares in certificated form or,
receive payment through CREST in respect of their entitlement if they hold
Ordinary Shares in uncertificated form.

Shareholders' approval is required to implement parts of the Proposals which
will involve the reclassification of the Company's existing Ordinary Shares to
give effect to the respective options for which each Shareholder has elected,
the voluntary winding-up of the Company and the appointment of the
Liquidators.

In order to consider and approve the Proposals, General Meetings have been
convened for 10 April 2025 (the "First General Meeting") and 21 May 2025 (the
"Second General Meeting"). The purpose of the Circular is to provide
Shareholders with further details of the Proposals and the reasons why the
Directors recommend that Shareholders vote in favour of the Resolutions to be
proposed at the General Meetings.

The Resolutions to be proposed at the General Meetings, on which all
Shareholders may vote, are required in order to obtain certain Shareholder
authorities in accordance with the Companies Act 2006, the Insolvency Act 1986
and the Listing Rules, as follows:

(a)    at the First General Meeting, (i) to approve the terms of the Scheme
set out in Part 2 of the Circular; (ii) to amend the Articles to give effect
to the Scheme; (iii) to authorise the Liquidators to enter into and give
effect to the Transfer Agreement, to distribute Sub-Fund Shares and cash to
Shareholders in accordance with the Scheme, to purchase the interests of any
Dissenting Shareholders to the Scheme and to authorise the Liquidators to
apply to cancel the listing of the Reclassified Shares, with effect from such
date as the Liquidators may determine; and

(b)    at the Second General Meeting, amongst other things, to appoint the
Liquidators and to wind up the Company.

Benefits of the Proposals

The Directors consider that the Proposals should have the following benefits
for all Shareholders as compared to their current position, or under a
liquidation:

(a)    they enable Shareholders to roll over some or all of their
investment into the Sub-Fund which has a similar investment objective to the
Company and is managed by the same individuals at the Investment Manager who
manage the Company's portfolio, thereby maintaining a similar investment
approach;  

(b)    Shareholders electing for the Rollover Option will not suffer the
full dealing costs that would be incurred on the realisation of the Company's
portfolio in the event of a simple winding-up; and

(c)    Shareholders who may be subject to UK capital gains tax or
corporation tax on chargeable gains should generally be able to roll over
their investment into the Sub-Fund and thereby continue to receive investment
returns without triggering an immediate liability to UK capital gains tax or
corporation tax on chargeable gains.

Shareholders who elect for the Cash Option in respect of some or all of their
investment will receive cash in the liquidation of the Company to the extent
of their Election for the Cash Option. Shareholders should note that,
depending on their particular circumstances, this may trigger a chargeable
gains tax liability. Please refer to the paragraph headed "Taxation" in Part 4
of the Circular for further details.

Shareholders who are in any doubt as to the contents of the Circular or as to
the action to be taken should immediately seek their own personal financial
advice from an appropriately qualified independent adviser authorised pursuant
to FSMA.

Conditions to the Scheme

The Scheme is conditional, among other things, upon:

(a)    the passing of all Resolutions to be proposed at (i) the First
General Meeting and (ii) the Second General Meeting (or at any adjournments
thereof) and upon any conditions of such Resolutions being fulfilled;

(b)    the FCA agreeing to amend the listing of the Ordinary Shares to
reflect their reclassification as Reclassified Shares for the purpose of
implementing the Scheme; and

(c)    the Directors resolving to proceed with the Scheme.

In the event that any of the conditions referred to in (a)(i) or (b) above
fails, the Second General Meeting will be adjourned indefinitely and the
Scheme will lapse.

Sub-Fund

The Sub-Fund is an open-ended investment fund which aims to achieve capital
growth over the long term, by investing in an actively managed portfolio with
a minimum of 70 per cent. of its assets in shares of smaller companies
incorporated or domiciled in the UK. The Sub-Fund may also invest up to 30 per
cent. of its assets in larger companies incorporated or domiciled in the UK as
well as listed securities in other geographical regions.

Please refer to Part 3 of the Circular for further details on the Sub-Fund,
including details of the investment objective and investment policy of the
Sub-Fund.

The Sub-Fund is managed by the same individuals at the Investment Manager that
manage the Company's portfolio, with the same valuation-driven philosophy as
the Company and has a similar investment approach. The Sub-Fund has similar
investment objectives to the Company and there is some overlap of portfolio
holdings. It is larger than the Company, with net assets of around £41.8
million as at the Latest Practicable Date, and benefits from a lower ongoing
charges ratio.

The OEIC (product reference number: 565733) is an open-ended investment
company with variable capital incorporated in England and Wales and authorised
by the Financial Conduct Authority as an undertaking for collective investment
in transferable securities (UCITS scheme) with effect from 14 September 2011.
The Sub-Fund (being a sub-fund of the OEIC whose product reference number is
637740) is itself approved as a sub-fund of the OEIC.

The Sub-Fund Shares will not be admitted to listing and/or to trading by any
authority or stock exchange.

Full details of the mechanics of the Scheme and entitlements of Shareholders
under the Scheme are contained within the Circular.

Interim Dividend

It is anticipated that the Company may pay one or more interim dividends in
advance of the Effective Date in order to ensure that the Company meets the
distribution requirements to maintain investment trust status. Information
relating to the declaration and payment of interim dividends (if any) will be
released by the Company via an RNS in advance of the Effective Date.

Costs of the Proposals

The Company will bear its own costs and expenses incurred in connection with
the Proposals.

Any liability for transfer taxes in respect of the transfer of certain assets
to the Sub-Fund will be borne by the Sub-Fund, provided that, in those
jurisdictions where it is customary for the liability for transfer tax to be
split between the transferor and the transferee, the Company shall bear such
part of the transfer tax liability (as part of its own costs and expenses
incurred in connection with the Proposals) to the extent that such part of the
transfer tax liability is customarily borne by the transferor in the relevant
jurisdiction.

The costs payable by the Company in connection with the implementation of the
Proposals are expected to be approximately £500,000 (including VAT, where
applicable). These costs have not been accrued in the Company's net asset
value as at the Latest Practicable Date.

General Meetings

The implementation of the Proposals will require two General Meetings of the
Company which have been convened for:

a)      11.00 a.m. on 10 April 2025 at 1 Finsbury Circus, London, EC2M
7SH (the "First General Meeting"); and

b)      11.00 a.m. on 21 May 2025 at 1 Finsbury Circus, London, EC2M 7SH
(the "Second General Meeting").

The notices convening these meetings are set out at the end of the Circular.
All Shareholders are entitled to attend and vote at the First General Meeting
and the Second General Meeting, and on a show of hands, shall each have one
vote and, on a poll, shall have one vote for every Ordinary Share held by
them.

The Resolutions to be proposed at the General Meetings will, if passed,
approve the Scheme and put the Company into liquidation, as further described
below.

At the First General Meeting, Resolutions will be proposed which, if passed,
will:

a)      amend the Articles of Association in order to implement the
Scheme and make provision for the issue of the relevant numbers of Sub-Fund
Shares to Shareholders on a winding-up of the Company;

b)      subject to the Scheme becoming unconditional, authorise the
implementation of the Scheme by the Liquidators, including the entry into the
Transfer Agreement by the Liquidators, the allotment of the relevant number of
Sub-Fund Shares, by the Sub-Fund, to the Liquidators (who will renounce such
shares in favour of the relevant Shareholders) and the realisation of the Cash
Pool and distribution of cash by the Liquidators to the relevant Shareholders;
and

c)       subject to the Scheme becoming unconditional, authorise the
Liquidators to purchase the interests of Dissenting Shareholders and to apply
to cancel the listing of the Company's Ordinary Shares, with effect from such
date as the Liquidators will determine.

If the Scheme is not approved by Shareholders at the First General Meeting,
the Proposals will be abandoned, and the Second General Meeting will be
adjourned indefinitely. In this event, the Board will consider alternative
proposals for the future of the Company, the implementation of which may
result in additional costs being incurred.

At the Second General Meeting, a special resolution will be proposed which, if
passed, will place the Company into liquidation, appoint the Liquidators and
agree the basis of their remuneration, instruct the Company Secretary to hold
the books to the Liquidators' order, and provide the Liquidators with
appropriate powers to carry into effect the amendments to the Articles made at
the First General Meeting. The Resolution to be proposed at the Second General
Meeting is conditional upon the Directors and the OEIC ACD resolving to
proceed with the Scheme.

The Resolutions will require the approval of 75 per cent. or more of the votes
cast at the relevant meeting, whether in person or by proxy.

 

 

 

 

Expected Timetable

2025

 Latest time and date for receipt of proxy appointments from Shareholders for the First General Meeting                                   11.00 a.m. on 8 April                                    
 Latest time and date for receipt of the Form of Election and/or TTE Instructions from Shareholders wishing to elect for the Cash Option  1.00 p.m. on 8 April                                     
 Scheme Entitlements Record Date                                                                                                          6.00 p.m. on 8 April                                     
 Ordinary Shares disabled in CREST                                                                                                        6.00 p.m. on 8 April                                     
 Suspension of trading in Ordinary Shares                                                                                                 7.30 a.m. on 9 April                                     
 First General Meeting                                                                                                                    11.00 a.m. on 10 April                                   
 Calculation Date                                                                                                                         11.59 p.m. on 16 May                                     
 Reclassification of the Ordinary Shares                                                                                                  8.00 a.m. on 19 May                                      
 Latest time and date for receipt of proxy appointments from Shareholders for the Second General Meeting                                  11.00 a.m. on 19 May                                     
 Suspension of dealings in Reclassified Shares                                                                                            7.30 a.m. on 21 May                                      
 Second General Meeting                                                                                                                   11.00 a.m. on 21 May                                     
 Appointment of the Liquidators                                                                                                           21 May                                                   
 Effective Date and Transfer Agreement executed and implemented                                                                           21 May                                                   
 Sub-Fund Shares issued pursuant to the Scheme                                                                                            21 May                                                   
 First day of dealing in Sub-Fund Shares                                                                                                  22 May                                                   
 Contract notes expected to be despatched in respect of Sub- Fund Shares issued pursuant to the Scheme                                    As soon as practicable following the Effective Date      
 Cheques expected to be despatched and CREST payments made to Shareholders in respect of the Cash Option                                  Not later than 10 Business Days from the Effective Date  
 Cancellation of listing of Reclassified Shares                                                                                           As soon as practicable following the Effective Date      

 

The times and dates set out in the expected timetable of events above and
mentioned throughout the announcement may be adjusted by the Company in which
event details of the new times and dates will be notified, as requested, to
the Financial Conduct Authority, the London Stock Exchange and, where
appropriate, Shareholders. All references to time in this announcement are to
UK time.

This announcement does not contain all the information which is contained in
the Circular and Shareholders should read the Circular, the OEIC Prospectus
and the Sub-Fund KIID to make an informed Election under the Proposals.

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

Enquiries:

Peel Hunt LLP  020 7418 8900

Luke Simpson

Liz Yong

Huw Jeremy

 

Legal Entity Identifier: 21380048Q8UABVMAG916

 



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