TIDMAXI
RNS Number : 2348W
Axiom European Financial Debt Fd Ld
13 November 2017
NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, TO U.S. PERSONS OR IN OR INTO THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR ANY
JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.
This announcement is an advertisement and not a prospectus.
Investors should not purchase or subscribe for any shares referred
to in this announcement except on the basis of information
contained in the prospectus published by Axiom European Financial
Debt Fund Limited (the "Company") on 8 May 2017 (the "Prospectus")
in connection with the creation of a placing programme (the
"Placing Programme") in respect of new ordinary shares of no par
value in the capital of the Company ("Shares"). This announcement
does not constitute and may not be construed as an offer to sell or
an invitation to purchase investments of any description, or as a
recommendation or the provision of investment advice by any party.
No information set out in this announcement or referred to in other
written or oral form (other than the Prospectus) is intended to
form the basis of any contract for sale, investment decision or any
decision to purchase shares in the Company.
13 November 2017
Axiom European Financial Debt Fund Limited
Proposed Placing and Company update
Proposed Placing
The Board recognises the strong performance of the Company over
the last 12 months and is pleased to announce that the Company is
proposing to undertake a placing of new Shares under the Company's
existing Placing Programme (the "Placing").
The Company sees significant investment opportunities in the
market over the coming months deriving from improving fundamentals
in the financial sector, combined with the acceleration of the
Basel 3 transition period. The Company is seeking to deploy capital
into the subordinated debt market to benefit from the positive
credit actions by rating agencies, which should therefore support
further spread compression. The Company will focus more
specifically on the estimated EUR165bn legacy instruments universe,
which currently provides (in the Investment Manager's view) the
most attractive risk reward profile in the subordinated debt
market. As the Basel 3 transition period enters its last phase,
corporate actions such as tenders and calls should accelerate,
hence supporting valuations. With year-to-date returns in excess of
14%, the Company sees the current period as a very attractive
window of opportunity to achieve its 10% long term target
returns.
Any new Shares issued pursuant to the Placing will be issued at
a 1.6% premium to the latest published estimated cum income NAV per
share, as at the time the Placing closes, to cover the costs of the
Placing (the "Placing Price").
Winterflood Securities Limited ("Winterflood") has been
appointed as sole corporate broker and financial adviser to the
Company, and will act as bookrunner in relation to the Placing.
The expected timetable for the Placing is as follows:
2017
------------------------- -----------------
Placing opens 13 November
------------------------- -----------------
Investor roadshow 13 November to 6
December
------------------------- -----------------
Publication of estimated Week commencing
NAV used to determine 4 December
the Placing Price
------------------------- -----------------
Placing closes 1.00 p.m. on 12
December
------------------------- -----------------
Results of Placing 13 December
announced
------------------------- -----------------
Admission of new 15 December
Shares
------------------------- -----------------
The Board notes that the current discount on the Shares may
impact the above timetable. In the event that the dates change or
the Placing is delayed, the Company will make a separate
announcement.
All Shares issued pursuant to the Placing will, when issued and
fully paid, confer the right to receive all dividends or other
distributions made, paid or declared, if any, by reference to a
record date after the date of their issue. The Placing Programme
has a maximum capacity of up to 500 million Shares.
Application will be made to the London Stock Exchange ("LSE")
for the new Shares issued pursuant to the Placing to be admitted to
trading on the Specialist Fund Segment. It is expected that
dealings in the new Shares will commence at 8.00 a.m. on 15
December 2017.
The Placing will be made through Winterflood, subject to the
terms and conditions contained in Part 7 of the Prospectus*. The
decision to allot new Shares to any person pursuant to the Placing
shall be at the absolute discretion of the Board, following
consultation with Winterflood and the Company's investment manager,
Axiom Alternative Investments SARL (the "Investment Manager").
By making an offer to subscribe for new Shares under the
Placing, investors will be deemed to have accepted the terms and
conditions of the Placing contained in Part 7 of the Prospectus*.
An investor that has made an offer to subscribe for new Shares
under the Placing accepts that following the closing of the
bookbuild such offer shall be irrevocable (subject to any statutory
withdrawal rights). Upon being notified of its allocation of new
Shares in the Placing, an investor shall be contractually committed
to acquire the number of new Shares allocated to it at the Placing
Price.
Winterflood, in agreement with the Company and the Investment
Manager, may choose to accept bids, either in whole or in part, on
the basis of allocations determined, and may scale down any bids
for this purpose, on such basis as the Company and Winterflood may
determine. Winterflood may also, notwithstanding the above, subject
to the prior consent of the Company: (i) allocate new Shares after
the time of any initial allocation to any person submitting a bid
after that time; and (ii) allocate new Shares after the bookbuild
has closed to any person submitting a bid after that time. The
Company reserves the right to reduce or increase the amount to be
raised pursuant to the Placing.
Company update
In addition to the Placing, the Board is pleased to announce
that it is currently considering a number of changes that it
believes could increase the appeal of the Company to investors.
These changes include:
-- Publishing daily NAVs, instead of weekly NAVs;
-- Transferring the Company's listing from the Specialist Fund
Segment of the LSE to the Premium Segment of the LSE;
-- Replacing the 7-yearly discontinuation resolution with a
commitment to provide full exit opportunities every seven years;
and
-- Implementing a more specific discount control mechanism.
Further details of each of these proposals are set out below.
For the avoidance of doubt, save for publishing daily NAVs, should
the Board determine to implement any of the above changes, their
implementation would follow the Placing, would be subject to
further announcements, and may also be subject to approval by
Shareholders.
Moving to daily NAVs
The Company currently publishes its estimated NAV per Share on a
weekly basis. However, the Company is in the process of updating
its procedures such that the Company's estimated NAV per Share can
be published on a daily basis to provide Shareholders with the most
up-to-date available information. Further details, including the
date on which the daily estimated NAV announcements will be
introduced, will be provided in due course.
Transfer to the Premium Segment of the LSE
At the Company's initial public offering, the Shares were
admitted to the Specialist Fund Segment of the LSE (then the
Specialist Fund Market). However, the Company has, since its
launch, voluntarily complied with the requirements for a Premium
Listing as set out in the Prospectus in the section entitled
"Voluntary compliance with the Listing Rules". The Board is of the
view that the Company and its Shareholders may benefit from the
Company transferring to a Premium Listing, in particular as this
may result in improved liquidity in the Shares and would enable the
Company to be available to a wider investor audience than is
currently the case while admitted to the Specialist Fund Segment.
Therefore, the Board is considering the merits of applying to the
LSE and to the UK Listing Authority (the "UKLA") for the Shares to
be admitted to trading on the Premium Segment of the LSE and to the
Premium Listing Segment of the Official List of the UKLA.
Removal of discontinuation votes and introduction of periodic
exit opportunities
The Company was launched with the intention to have an
indefinite life and the Company's articles of incorporation do not
provide for a scheduled winding up. However, under the current
arrangements, at every seventh annual general meeting, with the
first such opportunity being at the annual general meeting in 2022,
the Board is required to propose a special resolution that the
Company should cease to continue as presently constituted (a
"Discontinuation Resolution"). In the event that a Discontinuation
Resolution were passed, the Board would be required to formulate
proposals to be put to Shareholders within four months to wind-up
or otherwise reconstruct the Company, having regard (to the extent
applicable) to the illiquid nature of any of the Company's
underlying assets.
However, the Board believes that it could be in Shareholders'
interests to replace the discontinuation votes described above with
periodic opportunities for Shareholders to realise the value of
some or all of their Shares at a level close to Net Asset Value per
Share. The periodic exit opportunities would be provided at the
same times, but instead of, the discontinuation votes that they
would replace. The exact mechanism for such periodic exit
opportunities would be determined by the Board at the relevant
time.
Any such introduction of periodic exit opportunities in place of
Discontinuation Resolutions would be subject to the Board
determining, in its absolute discretion, that the introduction of
such periodic exit opportunities is likely to be in the interests
of Shareholders and to Shareholder approval. As part of reaching
such a decision, the Board will consider, among other matters, the
likely tax consequences for Shareholders of such changes to the
Company. Information in relation to such consequences would be
provided to Shareholders prior to any vote to approve the
introduction of such periodic exit opportunities.
Discount control policy
At the Company's annual general meeting on 6 April 2017 (the
"2017 AGM"), the Company was granted authority to purchase up to
14.99% of the Shares in issue immediately following the 2017 AGM,
being 9,133,521 Shares. Together with the Company's authority to
issue Shares under the Placing Programme, the Board is considering
the use of these authorities more proactively such that, in the
ordinary course of business, the Company would issue or repurchase
Shares with a view to maintaining the premium/discount at a level
close to NAV per Share in normal market conditions. The Directors
would consider a number of factors in determining whether to
exercise such discretion, including: (i) the Company having
sufficient liquidity and cash available for buybacks; (ii) any
share buybacks not having a negative impact on the Company's
investment portfolio; and (iii) satisfaction of the solvency test
under the Companies Law at the relevant time. The implementation of
such a policy is subject to further due diligence by the Board,
including as to any tax consequences for the Company and/or
Shareholders.
Other information
Terms used in this announcement shall, unless the context
otherwise requires, bear the meanings given to them in the
Prospectus which can be found on the Company's website at
http://axiom-ai.com/web/en/axiom-european-financial-debt-fund-limited-2/.
References in the Prospectus to Liberum should instead be read
(where applicable) to refer to Winterflood Securities Limited
("Winterflood"), which has been appointed as sole corporate broker
and financial adviser to the Company, and as bookrunner in relation
to the Placing.
The Company expects shortly to enter into a placing agreement
with Winterflood and the Investment Manager in relation to the
Placing.
For further information please contact:
Axiom Alternative Investments
SARL
David Benamou, Managing Partner
Jerome Legras, Managing Partner +44(0)20 3807 0670
Winterflood Securities Limited
Andrew Marshall
Joe Winkley
Neil Morgan +44(0)20 3100 0000
MHP Communications
Reg Hoare
Giles Robinson
Rachel Cohen +44 (0)20 3128 8100
* References in the terms and conditions in Part 7 of the
Prospectus to Liberum should be read, for the purposes of the
Placing, as references to Winterflood.
Important Information
This announcement is not for distribution, directly or
indirectly, in or into the United States of America (including its
territories and possessions, any state of the United States of
America and the District of Columbia) (the "United States"),
Australia, Canada, Japan or South Africa. This announcement does
not constitute, or form part of, an offer to sell, or a
solicitation of an offer to purchase, any securities in the United
States, Australia, Canada, Japan or South Africa. The securities of
the Company have not been and will not be registered under the U.S.
Securities Act of 1933, as amended (the "Securities Act") or the US
Investment Company Act of 1940, as amended and may not be offered
or sold directly or indirectly in or into the United States or to
or for the account or benefit of any U.S. Person (within the
meaning of Regulation S under the Securities Act). The securities
referred to herein have not been registered under the applicable
securities laws of Australia, Canada, Japan or South Africa and,
subject to certain exceptions, may not be offered or sold within
Australia, Canada, Japan or South Africa or to any national,
resident or citizen of Australia, Canada, Japan or South
Africa.
This announcement has been issued by and is the sole
responsibility of the Company.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by, Winterflood or by any of its affiliates
or agents as to or in relation to the accuracy or completeness of
this announcement or any other written or oral information made
available to or publicly available to any interested party or its
advisers and any liability therefore is expressly disclaimed.
Winterflood, which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting as sole
financial adviser to the Company and bookrunner and is acting for
no-one else in connection with the Placing and the contents of this
announcement and will not be responsible to anyone other than the
Company for providing the protections afforded to clients of
Winterflood or for providing advice in connection with the Placing
and the contents of this announcement or any other matter referred
to herein.
This announcement includes statements that are, or may be deemed
to be, "forward-looking statements". These forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms "believes", "estimates",
"anticipates", "expects", "intends", "may", "will" or "should" or,
in each case, their negative or other variations or comparable
terminology. These forward-looking statements include all matters
that are not historical facts. All forward-looking statements
address matters that involve risks and uncertainties. Accordingly,
there are or will be important factors that could cause the
Company's actual results to differ materially from those indicated
in these statements. Any forward-looking statements in this
announcement reflect the Directors' current views with respect to
future events and are subject to these and other risks,
uncertainties and assumptions relating to the Company's operations,
results of operations and growth strategy. Prospective investors
should specifically consider the factors identified in this
announcement and the Prospectus which could cause actual results to
differ before making an investment decision. These forward looking
statements speak only as of the date of this announcement. Subject
to its legal and regulatory requirements, the Company expressly
disclaims any obligation to update or revise any forward-looking
statement contained herein to reflect changes in expectations with
regard thereto or any change in events, conditions or circumstances
on which any statement is based, unless required to do so by law or
any appropriate regulatory authority, including FSMA, the London
Stock Exchange, the GFSC, the RCIS Rules, the Prospectus Rules, MAR
and the Disclosure Guidance and Transparency Rules.
This announcement does not constitute an invitation to engage in
investment activity.
The value of investments may go down as well as up, and all of
an investment in the Company would be at risk. Past performance is
not a guide to future performance and the information in this
announcement or any documents relating to the Placing Programme
cannot be relied on as a guide to future performance. Persons
needing advice should contact a professional adviser.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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