TIDMBHMG TIDMBHMU
THIS ANNOUNCEMENT IS NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES OR TO
ANY US PERSON, AUSTRALIA, CANADA, JAPAN, NEW ZEALAND, THE REPUBLIC OF SOUTH
AFRICA, ANY EUROPEAN ECONOMIC AREA STATE OR ANY OTHER JURISDICTION IN WHICH ITS
DISTRIBUTION MAY BE UNLAWFUL.
This announcement is an advertisement and not a prospectus for the purposes of
the Prospectus Regulation Rules of the Financial Conduct Authority ("FCA") or
otherwise. Investors should not subscribe for or purchase any securities
referred to in this announcement except solely on the basis of the information
contained in the prospectus proposed to be published by BH Macro Limited
(comprising a summary, registration document and securities note, together with
any supplementary prospectus, if relevant) including the risk factors set out
therein. Once published, a copy of the prospectus will be available for
inspection at BH Macro Limited's registered office and website at
www.bhmacro.com (subject to certain access restrictions) and at the National
Storage Mechanism via https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
THIS ANNOUNCEMENT INCLUDES INSIDE INFORMATION
BH MACRO LIMITED (the "Company")
(an authorised closed-ended collective investment scheme established as a
non-cellular company limited by shares under the laws of Guernsey with
registration number 46235)
LEI: 549300ZOFF0Z2CM87C29
Initial Placing, Intermediaries Offer and Offer for Subscription and Issuance
Programme
Proposed Share Sub-division
Publication of Circular and Notice of Extraordinary General Meeting
The board of directors (the "Directors" and, collectively, the "Board") of BH
Macro Limited (the "Company") is pleased to announce the launch of an initial
placing (the "Placing"), intermediaries offer (the "Intermediaries Offer") and
offer for subscription (the "Offer for Subscription" and, together with the
Placing and the Intermediaries Offer, the "Initial Issue") of new ordinary
shares of no par value each in the capital of the Company ("Shares") which may
be denominated as Sterling shares (the "Sterling Shares") or US dollar shares
(the "US Dollar Shares") at a price per Share of the relevant class equal to
the latest estimated net asset value per Share of the relevant class as at the
closing date of the Initial Issue (currently expected to be 10 February 2023)
(the "Initial Closing Date") plus a premium of two per cent. (the "Initial
Issue Price").
The Company also announces a proposed publication of a prospectus (the
"Prospectus") and circular to Shareholders in connection with the Initial Issue
and an Issuance Programme (with a maximum total issuance under the Initial
Issue and the Issuance Programme of 220 million new Shares, assuming that that
the Share Sub-Division described below becomes effective).
The Company will invest the proceeds of the Initial Issue (net of working
capital requirements) in Brevan Howard Master Fund Limited (the "Master Fund")
in accordance with the Company's investment policy.
While the capacity of the Master Fund to accept new investment may vary from
time to time, the Manager has agreed with the Company to procure that the
Master Fund will accept new investment by the Company of the aggregate net
proceeds and each subsequent issue under the Issuance Programme, subject to any
limitations on the Master Fund's capacity as may be generally applied from time
to time.
The Company is also announcing the proposed sub-division of its Shares, so that
each existing Share is replaced by ten Shares of the same currency class, in
order to assist in liquidity of the Shares (the "Share Sub-Division") and
certain amendments to the terms of the management agreement between the Company
and the Manager (the "Management Agreement") and the terms of the Company's
investment in the Master Fund. in order to reflect the increased investment of
the Company in the Master Fund as a result of the Initial Issue and the
Issuance Programme.
Initial Issue Highlights
· The premium to estimated net asset value represented by the Initial Issue
Price is less than the average premium to net asset value at which the Shares
have been trading at recently. For comparison, as at 20 January 2023, the
Sterling Shares have traded at an average premium to net asset value of 11.1
per cent. / 12.3 per cent. / 10.7 per cent. over the last twelve, six and three
months respectively. The US Dollar Shares have traded at an average premium to
net asset value of 11.5 per cent. / 12.5 per cent. / 10.6 per cent. over the
same time periods.
· The Directors believe that the launch of the Initial Issue and the
Issuance Programme are very significant and important developments for the
Company, which should lead to a significant increase in the Company's market
capitalisation and the liquidity in the Shares, as well as spreading the
Company's fixed costs over a wider share capital base.
· J.P. Morgan Securities plc (which conducts its UK investment banking
activities as J.P. Morgan Cazenove) ("JPMC") is acting as Sole Bookrunner and
Sole Sponsor in connection with the Initial Issue and the Issuance Programme.
Kepler Partners LLP is acting as Intermediaries Offer Adviser and Placing Agent
in connection with the Initial Issue.
· Applications will be made for Shares issued pursuant to the Initial Issue
to be admitted to listing on the Premium listing segment of the Official List
of the FCA and to trading on London Stock Exchange plc's main market for listed
securities.
· The Initial Issue, which is not underwritten, is subject to the terms and
conditions described in the Prospectus including, amongst other things, upon
the approval of the Prospectus by the FCA (expected later today) and
Shareholders passing the Issuance Resolutions at the Extraordinary General
Meeting (as further described below).
Issuance programme
Assuming the requisite authorities are approved by Shareholders at the
Extraordinary General Meeting, the Company will have the ability of raising
additional capital by issuing further Shares, up to the maximum number of
Shares available, by way of further issues (or sales from treasury) until 23
January 2024 (the "Issuance Programme"). It is proposed that, in aggregate, up
to 220 million new Shares (assuming that the Share Sub-Division described is
approved at the Extraordinary General Meeting and becomes effective) may be
issued as Sterling Shares or US Dollar Shares pursuant to the Initial Issue and
the Issuance Programme.
If the Share Sub-Division is not approved by Shareholders, up to 22 million new
Shares, in aggregate, will be available to be issued pursuant to the Initial
Issue and the Issuance Programme (to be denominated as either Sterling Shares
or US Dollar Shares).
Prospectus
Further details will be set out in the Prospectus, which, once approved by the
FCA, and together with a Circular, is expected to be available shortly (subject
to certain access restrictions), on the Company's website at www.bhmacro.com.
The Company will release a further announcement upon the publication of the
Prospectus.
Once published, a copy of the Prospectus will be submitted to the National
Storage Mechanism and will be available for inspection at https://
data.fca.org.uk/#/nsm/nationalstoragemechanism.
Application for admission
Application will be made to the FCA and London Stock Exchange plc for the
Shares to be issued pursuant to the Initial Issue to be admitted to the premium
segment of the Official List of the FCA and to trading on London Stock Exchange
plc's Main Market for listed securities ("Initial Admission"). It is expected
that Initial Admission will become effective, and dealings commence in respect
of the Shares issued in the Initial Issue, at 8.00 a.m. on or around 15
February 2023.
Share Sub-division
The Share Sub-Division is subject to Shareholder approval at the Extraordinary
General Meeting by way of special resolution (the "Sub-Division Resolution")
and is conditional upon the sub-divided Shares issued pursuant to the Share
Sub-Division being admitted to the premium listing segment of the Official List
of the FCA and to trading on London Stock Exchange plc's Main Market for listed
securities (the "Sub-Division Admission").
If approved by Shareholders, the Share Sub-Division would result in
Shareholders holding ten new Shares for each existing Share they hold
immediately prior to the Share Sub-Division. The new Shares of each class will
carry the same rights in all respects as the existing Shares of the same class,
including voting rights. The Share Sub-Division should have no impact on the
Company's net assets as no change in the total aggregate value of the Company's
shares will occur.
Assuming that the Share Sub-Division is effective, the ticker symbols for the
Sterling Shares and the US Dollar Shares will remain as BHMG and BHMU
respectively, but the ISIN and SEDOL for the sub-divided Shares will change as
follows:
ISIN for the sub-divided Sterling Shares: GG00BQBFY362
ISIN for the sub-divided US Dollar Shares: GG00BQBFY479
SEDOL for the sub-divided Sterling Shares: BQBFY36
SEDOL for the sub-divided US Dollar Shares: BQBFY47
Assuming that the Share Sub-Division resolution is passed, the Share
Sub-Division will become effective at Sub-Division Admission, which is expected
to take place at 8.00 a.m. on 7 February 2023. Application will be made for
admission of the sub-divided Shares to the premium listing segment of the
Official List of the FCA and to trading on London Stock Exchange plc's Main
Market for listed securities. It is anticipated that the last day of dealings
in existing Shares will be 6 February 2023 with the record date for the Share
Sub-Division being 6.00 p.m. on that date. The effective date for dealings to
commence in the sub-divided Shares will be 7 February 2023.
Extraordinary General Meeting and Circular to Shareholders
The Shares issued under the Initial Issue and the Issuance Programme will be
offered on a non-pre-emptive basis and the Sub-Division is subject to
Shareholder approval. Accordingly, the Company has today published and posted
to Shareholders an explanatory circular (the "Circular") containing a notice
convening an extraordinary general meeting to be held at the offices of
Northern Trust International Fund Administration Services (Guernsey) Limited,
Trafalgar Court, Les Banques, St Peter Port, Guernsey at 8.30 a.m. on 6
February 2023 (the "Extraordinary General Meeting").
Shareholder approval will be sought at the Extraordinary General meeting for
the allotment and issue of the Shares to be issued under the Initial Issue and
the Issuance Programme by way of an ordinary resolution and the disapplication
of the pre-emption rights contained in the Company's articles of incorporation
in respect of such Shares by way of a special resolution (the "Issuance
Resolutions"). Approval of the Sub-Division by way of special resolution will
also be proposed at the Extraordinary General Meeting.
The Initial Issue and each subsequent issue under the Issuance Programme is
conditional upon approval of the Issuance Resolutions at the Extraordinary
General Meeting but is not conditional upon the Sub-Division Resolution being
approved.
A copy of the Circular will be submitted to the National Storage Mechanism and
will be available for inspection at https://data.fca.org.uk/#/nsm/
nationalstoragemechanism.
Amendments to the Management Agreement and the terms of the Company's
investment in the Master Fund
In order to reflect the increased investment of the Company in the Master Fund
as a result of the Initial Issue and the Issuance Programme and the fact that
the Company will become an even more significant feeder fund into the Master
Fund, the Company and the Manager have agreed to a number of amendments to the
Management Agreement and the terms on which the Company's investment in the
Master Fund can be redeemed in order to provide the Manager with more
operational certainty regarding the Company's investment in the Master Fund.
These changes, which do not require Shareholder approval, are described in
further detail in the Circular.
The main changes and their effect are as follows:
· The Company will ordinarily be required to provide 12 months' notice of
the redemption of all or some of its investment in the Master Fund, except as
may be required to fund the Company's specific working capital requirements
and, up to a maximum amount equal to five per cent. of each class of the
Company's holding of Master Fund shares every month, to finance on-market share
buy backs. Any redemption of all or part of the Company's investment in the
Master Fund on a winding up of the Company or to finance a tender offer or a
class closure resolution will be required to be on 12 months' notice. In those
cases, the Company would only receive the proceeds of redemption from the
Master Fund (and, therefore, Shareholders would only receive payment from the
Company) after the redemption date at the end of the 12 month notice period and
the Company (and, therefore, Shareholders) would remain exposed to the
investment performance of the Master Fund in the intervening period to that
redemption date.
· The circumstances in which the Company can terminate the Management
Agreement and redeem its investment in the Master Fund on less than 12 months'
notice will be limited to certain "cause" events affecting the Manager, in
which case the Company would be entitled to terminate the Management Agreement
and redeem its investment in the Master Fund on three months' notice.
· In addition, the annual buy back allowance arrangements introduced in 2021
will continue to apply in respect of repurchases and redemptions of shares of
each class in excess of five per cent. of the relevant class in any calendar
year, as described further in the Circular.
The Directors believe that these changes are in the interests in the Company,
given that they will help facilitate the Initial Issue and the Issuance
Programme, and that the Initial Issue and the Issuance Programme should benefit
the Company through a significant increase in its market capitalisation and
potential increase in the liquidity of the Shares.
Background on the Company
BH Macro Limited is an authorised closed-ended collective investment scheme
established as a non-cellular company limited by shares under the laws of
Guernsey on 17 January 2007. The Company's ordinary shares were first admitted
to listing on London Stock Exchange on 14 March 2007.
The Company's Sterling Shares and US Dollar Shares are listed on the premium
segment of London Stock Exchange plc's Main Market for listed securities. Until
2017, the Company also had a class of Euro-denominated shares listed on the
premium segment of the Main Market.
The Company is a feeder fund that invests all of its assets (net of short-term
working capital requirements) directly in the Master Fund, a hedge fund in the
form of a Cayman Islands open-ended investment company.
The investment objective of the Master Fund is to generate consistent long-term
appreciation through active leveraged trading and investment on a global basis.
The Master Fund has flexibility to invest in a wide range of instruments
including, but not limited to, debt securities and obligations (which may be
below investment grade), bank loans, listed and unlisted equities, other
collective investment schemes, currencies, commodities, futures, options,
warrants, swaps and other derivative instruments and digital assets. The
underlying philosophy is to construct strategies, often contingent in nature,
with superior risk/return profiles, whose outcome will often be crystallised by
an expected event occurring within a pre- determined period of time.
The Master Fund employs a combination of investment strategies that focus
primarily on economic change and monetary policy and market inefficiencies.
The Company is one of five feeder funds into the Master Fund and is the only
feeder fund that is publicly traded.
Both the Company and the Master Fund are managed by the Manager, acting through
its sole general partner, Brevan Howard Capital Management Limited.
Expected Timetable
Announcement of the Initial Issue 23 January 2023
Publication of the Prospectus and 23 January 2023
despatch of the EGM Circular to existing
Shareholders
Initial Placing, Intermediaries Offer and 23 January 2023
Offer for Subscription open
Latest time and date for receipt of forms 8.30 a.m. on 2 February 2023
of proxy in respect of the EGM
Extraordinary General Meeting 8.30 a.m. on 6 February 2023
Record date for the sub-division and 6.00 p.m. on 6 February 2023
disablement in CREST of the existing
Shares
Admission of new Shares issued pursuant 8.00 a.m. on 7 February 2023
to the Sub-division Resolution becoming
effective*
Latest time and date for receipt of 11.00 a.m. on 9 February 2023
completed Offer for Subscription
Application Forms and payment in full
under the Offer for Subscription and
settlement of relevant CREST instructions
(as appropriate)
Latest time and date for receipt of 11.00 a.m. on 9 February 2023
completed applications from
Intermediaries in respect of the
Intermediaries Offer
Latest time and date for receipt of 3.00 p.m. on 10 February 2023
commitments under the Initial Placing
Initial Closing Date 3.00 p.m. on 10 February 2023
Announcement of the results of the 13 February 2023
Initial Issue
Initial Admission and dealings in the 8.00 a.m. on 15 February 2023
Shares issued pursuant to the Initial
Issue commence
Crediting of CREST stock accounts in as soon as practicable on 15
respect of the Shares issued pursuant to February 2023
the Initial Issue and payment in full
under the Intermediaries Offer
Where applicable, definitive share Week commencing 20 February 2023
certificates despatched in respect of the (or as soon as possible
Shares** thereafter)
* Assuming that the Sub-division Resolution is passed at the Extraordinary
General Meeting and becomes effective.
** Underlying applications who apply to Intermediaries for Shares under the
Intermediaries Offer will not receive share certificates.
Enquiries
BH Macro
Richard Horlick
Chairman
J.P. Morgan Cazenove (Sole Bookrunner)
William Simmonds / Rupert Budge (Corporate Finance) Tel: +44 (0) 20 7742
4000
James Bouverat / Liam MacDonald-Raggett (Sales)
Kepler Partners LLP (Placing Agent & Intermediaries Offer Adviser)
Hugh van Cutsem Tel: +44 (0) 203 384 8796
Hugo Rynsard-Perry Tel: +44 (0) 203 598 6460
Important Notice
The information contained in this announcement is for background purposes only
and does not purport to be full or complete. No reliance may be placed by any
person for any purpose on the information contained in this announcement or its
accuracy, fairness or completeness.
Investors should not base any financial decision on this announcement.
Acquiring investments to which this announcement relates may expose an investor
to a significant risk of losing all of the amount invested. Persons considering
making investments should consult an authorised person specialising in advising
on such investments. This announcement does not constitute a recommendation
concerning the Shares. The value of shares can decrease as well as increase.
Potential investors should consult a professional advisor as to the suitability
of the Shares Option for the person concerned.
Nothing contained herein constitutes or should be construed as (i) investment,
tax, financial, accounting or legal advice (ii) a representation that any
investment or strategy is suitable or appropriate to individual circumstances
or (iii) a personal recommendation.
J.P. Morgan Securities plc, which conducts its UK investment banking activities
as J.P. Morgan Cazenove ("JPMC"), which is authorised by the Prudential
Regulation Authority and regulated by the Prudential Regulation Authority and
the FCA in the United Kingdom, is acting exclusively for the Company and no-one
else in connection with the Initial Issue and the Issuance Programme and the
Issue and will not be responsible to anyone other than the Company for
providing the protections afforded to customers of JPMC or for providing advice
in relation to the Initial Issue and the Issuance Programme, 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 or to any US Person, Australia, Canada, Japan, New
Zealand, the Republic of South Africa, any European Economic Area state or any
other jurisdiction in which its distribution may be unlawful. A "US Person" is
any person who is not a "Non-United States Person" as defined in US Commodity
Futures Trading Commission Rule 4.7. 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.
None of the Company, the Manager or JPMC or any of their respective affiliates
accepts any responsibility or liability whatsoever for/or makes any
representation or warranty, express or implied, as to this announcement,
including the truth, accuracy or completeness of the information in this
announcement (or whether any information has been omitted from the
announcement) or any other information relating to the Company whether written,
oral or in a visual or electronic form, and howsoever transmitted or made
available or for any loss howsoever arising from any use of this announcement
or its contents or otherwise arising in connection therewith. The Company, the
Manager, JPMC and their respective affiliates accordingly disclaim all and any
liability whether arising in tort, contract or otherwise which they might
otherwise have in respect of this announcement or its contents or otherwise
arising in connection therewith.
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", "forecasts", "projects", "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 and are not guarantees of
future performance. Accordingly, there are or will be important factors that
could cause the Company's actual results of operations, performance or
achievement or industry results to differ materially from those indicated in
these statements. Any forward-looking statements in this announcement reflect
the Company's 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, growth strategy and liquidity. Given these
uncertainties, prospective investors are cautioned not to place any undue
reliance on such forward-looking statements. These forward-looking statements
apply only as of the date of this announcement.
Information to distributors
Solely for the purposes of the product governance requirements contained
within: (a) EU Directive 2014/65/EU on markets in financial instruments, as
amended ("Directive 2014/65/EU"); (b) Articles 9 and 10 of Commission Delegated
Directive (EU) 2017/593 supplementing Directive 2014/65/EU; (c) local
implementing measures; and/or (d) (where applicable to UK investors or UK
firms) the relevant provisions of the UK MiFID Laws (together the "MiFID II
Product Governance Requirements"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any "manufacturer" (for
the purposes of the MiFID II Product Governance Requirements) may otherwise
have with respect thereto, the Shares have been subject to a product approval
process, which has determined that the Shares are: (i) compatible with an end
target market of retail investors and investors who meet the criteria of
professional clients and eligible counterparties, each as defined in Directive
2014/65/EU or the UK MiFID Laws (as applicable) and (ii) eligible for
distribution through all distribution channels as are permitted by Directive
2014/65/EU or the UK MiFID Laws, as applicable (the "Target Market
Assessment").
Notwithstanding the Target Market Assessment, distributors should note that:
the price of the Shares may decline and investors could lose all or part of
their investment; the Shares offer no guaranteed income and no capital
protection; and an investment in the Shares is compatible only with investors
who do not need a guaranteed income or capital protection, who (either alone or
in conjunction with an appropriate financial or other adviser) are capable of
evaluating the merits and risk of such an investment and who have sufficient
resources to be able to bear any losses that may result therefrom. The Target
Market Assessment is without prejudice to the requirements of any contractual,
legal or regulatory selling restrictions in relation to the Initial Issue.
Furthermore, it is noted that, notwithstanding any Target Market Assessment,
JPMC will, pursuant to the Initial Placing, only procure placees who meet the
criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute:
(a) an assessment of suitability or appropriateness for the purposes of
Directive 2014/65/EU or the UK MiFID Laws (as applicable); or (b) a
recommendation to any investors or group of investors to invest in, or
purchase, or take any other action whatsoever with respect to the Shares.
Each distributor is responsible for undertaking its own Target Market
Assessment in respect of the Shares and determining appropriate distribution
channels.
PRIIPs Regulation
In accordance with the UK version of the Regulation (EU) No 1286/2014 of the
European Parliament and of the Council of 26 November 2014 on key information
documents for packaged retail and insurance-based investment products (PRIIPs)
and related legislation (the "UK PRIIPs Laws"), key information documents in
respect of an investment in the Sterling Shares and the US Dollar Shares have
been prepared by the Manager and are available to investors at www.bhmacro.com.
If you are distributing the Shares, it is your responsibility to ensure that
the key information document relating to the relevant class of Shares is
provided to any clients that are "retail clients". The Company is the only
manufacturer of the Shares for the purposes of the UK PRIIPs Laws or the PRIIPs
Regulation and JPMC is not a manufacturer for these purposes. JPMC does not
make any representation, express or implied, or accept any responsibility
whatsoever for the contents of any key information documents prepared by the
Manager nor accept any responsibility to update the contents of any key
information documents in accordance with the UK PRIIPs Laws or the PRIIPs
Regulation, to undertake any review processes in relation thereto or to provide
such key information documents to future distributors of Shares. JPMC and its
affiliates accordingly disclaim all and any liability whether arising in tort
or contract or otherwise which it or they might have in respect of any key
information documents prepared by the Manager.
END
(END) Dow Jones Newswires
January 23, 2023 03:02 ET (08:02 GMT)
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