28 January 2025

LEI: 213800LFMHKVNTZ7GV45

AssetCo plc ("AssetCo" or the "Company")

PROPOSED SHARE REORGANISATION, NOTICE OF GENERAL MEETING

AND NOTICE OF RESULTS

The Board of AssetCo is pleased to announce proposals for a share reorganisation which will better represent the key elements of the Company's two principal existing business interests, River Global and Parmenion. The Company intends to issue a circular to shareholders today ("Circular") proposing:

(i)            the reorganisation of the Company's share capital by sub-dividing and reclassifying the Company's Existing Ordinary Shares into New A Ordinary Shares and New B Shares (the Share Reorganisation);

(ii)           that the Company seek admission to trading on AIM in respect of both the New A Ordinary Shares and the New B Shares;

(iii)          that in order to implement the Share Reorganisation the Company adopt Amended Articles; and

(iv)          that the Company change its name to River Global PLC.

Full details of the proposed Share Reorganisation together with an update on the Company's trading are set out below and in the Circular that will shortly be sent to shareholders. The Share Reorganisation is subject to shareholder approval which will be sought at a general meeting of the Company to be held at 10.00 am on 6 March 2025 at Shoosmiths LLP, 1 Bow Churchyard, London, EC4M 9DQ.   

Martin Gilbert, Executive Chairman of AssetCo, commented: "The Share Reorganisation will benefit the Company and Shareholders as the new share structure better reflects the value proposition of the Company's two separate and distinct business interests, River Global and Parmenion. It is anticipated that this will enable a more consistent valuation of the Company in the mid-term as well as making the Company's shares more attractive. The Directors unanimously recommend that you vote in favour of the Resolutions being proposed at the General Meeting."

Notice of Results

The Company gives notice that it will be announcing its full year results for the year ended 30 September 2024 on, or around, Wednesday 5 March 2025.

For further information, please contact:

For further details, visit the website, www.assetco.com

Ticker: AIM: ASTO.L

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

KEY STATISTICS

All references to times and dates in this announcement are to London time. Each of the times and dates in this announcement is subject to change. If any of the above times and/or dates change, the revised time and/or date will be notified to Shareholders through a regulatory information service.

DEFINITIONS

In this announcement and in the accompanying Circular and Form of Proxy, the following words and expressions shall, except where the context requires otherwise, have the following meanings:

PROPOSED SHARE REORGANISATION AND CHANGE OF NAME

1.         INTRODUCTION

The Company is proposing to:

(i)         implement a reorganisation of its share capital by sub-dividing and reclassifying the Company's Existing Ordinary Shares into New A Ordinary Shares and New B Shares (the "Share Reorganisation") pursuant to Resolution 1 in the Notice of the General Meeting;

(ii)        seek admission to trading on AIM in respect of the New A Ordinary Shares;

(iii)       seek admission to trading on AIM in respect of the New B Shares;

(iv)       adopt the Amended Articles pursuant to Resolution 2 in the Notice of General Meeting; and

(v)        change the name of the Company to River Global PLC pursuant to a proposed meeting of the Company's Board.

The purpose of the Circular is to provide you with information about the background to, and reasons for, the proposed Share Reorganisation and Change of Name, to explain why the Board considers the Share Reorganisation and Change of Name to be in the best interests of the Company and its Shareholders as a whole, and why the Directors recommend that you vote in favour of the Resolutions to be proposed at the General Meeting, notice of which will shortly be sent to Shareholders.

Upon implementation of the Share Reorganisation, Shareholders on the register of members of the Company on the Record Date, which is expected to be at 6 p.m. on 4 March 2025, will receive one New A Ordinary Share and one New B Share for every Existing Ordinary Share they hold. For context, as at 27 January 2025 (being the latest practicable date prior to the publication of the Circular), the Company had 149,292,970 ordinary shares of £0.01 each in issue.

2.         BACKGROUND TO AND REASONS FOR THE PROPOSED SHARE REORGANISATION AND CHANGE OF NAME

The Company is primarily involved in acquiring, managing and operating asset and wealth management activities and interests, together with other related services. The strategy has principally focused on making strategic acquisitions and building organic activities in areas of the asset and wealth management sector where structural shifts have the potential to deliver exceptional growth opportunities.

On 1 July 2021, the Company announced that it had reached agreement to acquire a 30% structured equity interest (subject to adjustment from time to time) in Parmenion (the Acquisition), a discretionary investment manager and advisory platform for the wealth and financial planning sector, from Preservation. The agreed consideration was up to £27.8 million, of which £20.6 million was to be paid on completion and up to £3.6 million in each of March 2022 and March 2023, contingent on the performance of Parmenion.

The Acquisition of the interest was conditional on approval by the FCA to the change in controller, which was duly received.

On 1 October 2021 the Company completed the Acquisition and paid Preservation £20.6 million. In addition to the consideration, the Company paid a further £1.3 million to reflect their pro ratashare of the costs incurred by Preservation in the acquisition of Parmenion, together with interest on the initial consideration from 1 July 2021. The consideration for the Acquisition has now been paid in full and the Company does not intend to increase its interest in Parmenion.

In June 2022, following the Parmenion Acquisition, the Company acquired the active equities asset management business of River Global (formerly known as River and Mercantile). This acquisition provided a platform to consolidate the Saracen and Revera equities businesses which had been acquired prior to this, along with subsequent equities business acquisitions, SVM Investment Management and Ocean Dial Asset Management. Additional acquisitions (indirect and direct respectively) included Infrastructure and ETF businesses, both of which have now been exited.

Over the past eighteen months the Company's business interests have been simplified considerably and now comprise (i) the wholly owned equities business, trading under the name 'River Global' and (ii) its structured equity interest in Parmenion. The Board believes that the factors driving value in these two lines of business differ significantly in terms of both quantum and the timing of any distribution and that, as a result, they have the potential to appeal to quite different types of investors. To fully realise the benefit that might result from allowing new and existing investors to access these different value profiles directly, and subject to receiving the requisite Shareholder approval, the Board has proposed the Share Reorganisation with the New A Ordinary Shares representing the Company's economic interest in its principal equities investment management business which is primarily conducted through the River Global brand, and the New B Shares representing the Company's economic interest in Parmenion. The New A Ordinary Shares will have full participation rights other than in respect of the economic interest in Parmenion, whilst the New B Shares will have limited voting rights and are limited to receiving the economic benefits of the Parmenion holding.

The Board believes that the Share Reorganisation will benefit the Company and Shareholders as the new share structure better reflects the value proposition of the Company's two separate and distinct businesses. It is anticipated that this will enable a more consistent valuation of the Company in the mid-term as well as making the Company's shares more attractive to institutional shareholders in connection with the proposed Admission and the trading of the New B Shares on AIM. The Share Reorganisation will enable a clear division of the economic rights attached to the New A Ordinary Shares and the New B Shares, such that existing Shareholders and prospective investors who would like to invest in the principal equities investment management business can do so exclusively by virtue of holding the New A Ordinary Shares, whilst existing Shareholders and prospective investors who would like to focus on the Parmenion business can do so by virtue of holding the New B Shares.

The Board therefore believes that the proposed Share Reorganisation will better cater to the respective risk appetites of existing Shareholders and prospective investors. As the New A Ordinary Shares will reflect the economic interest in the Company's principal equities investment management business, the Board has proposed that the Company changes its name to River Global PLC to better align the interests of the A Ordinary shareholders with the underlying equities business. This change will be effected by a resolution of the Company's board of directors, immediately after the General Meeting and subject to the Resolutions being passed.

3.         FINANCIAL INTERESTS OF THE NEW A ORDINARY SHARES AND THE NEW B SHARES

The holders of the New A Ordinary Shares will be entitled to all of the Company's economic interests as at present but excepting those attributable to the New B Shares as set out below. A trading update on the business is set out in section 9 below.

As stated above the holders of the New B Shares will be entitled to the benefits of the Company's economic interest in Parmenion. The Parmenion interest consists of two component parts:

•          a 30% equity shareholding in a Guernsey domiciled holding company "Shillay TopCo Limited" which was established for the purpose of buying and holding the entire equity shareholding in Parmenion on behalf of its shareholders; and

•          loan notes held in "Shillay MidCo Limited" a Guernsey domiciled company and a wholly owned subsidiary of Shillay TopCo Limited.

Parmenion is wholly owned by Shillay MidCo Limited and hence by Shillay TopCo Limited. The loan notes held in Shillay MidCo Limited were £21.7m at completion of the Acquisition in October 2021, of which £21.5m attracts interest at 10% per annum. The interest currently accumulates in the form of additional loan notes. The amount of loan notes stood at £27.1m as at 30 September 2024.

The holders of the New B Shares will be entitled (in aggregate) to both components of the Company's current economic interest in Parmenion as outlined above, as well as any future dividends or capital return received in respect of that economic interest and the future interest (whether paid in additional loan notes or in cash). It should be noted that the Company's 30% equity shareholding in Parmenion may be diluted immediately prior to a sale as a result of the management incentive scheme in place for Parmenion's management team, which entitles them to a proportion of the equity to the extent that the realised value for the Parmenion business exceeds certain targets.

The ongoing costs directly attributable to maintaining and operating the interest in Parmenion (which will be linked to the New B Shares following the Share Reorganisation), together with a reasonable proportion of the central overheads of the Company, will be accrued to be set off against any realisable value of the Company's interest in the Parmenion shareholding in the event of a sale or other return of capital. The costs of effecting any transaction in respect of the interest will also be held against its realisable value.

Pro-Forma Impact of Proposed Share Reorganisation

The following tables show the expected impact of the proposed Share Reorganisation on the Financial Statements of AssetCo PLC (to be renamed River Global PLC).

Financial information on the proposed share classes, the New A Ordinary Shares and the New B Shares will be provided within the Segmental Reporting section of the Financial Statements of AssetCo PLC (to be renamed River Global PLC). The tables below are provided for illustration purposes only and may be subject to revision when presented in the Financial Statements of the Group for the year ended 30 September 2024.

Restated, Unaudited Analysis of Revenue and Results by Commercial Activity and Share Rights:

For the six months ended 31 March 2024

New            Combined

New Ordinary A Shares                                 B Shares       Share Classes

4.         DETAILS OF THE PROPOSED SHARE REORGANISATION

Upon implementation of the Share Reorganisation, Shareholders on the register of members of the Company on the Record Date, which is expected to be at 6 p.m. on 4 March 2025, will receive one New A Ordinary Share and one New B Share for every Existing Ordinary Share they hold. The proportion of the issued ordinary share capital of the Company held by each Shareholder following the Share Reorganisation will remain unchanged.

Other than the change to nominal value, the New A Ordinary Shares arising out of the Share Reorganisation will have the same rights as the Existing Ordinary Shares subject to the interests of the New B Shares. The New B Shares will be different as to nominal value, voting and dividends from the Existing Ordinary Shares. If dividends are declared in respect of the Company's economic interests in Parmenion or if there is a capital distribution as a result of the sale of the whole or a part of the interest in Parmenion, then shareholders of the New B Shares will receive either dividends or capital distribution (as appropriate) after deduction of any costs attributable to the New B Shares interest. It should be noted that dividends will only be paid subject to the Company as a whole having sufficient distributable reserves.

If dividends are declared in respect of the Company's principal equities investment management business, primarily trading under the River Global brand, then these dividends will be declared in respect of shareholders holding the New A Ordinary Shares. The New B Shares will have no voting rights, save in respect of issues affecting the interest of the class of New B Shares, as defined in the Amended Articles. Neither the New A Ordinary Shares nor the New B Shares will be redeemable. It should be noted that dividends will only be paid subject to the Company as a whole having sufficient distributable reserves.

If you hold a share certificate in respect of your Existing Ordinary Shares in the Company, your certificate will no longer be valid from the time the proposed Share Reorganisation becomes effective. On the Record Date, all shareholders holding Existing Ordinary Shares in certificated form will be sent new share certificates evidencing the New A Ordinary Shares and New B Shares to which they are entitled under the Share Reorganisation. Such certificates are expected to be despatched no later than week commencing 12 March 2025. The certificates will be despatched by first class post, at the risk of the Shareholder. Upon receipt of the new certificates, you should destroy any old certificates. Pending the despatch of the new certificates, transfers of certificated New A Ordinary Shares and New B Shares will be certified against the Company's share register.

If you hold your Existing Ordinary Shares in uncertificated form, you should expect to have your CREST account credited with the New A Ordinary Shares and New B Shares to which you are entitled on implementation of the Share Reorganisation on 12 March 2025 or as soon as practicable after the Share Reorganisation becomes effective.

Following the Share Reorganisation and Change of Name, the Company's new SEDOL codes will be BTDR2R1 (in respect of the New A Ordinary Shares) and BTDR2S2 (in respect of the New B Shares) and its new ISIN codes will be GB00BTDR2R10 (in respect of the New A Ordinary Shares) and GB00BTDR2S27 (in respect of the New B Shares). The Company's TIDM will change from ASTO to RVRG in respect of the New A Ordinary Shares and from ASTO to RVRB in respect of the New B Shares.

5.         DETAILS OF THE AMENDED ARTICLES

In order to give effect to the Share Reorganisation, the Company needs to adopt the Amended Articles to cater for new rights being granted to the New A Ordinary Shares and New B Shares. It is proposed that the existing articles of association of the Company be amended and replaced by the Amended Articles to reflect the Share Reorganisation and to provide for a clear delineation of the attachment of different economic interests to the New A Ordinary Shares and the New B Shares.

A short summary of the proposed changes is set out below and a full copy of the Amended Articles is contained at the end of the Circular. Shareholders are advised to read the new Amended Articles in full and seek the appropriate advice on the impact of the changes therein:

1.         The inclusion of new definitions for:

•          "AIM";

•          "A Ordinary Shares";

•          "B Shares"; and

•          "Parmenion",

in the interpretation section of the Articles.

2.         The amendment of the definition of "Ordinary Shares".

3.         Pre-emption rights would apply on the allotment of new shares and it is envisaged that if New A Ordinary Shares were to be allotted, only the holders of New A Ordinary Shares would participate and vice versa with the New B Shares.

4.         The inclusion of Article 10 ("Voting rights attached to Shares") which provides that the New A Ordinary Shares will have full voting rights attached to them, whereas New B Shares will be non- voting save in respect of matters affecting the class.

5.         The amendment of Article 11 ("Variation of rights") which requires that the rights attached to New Shares cannot be varied or abrogated to prevent:

a.         the voting rights in Article 10 being amended;

b.         the New A Ordinary Shares from being detached from the economic value of the principal equities investment management business; and

c.         the New B Shares from being detached from the economic value of Company's interest in Parmenion,

in each case, without the requisite consents being obtained.

6.         The amendment of Article 120 ("Declaration of dividends") to provide that any dividends declared to holders of:

a.         New A Ordinary Shares will be dictated by any distributable profits being generated by the Company's principal equities investment management business, subject to the Company as a whole having distributable reserves; and

b.         New B Shares will be dictated by any distributable profits being generated by the Company's interest in the Parmenion business. It should be noted that dividends will only be paid subject to the Company as a whole having sufficient distributable reserves.

It should be noted that in either case, dividends will only be paid subject to the Company as a whole having sufficient distributable reserves.

7.         The amendment of Article 121 ("Interim dividends") to provide that any interim dividends declared to holders of:

a.         New A Ordinary Shares will be dictated by any distributable profits being generated by the Company's principal equities investment management business; and

b.         New B Shares will be dictated by any distributable profits being generated by the Company's interest in the Parmenion business.

It should be noted that in either case, dividends will only be paid subject to the Company as a whole having sufficient distributable reserves.

8.         The inclusion of a new Article 140, to provide that in the event that there are any capital distributions following a sale or partial sale of:

a.         the Company's mainstream equities investment management business then all proceeds following the deduction of any transaction costs shall be payable to the holders of the New A Ordinary Shares and the holders of the New B Shares shall not be entitled to any such proceeds; and

b.         the Company's interest in the Parmenion business then all proceeds following the deduction of any transaction costs and any ongoing costs of maintaining the New B Shares will be payable to the holders of the New B Shares and the holders of the New A Ordinary Shares shall not be entitled to any such proceeds.

6.         ADMISSION TO AIM

The Company will continue to remain subject to the following legal and regulatory requirements:

1.         Shareholders will be required to comply with their disclosure obligations under AIM Rule 17;

2.         the Company will still be subject to the UK MAR regulating inside information; and

3.         the UK City Code on Takeovers and Mergers (the "Code") will continue to apply to the Company.

7.         EFFECTS OF THE PROPOSED SHARE REORGANISATION ON RESTRICTED SHARE PLANS

Under the rules of the Restricted Share Plans, the Remuneration Committee of the Board has the discretion to adjust the structure of the shares awarded under the Restricted Share Plans to reflect the impact of the Share Reorganisation, which it intends to do to seek to preserve the economic interest of participants.

The Company will provide further communications to participants under separate communication.

8.         AIM AND DISCLOSURE REGULATORY REGIME

The combination of the quotation on AIM of the New A Ordinary Shares and the New B Shares will provide Shareholders and prospective investors easier access to liquidity for the particular economic interest they wish to trade as currently potential investors may be discouraged from acquiring shares which encompass the economic interests in both the Company's principal equities investment management business and the Company's interest in the Parmenion business.

The principal regulatory regime for the Company encompasses the AIM Rules, UK MAR and the DTRs. Under the AIM Rules, the Company, is at all times required to have a 'nominated adviser' (as defined in the AIM Rules) to advise and guide it on its responsibilities under the AIM Rules. The nominated adviser to the Company is responsible to the LSE for advice and guidance on its responsibilities under the AIM Rules and for ensuring that announcements and documents required to be made under the AIM Rules are made and are made on a timely basis. As such the AIM market is a 'self-regulated' market, in contrast to the Main Market of the LSE.

Pursuant to Rule 17 of the AIM Rules, an AIM company which is UK incorporated is also required to comply with DTR 5 (Vote Holder and Issuer Notification Rules).

UK Takeover Code

The Company is subject to the Code given that it is UK-incorporated with its place of central management and control being in the UK. Following Admission, the Code continues to apply to the Company and, as a result, Shareholders are entitled to the benefit of the takeover offer protections provided under the Code.

Under Rule 9 of the Code ("Rule 9"), if an acquisition, or a series of acquisitions over a period of time, of an interest in the New A Ordinary Shares was to increase the aggregate holding of the acquirer and its concert parties to shares carrying 30 per cent. or more of the voting rights in the Company, the acquirer and, depending on the circumstances, its concert parties, would be required (except with the consent of the Takeover Panel) to make a cash offer for the outstanding New A Ordinary Shares at a price not less than the highest price paid for the New A Ordinary Shares by the acquirer or its concert parties during the previous 12 months. This requirement would also be triggered by any acquisition of New A Ordinary Shares by a person holding (together with its concert parties) New A Ordinary Shares carrying between 30 and 50 per cent. of the voting rights in the Company if the effect of such acquisition were to increase that person's percentage of the voting rights. In respect of the New B Shares, as they are non-voting shares, Rule 9 of the Code does not apply to this class of share, meaning a shareholder may acquire over 30% of the New B Shares without triggering the requirement to make a mandatory bid for the New B Shares.

Shareholders should also note that as the Company has more than one class of share capital Rule 14 of the Code ("Rule 14") applies. Specifically, Shareholders should be aware that under Rule 14.1 (a) where an offer is made for the New A Ordinary Shares a comparable offer must be made for the New B Shares. Furthermore, should a voluntary offer be made for the New B Shares only, then Note 2 on Rule 14.1 would apply such that a comparable offer for the New A Ordinary Shares is not expected to be required. In both instances, the Takeover Panel would need to be consulted in advance.

9.         TRADING UPDATE

Assets under management increased from the £2,372 million reported at the end of June to £2,779 million as at the end of September 2024. This includes the over £100m new business win reported into the Company's UK Opportunities Fund (an open-ended collective investment scheme managed and marketed by the Company) in June 2024, which funded over the course of May 2024. It also includes the successful launch of one of the two joint ventures we referenced in June 2024, being the initiative to bring a leading fund manager to market.

Unaudited results for the year ended 30 September 2024 show an operating loss of £2.9m (after adjusting for discontinued operations and exceptional items) and an overall loss of £4.0m. This result (which remains subject to adjustment as part of the year end audit process) keeps us on track with the trajectory we had previously outlined towards run rate profitability.

Nearly €400m was added to the Group's assets under management in a fund raising to mark commencement of the joint venture referenced above. Founder clients invested in two former River Global badged funds now managed by Jonathan Knowles, previously one of the top equity fund managers for Capital International Group - one of the largest asset managers in the world. The revenue share for River Global in respect of the initial founder assets is relatively small but arrangements for future third party funds are expected to be more remunerative. Given that Jonathan Knowles and supporting employees of his firm, Compound Equity Group, operate under the existing River Global regulatory and operational framework to manage what were previously small, unprofitable funds, the arrangement capitalises on existing infrastructure and is revenue enhancing from outset.

Overall, flows for the River Global group to the end of September 2024 remained positive from the last reporting period to the end of March 2024, and markets also contributed positively.

The Group was notified in October that it had been appointed to manage a substantial mandate for a UK institution with funding for that mandate due to take place in March 2025. This win was not included in our budget planning and would therefore have made a positive contribution in the year ahead. Unfortunately, however, the Group was terminated as manager in December by a US institution for whom the Group has managed two portfolios for some six years. The assets under management (c.£200m) and revenues (c.£1m) relating to the UK and US institutions essentially offset each other leaving the Group no worse but no better off on an on-going basis as a result.

Elsewhere, headwinds continue to batter the active equity asset management industry with some £16bn in outflows from UK Equity fund products alone in the year to end November. The Group is not immune to this and has seen some £193m of additional outflows in the first quarter of the new financial year which requires further management action in order to keep us on the track towards profitability that we signalled above. The Company's project to consolidate back-office service providers has been delayed somewhat from the target the Company had set to deliver around its financial year end but is otherwise progressing well and is now expected to deliver in the first quarter of the 2025 calendar year. The synergies associated with that project remain on track albeit with a later starting point.

Parmenion acquired EBI Portfolios Ltd in September 2022 and together the two companies had assets under management or advice of £11.7bn as at 31 March 2024 which compares favourably to £10.6bn at the same time in the previous year. Operating profit for the combined businesses was £15.5m at their December 2023 year end which again compares favourably to the previous year's result of £11.9m. Revenue generated by the combined businesses over the year to end December 2023 amounted to £48.6m. Overall, EBITDA more than tripled in the three years to end December 2023.

Parmenion continues to garner awards from across the spectrum of investment platform providers, including "Best model portfolio service 2024" (for its EBI business) at the Professional Adviser Awards 2024 and first place in 6 out of 11 categories in the Defaqto platform service review 2024. It is Defaqto 5 Star rated and Defaqto Gold Service rated amongst 20 Defaqto ratings covering all aspects of its business.

Parmenion serviced 1570 financial advisory firms as at end December 2023 and continues to add functionality to its proprietary technology, importantly adding a new Platform Switch Service in 2023 which facilitates the process of transitioning to Parmenion for financial advisory firms,

More generally, Panmure noted in a research note published in October 2023 that "the attractions of the long-term structural growth opportunities in the investment platform market remain. The addressable market remains vast, at c.£3trn and growing, with penetration of said market around 31%, leaving plenty to go for. Structural trends, including an ageing population and regulatory change, are encouraging saving as the burden of responsibility for saving for retirement shifts from employer to employee. Given the number of structural growth drivers, savings products, such as ISAs, remain popular, and SIPPs are growing in number due to the flexibility they provide. As the popularity of these products grows, so does that of the investment platforms, key providers of these products to the wider UK market."

In September 2023, we responded to speculation around the value of our structured 30% equity interest (before dilution for management interests) in Parmenion, obtaining an independent valuation of that interest showing a value of between £75-90m. Based on recent discussions with the Company's advisers, the Board believes that this continues to represent a fair assessment of the value of the Company's interest assuming an arm's length sale of the company as a whole.

10.      CHANGE OF NAME, ADMISSION, SETTLEMENT AND DEALINGS

On 16 January 2025, the Company held a Board meeting at which it voted to change the name of the Company from AssetCo PLC to River Global PLC, which will only become effective upon completion of the Share Reorganisation. The name change to River Global PLC will be reflected in the applications to the London Stock Exchange for the purposes of Admission.

Application will be made to the London Stock Exchange for the New A Ordinary Shares to be admitted to trading on AIM. It is expected that Admission will become effective, and that dealings in the New A Ordinary Shares will commence on AIM, at 8.00 a.m. on 12 March 2025 whereupon the Share Reorganisation will become effective.

Application will also be made to the London Stock Exchange for the New B Shares to be admitted to trading on AIM. It is expected that Admission will become effective, and that dealings in the New B Shares will commence on AIM, at 8.00 a.m. on 12 March 2025 whereupon the Share Reorganisation will become effective.

11.      RISK FACTORS

The Directors consider the following risks should be considered by Shareholders prior to deciding how to cast their votes at the General Meeting:

(a)        Both the New A Ordinary Shares and the New B Shares are expected to be relatively illiquid. AIM is a market designed primarily for smaller companies, to which a higher investment risk tends to be attached than for larger companies trading on the Main Market of the LSE and may not provide the liquidity normally associated with the Main Market of the LSE, or on some other stock exchanges. Accordingly, as a consequence of the Company's New A Ordinary Shares and the New B Shares trading on AIM, they may be more difficult to sell compared with shares listed on the Main Market of the LSE.

(b)       If there are no distributable reserves available to the Company, then Shareholders and prospective investors should note that no dividends or capital distribution will be declared in respect of either the New A Ordinary Shares or the New B Shares.

(c)        The shareholder agreement that governs the relationship between the Company and Preservation in respect of the Company's economic interest in Parmenion confers a number of restrictions and obligations on the parties which limit the Company's ability to dispose of its interest in certain circumstances.

(d)       The New B shares represent a structured equity interest in the business of Parmenion (as outlined at paragraph 2 above) which is a private company not itself listed on a public market. The Company intends to undertake a yearly independent third-party valuation and a half yearly review of valuation. Given the illiquid nature and limited rights the Company has in respect of any sale of Parmenion, the valuation obtained may be significantly different from that that may be achieved in any sale.

(e)       Parmenion is a private company and information regarding the progress of its business is limited and also restricted by the shareholder agreement referred to in (c) above. Shareholders should not expect to receive any more information, in the event of the Share Reorganisation proceeding, than is currently available.

(f)        The price of the New B Shares, as well as the New A Ordinary Shares, and the income derived from them, can go down as well as up. Past performance is not necessarily a guide to the future. Changes in economic conditions including, for example, interest rates, rates of inflation, industry conditions, competition, political and diplomatic events and trends, tax laws and other factors can substantially and adversely affect equity investments and the Company's prospects. In particular, potential investors should be aware of market volatilities attributable to political conflicts impacting share prices generally.

(g)        Downturns in economic conditions globally may adversely affect the Company's performance and results of operations. The Company's performance and results of operations are heavily influenced by the condition of the UK economy. Unfavourable macroeconomic conditions in the UK and globally, including recessionary economic cycles, higher interest rates, volatile fuel and energy costs, rising inflation, increased taxes, increased levels of unemployment, stagnant or declining wages and rises in the cost of living have resulted, and may result in the future, in a need to streamline costs and business operations. Other events and developments, including geopolitical developments, social or political unrest, war, terrorist acts and other hostilities, outbreaks of disease, natural catastrophes and the effects of climate change, macroeconomic policy, trade policy and conflicts, business and consumer sentiment, demographic changes, monetary policy (i.e. interest rates), commodity prices, public and private debt levels and government policies targeting public spending, may also in the future have, an indirect effect on the Company's operations. In particular, the COVID-19 pandemic and ongoing conflicts in the Middle East and Russia/Ukraine have had a severe and prolonged effect on the global economy generally, impacting the share value of many listed entities.

12.      RECOMMENDATION

The Directors consider that the proposed Share Reorganisation is in the best interests of the Company and its Shareholders as a whole.

Accordingly, the Directors unanimously recommend that you vote in favour of the Resolutions being proposed at the General Meeting, as they intend to do or procure to be done in respect of their own and their connected persons' beneficial holdings comprising 38,693,322 of the Existing Ordinary Shares and representing approximately 25.9% per cent of the Existing Ordinary Shares.