NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, TO US PERSONS OR INTO OR WITHIN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN, OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS ANNOUNCEMENT. THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER TO ISSUE OR SELL, OR ANY SOLICITATION OF ANY OFFER TO SUBSCRIBE OR PURCHASE, ANY INVESTMENTS IN ANY JURISDICTION.
THIS ANNOUNCEMENT INCLUDES INSIDE INFORMATION
CHENAVARI TORO INCOME FUND LIMITED (the "Company")
22 November 2018
Proposed annual tender offer with potential sale of shares out of treasury
The Board of Chenavari Toro Income Fund Limited announces that in order to improve the Company's trading liquidity, it is proposing to undertake an annual tender offer with potential associated sale of shares out of treasury (each an "Annual Liquidity Process").
The terms of each Annual Liquidity Process would be disclosed in advance, with the tender price targeted to be at a tighter discount to NAV year after year.
The quantum of shares available for each tender offer and the tender price would be announced ahead of each tender offer, and eligible shareholders would be entitled to participate up to a maximum of their individual pro-rata entitlements in each tender offer, with no over-election permitted.
Once a tender offer result is announced, a certain number of shares to be purchased by the Company as part of such tender offer would be made available to investors. To the extent practicable, resold shares would only be available to new investors or existing shareholders who have not participated in the tender offer.
The shares available for resale would be sold at the prevailing market price at the time of sale and would enable investors to buy larger quantities of shares, which is currently not possible due to low liquidity levels.
The parameters of each Annual Liquidity Process will ensure that the cumulative overall effect of each such process is not dilutive to the Company's remaining shareholders.
The first Annual Liquidity Process is expected to take place in Q1 2019. A circular, detailing the parameters of the first Annual Liquidity Process, and convening to an Extraordinary General Meeting of the Company, will be published in due course.
The current concert party, comprising Chenavari Investment Managers Holdings and parties deemed to be acting in concert with it for the purposes of The City Code on Takeovers and Mergers, do not intend to participate in the tender offer associated with the first Annual Liquidity Process, save that Chenavari European Opportunistic Credit Master Fund LP (a member of the concert party) may participate in the tender offer to the extent required to maintain its percentage shareholding in the Company at below 30 per cent.
The Board anticipates that these actions will help to address the liquidity issue and the persistent discount to net asset value at which the Company has been trading.
Enquiries:
Chenavari Investment Managers: Kirstie Sumarno - 020 7259 3600, Guy Coyard - 020 7245 4672
J.P. Morgan Cazenove: William Simmonds - 020 7742 4000
This announcement is not an offer to sell or a solicitation of any offer to buy the securities of Chenavari Toro Income Fund Limited (the "Company") in the United States, Australia, Canada, Japan, or in any other jurisdiction where such offer or sale would be unlawful.
This communication is not for publication or distribution, directly or indirectly, in or into the United States of America. This communication is not an offer of securities for sale into the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States, except pursuant to an applicable exemption from registration. No public offering of securities is being made in the United States.
The information contained in this announcement is given at the date of its publication (unless otherwise marked) and is subject to updating, revision and amendment. In particular, the proposals referred to herein are tentative and are subject to material updating, revision and amendment. No reliance may be placed for any purpose whatsoever on the information or opinions contained in this announcement or on its completeness, accuracy or fairness.
The information in this announcement may include forward-looking statements, which are based on the current expectations and projections about future events and in certain cases can be identified by the use of terms such as "may", "will", "should", "expect", "anticipate", "project", "estimate", "intend", "continue", "target", "believe" (or the negatives thereon) or other variations thereon or comparable terminology. These forward-looking statements, as well as those included in any related materials, are subject to risks, uncertainties and assumptions about the Company, including, among other things, the development of its business, trends in its operating industry, and future capital expenditures and acquisitions. In light of these risks, uncertainties and assumptions, the events in the forward-looking statements may not occur. Each of the Company its affiliates and their respective officers, employees and agents expressly disclaim any and all liability which may be based on this announcement and any errors therein or omissions therefrom.
This announcement does not constitute or form part of, and should not be construed as, any offer or invitation or inducement for sale, transfer or subscription of, or any solicitation of any offer or invitation to buy or subscribe for or to underwrite, any share in the Company or to engage in investment activity (as defined by the Financial Services and Markets Act 2000) in any jurisdiction nor shall it, or any part of it, or the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision whatsoever, in any jurisdiction.
J.P. Morgan Cazenove is authorised and regulated in the United Kingdom by the Financial Conduct Authority. J.P. Morgan Cazenove is acting as corporate broker to the Company and no one else in connection with the proposals described in this announcement, and will not be responsible to anyone other than the Company for providing the protections afforded to clients of J.P. Morgan Cazenove or for affording advice in relation to any transaction or arrangement referred to in this announcement. This announcement does not constitute any form of financial opinion or recommendation on the part of J.P. Morgan Cazenove or any of its affiliates and is not intended to be an offer, or the solicitation of any offer, to buy or sell any securities.
