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You have put in a good deal of work on this Hounddog. Thank you. That's an excellent email.
Anyone with certificates rather than online holdings - have you received your voting form - I haven't.
Great stuff Hounddog 10.
4/4
Whatever the exact circumstances and facts are (and for whatever reasons) it is hard to see that the delayed voting timetable on this takeover for private investors is moving forward in an orderly manner that brings any credit to the AiM or London market as a whole. A market that is already under considerable pressure. I should say that I do not believe these difficulties are intentional but more an unfortunate coalescence of circumstances in the relatively unusual circumstance of an adjourned Court Meeting.
In terms of the Shanta takeover private investor involvement is not entirely semantic. Clients of just three of the major private client brokers - Hargreaves, Interactive Investor and AJ Bell, at Shanta’s own last count (notably, collectively, still there post bid), own some 21% of Shanta. As you will be aware a Scheme vote can be defeated by a relatively small percentage of investors.
I would suggest the need for the Panel to ask the advisers (Berenberg and Liberum, particularly Liberum as it is the Rule 3 adviser to Shanta) to take control of the situation. The fairest outcome would be for Shanta/Saturn to provide clear guidance and, if necessary, further delay the vote such that there is adequate time for investors to consider matters and not be railroaded into a decision with uncertain information.
Thank you.
3/4
As you will be aware, there is always the option on the Scheme vote (but not on the AGM vote) for shareholders to turn up at the Court Meeting and vote but this is almost always prohibitive in terms of cost and time for the private shareholder (Shanta’s topco is registered in Guernsey). Presumably the Scheme vote cannot be concluded until the Court Meeting occurs but conceivably the AGM vote is done. However, there is no clarity on this.
It should be noted that the Scheme Document states that any adjournment would result in (both the Scheme and AGM) voting deadlines being pushed back with the “remote” voting deadlines and count happening in a similar manner to the original timetable ie two days before the adjourned Court Meeting (so the new deadline being 26 March 2024).
What has happened over the weekend and the end of last week is that major private client brokers have started to issue reminders to their clients to “take action “ and vote again. Deadlines that have been set include the 21 and 22 March 2024, somewhat ahead of 26 March 2024, no doubt for logistical reasons. In other words, very little notice.
Many private investors are now confused as to what they are being asked to vote on. There has been no further instruction from Shanta on voting (or indeed any particular specificity from the private client brokers, who seem to be largely activating standard administrative processes to deal with a timetable that is not in their control). Some private investors are reporting on investor bulletin boards that their initial voting intention has been wiped and they have to vote again. If this is indeed the case, it should not be happening that their initial intention is no longer valid. Other private investors are saying that they can no longer vote on the AGM vote, which may indeed be legally correct but remains unexplained by Shanta.
2/4
As you will be aware there are normally two votes on a Scheme, as is the case here. One specifically on the Scheme and another an AGM vote on amending the Articles of Association in order to effect the Scheme.
The “remote” electronic vote on both motions (the remote electronic vote being the
relevant one for private investors) on the takeover was scheduled to complete on 27 February 2024 at just after midday with the Voting Record Time happening at 6pm that day. The Court Meeting to give legal effect to that vote was to be held two days later on 29 February 2024. At 7am on 29 February 2024 Shanta released an RNS saying that the Court Meeting was expected to be adjourned to 28 March 2024. No explanation was given as to the reason other than it was:
“Following feedback received from Shanta Shareholders in connection with the Scheme,”
The status of votes already cast and, presumably, counted on 27 February 2024 was not explained. On 3.20pm on 29 February 2024 Shanta released a further RNS confirming the adjournment of the Court Meeting and stating that, in the meantime, shareholders should take “no action”:
“As disclosed in the Adjournment Announcement, it is expected that the adjourned Meetings will be reconvened and held on 28 March 2024 and a further announcement detailing the timetable in relation to the adjourned Meetings will follow in due course. The Independent Shanta Directors recommend that Shanta Shareholders take no action at this time.”
There has been no “further announcement”.
1/4
SHANTA GOLD LIMITED
I write in relation to the potential takeover of Shanta Gold Limited (“Shanta”), an AiM admitted and traded company that mines gold in Tanzania, and to draw your attention to certain matters. To put it mildly, this a controversial takeover by an insider (a non executive director) and his associates/family. The SPV being used is Saturn Resources Ltd (“Saturn”), a wholly owned subsidiary of ETC Holdings (Mauritius) Limited, a private conglomerate. The takeover bid was only at a negligible 6.72% premium to the then share price and was announced on 20 December 2023. So the announcement was immediately before the Christmas break when the City is almost completely closed down for a fortnight.
The takeover is by way of a Scheme of Arrangement (“Scheme”) with, somewhat inexplicably, given the minimal premium, a recommendation by Shanta’s Board of Directors. As is normal, a Co-operation Agreement between Shanta and Saturn was signed on 20 December 2023. So, as you know, Shanta and Saturn are, more or less, in lockstep and working together.