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(Alliance News) - Polar Capital Holdings PLC on Wednesday said preference shares held by the co-heads of its Polar Capital North America Team have been partially crystallised.
The company's management team have the prospect of obtaining an interest in Polar Capital through the purchase of preference shares in its Polar Capital Partners Ltd subsidiary. These preference shares are convertible when "crystallisation events" occur into either cash or ordinary Polar Capital shares.
Having opted to crystallise their shares, Andrew Holliman and Richard Wilson - who are managers of the Polar Capital North American Fund as well as co-heads of the Polar Capital North America Team - are no longer eligible to receive the crystallised part of their share in Polar Capital's core operating profit. They will therefore receive a smaller interest in their performance fees.
The crystallisation is this expected to be immediately earnings enhancing for Polar Capital shareholders. Given the company's results for its financial year ended March 29, crystallisation would have resulted in an approximately 1.0 pence per share earnings enhancement.
The initial crystallisation value will be satisfied through the issue of up to 1.4 million ordinary Polar Capital shares in tranches. The value is re-calculated for the three years after March 31 based on the profit of the business unit and can only be adjusted downwards.
In return, the North American team forfeits a third of the interest in their core operating profit relating to Polar Capital North American Fund for the financial year to March 2019. The other two thirds of their preference share class are still convertible.
Shares in Polar Capital were up 1.1% at 540.00 pence in London on Wednesday afternoon.
By Anna Farley; annafarley@alliancenews.com
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