ESC.L Regulatory News (ESC)

17 Feb 2005 16:52

Exeter Smaller Co's Income Fund Ld17 February 2005 Exeter Smaller Companies Income Fund Limited ESCIF Securities Limited Proposed Liquidation As explained in the Chairman's statement in the Report and Accounts for the yearended 30 September 2004, the Board has been considering the options availablefor the Company and its subsidiary ESCIF Securities Limited ("the Group").Having considered this matter further and having taken advice from the Group'sbrokers, Collins Stewart, the Board has concluded that the most appropriate wayforward for the Group would be for the Group to be placed into liquidation. The Board is proposing that on an early liquidation (which would require aspecial resolution to be passed by the ordinary shareholders and anextraordinary resolution of the zero dividend preference shareholders): - Ordinary Shareholders would receive 0.1p per share; and - Zero Dividend Preference Shareholders would receive the net assets ofthe Group after deducting the amount payable to Ordinary Shareholders and thecosts of the liquidation, including any costs associated with the earlyrepayment of the bank loan from Bank of Scotland. As at 31 January 2005 it isestimated that the costs of these proposals before any costs associated withdisposing of the Company's investment portfolio would have been approximately£235,000. The Board has spoken to certain large shareholders of the Group who haveindicated their support. Following this announcement, which places the matterin the public domain, the Board will be permitted to consult more widely withthe Group's shareholders. The timing of any liquidation has not been determined; however it is importantthat the timing will be such that the Group will be able to benefit from theliquidation of its holdings in Invesco Recovery 2005 PLC and Martin CurrieEnhanced Income Trust PLC. The Board has agreed with its investment adviser, Exeter Asset ManagementLimited, that the notice period to terminate its contract has been reduced fromsix months to three months and that the notice period with its administrators,Close Fund Services Limited, to terminate its contract has been reduced from 12months to 3 months. The Board has noted that certain other split capital investment companies haveundertaken a capital reorganisation with a view to putting shareholders in thesame position as they would have been in, had a liquidation taken place, but atthe same time realising some value in respect of the Company's unrealisedlosses. The Board will consider such a reorganisation if it would materiallyenhance the returns to Zero Dividend Preference Shareholders. Contact: James King Collin Stewart 0207 523 8350 This information is provided by RNS The company news service from the London Stock Exchange