Fair Oaks Inc Regulatory News (FAIR)

Fair Oaks Income Limited

21 June 2018

FAIR OAKS INCOME LIMITED (the "Company")

(Incorporated in Guernsey under The Companies (Guernsey) Law, 2008, as amended, with registered number 58123 and registered as a Registered Closed-ended Collective Investment Scheme with the Guernsey Financial Services Commission)

PORTFOLIO UPDATE

Fair Oaks Income Limited (the "Company") is pleased to announce that FOIF LP ("Master Fund I") has exercised its rights as control equity investor to call (liquidate) Ares XXXV CLO. Ares XXXV was established in September 2015 and ended its reinvestment period in October 2017. The Company estimates that the total return generated for this investment will be 17% (see Note 1), above its original 15-16% expected at the time of investment.

FOMC II LP ("Master Fund II") has entered into binding contracts to acquire, in the primary market, $26.0 million notional of equity notes, representing 69% of the total equity of Ares XXXVR CLO, a new CLO managed by Ares Management. Upon closing, Ares XXXVR CLO will acquire the loan portfolio from Ares XXXV CLO at mid-market price.

Ares Management is a global alternative investment manager with approximately $106 billion in assets under management.

The CLO's target portfolio has a principal value of $400 million with expected holdings of 282 unique bank loan issuers, with an expected weighted average exposure per issuer of 0.35%.

The potential total return for this investment as estimated by the general partner of Master Fund II is between 14% and 16% per annum (see Note 2).

In addition, Master Fund II has entered into binding contracts to acquire, in the primary market, $30.0 million of equity notes, representing 61% of the total equity of Shackleton XII CLO, a new CLO backed by a portfolio of US broadly syndicated, secured loans.

The manager of this CLO's portfolio is Alcentra NY, LLC, a subsidiary of BNY Alcentra Group Holdings. Alcentra Group Holdings is a global specialist sub-investment grade corporate debt management business with $35.7 billion of assets under management.

The CLO's target portfolio has a principal value of $500 million across an expected 268 unique bank loan issuers, with an expected weighted average exposure per issuer of 0.29%.

The potential total return for this investment as estimated by the general partner of Master Fund II is between 14% and 15% per annum (see Note 2).

Notes:

1) Expected return calculated from inception, as of 19-Jun-18.

2) The General Partner's estimate of the potential total return for this investment is calculated across certain scenarios and subject to certain assumptions. This and any other references herein to potential future returns or distributions are targets and not forecasts and there can be no guarantee or assurance that they will be achieved.

This document is for information purposes only and is not an offer to invest. All investments are subject to risk. Past performance is no guarantee of future returns. Prospective investors are advised to seek expert legal, financial, tax and other professional advice before making any investment decisions.

LEI: 2138008KETEC1WM5YP90

Enquiries:

Fair Oaks Income Limited

Email: contact@fairoaksincome.com

Web: www.fairoaksincome.com

Fair Oaks Capital Limited

Investor Relations

DDI: +44 (0) 20 3034 0400

Email: ir@fairoakscap.com

Praxis Fund Services Limited

Ben Le Prevost

DDI: +44 (0) 1481 755524

Email: Ben.LePrevost@praxisifm.com

Numis Securities Limited

Nathan Brown, Corporate Broking

DDI: +44 (0) 20 7260 1426

Email: n.brown@numis.com 

Fair Oaks Income Limited

Fair Oaks Income Limited is a registered closed-ended investment company incorporated in Guernsey. The Company was admitted to trading on the Specialist Fund Market of the London Stock Exchange (now the Specialist Fund Segment of the Main Market of the London Stock Exchange) on 12 June 2014.

The investment policy of the Company is to invest (either directly and/or indirectly through the Master Fund and/or Master Fund II) in US and European CLOs or other vehicles and structures which provide exposure to portfolios consisting primarily of US and European floating-rate senior secured loans and which may include non-recourse financing. The Company will implement its investment policy by remaining invested in the Master Fund and making new investments in Master Fund II.