20 Dec 2019 17:53
Foresight Solar & Technology VCT plc - Publication of Prospectus
Foresight Solar & Technology VCT plc ("Company") (formerly Foresight Solar & Infrastructure VCT Plc)
Publication of a circular to shareholders of the Company including a notice of general meeting and publication of a Prospectus relating to an Offer for Subscription to raise in aggregate up to £20 million (with an over-allotment facility for up to an additional £10 million) by issues of a new class of Foresight Williams Technology Shares (“FWT Shares”) ("Offer")
Summary
The board of the Company ("Board") is pleased to announce the publication of a prospectus relating to the Offer. Shareholders will shortly receive a copy of a circular seeking their approval at a general meeting to various resolutions intended to facilitate the making of the Offer.
Background and reasons for the offer
The Board is pleased to announce the publication of a Prospectus relating to the Offer to raise up to £20 million (with an over-allotment facility for up to an additional £10 million).
The Board, and the Company's investment manager Foresight Group LLP, believe that Foresight’s well established collaboration with Williams Advanced Engineering provides an attractive solution through the formation of a new share class within the Company focusing on innovative technology investments; a class which is separate from the existing solar portfolio while still leveraging the expertise and experience of the Investment Manager’s energy, infrastructure and private equity teams, honed over many years of solar and technology investing.
The FWT Shares
The FWT Shares are a new class of Share and are separate from the Company's existing class of Ordinary Shares. All investments and cash attributable to the existing Ordinary Share class will be kept separate from the FWT Share Fund. Accordingly, investors in the FWT Shares will not have any exposure to the investment gains or losses of the Ordinary Share class.
Change of name
As announced earlier today, the Company has changed its name to Foresight Solar & Technology VCT plc with effect from,19 December 2019.
Trading in the Company’s Ordinary Shares is expected to recommence shortly under the new name for the existing Ordinary Shares of 1p each shortly. The tickers, SEDOL and ISIN for the existing Ordinary Share class will not change.
The Board decided to make this change in light of changes to the VCT Rules which restrict the making of new investments into energy generation businesses. These restrictions have recently been extended to prohibit the making of investments into companies which do not meet a widely drawn ‘risk to capital’ condition.
The Company has also today posted a circular to Shareholders (the “Circular”) and form of proxy in relation to a general meeting of the Company in connection with the Offer. The Circular contains, inter alia, an explanation of the resolutions required to implement the Offer including to:
authorise the Directors to allot FWT Shares pursuant to the Offer;disapply pre-emption rights so that FWT Shares can be allotted on a monthly basis without the need to make pre-emptive offers to existing investors;authorise future buybacks of FWT Shares;authorise the Company to enter into an investment management agreement and performance incentive agreement with, inter alias, Foresight Group LLP in relation to the FWT Shares fund;amend the Articles in order to set out the rights attaching to the FWT Shares; andauthorise the Company to cancel its share premium account.These proposals require the approval of the Company's shareholders and this is being sought at a general meeting of the Company to be held on 27 January 2020 at 11.00 a.m. at the offices of Foresight Group LLP, The Shard, 32 London Bridge Street, London SE1 9SG. Investment policy The issue of FWT Shares will require a change in the investment policy of the Company which requires approval of the Company's shareholders and is set out in full in the circular convening the general meeting published today.
Related party transactions
It is also proposed, subject to Shareholders' approval, that the Company will enter into an amended investment management agreement pursuant to which Foresight Group LLP will be appointed by the Company as its investment manager, including in respect of the FWT Shares Fund, on the terms summarised below. It is also proposed to amend the Company’s carried interest agreement. Foresight Group LLP and Foresight Group CI Limited (“Foresight”), who are parties to these agreements as the Company's investment manager and adviser, are regarded as related parties of the Company under the Listing Rules, therefore the entry into these agreements constitute a related party transaction for the purpose of the Listing Rules and requires Shareholders' approval.
Pursuant to the amended investment management agreement, Foresight will be entitled to an annual management fee of 2.0% of net assets (plus VAT) per annum and secretarial and accounting fee of 0.3% of net assets (subject to a minimum of £60,000) per annum. Pursuant to the amended carried interest agreement, inter alia, Foresight will be entitled to a performance incentive (in cash or new FWT Shares in the Company issued at par) to a value equal to 20% of distributions in excess of 110p (including capital distributions of NAV) per FWT Share (subject to annual adjustment of this hurdle in line with the Retail Price Index). No performance incentive will be distributed to Foresight until FWT Shareholders have received distributions of 100p per FWT Share.
In addition, Foresight Group Promoter LLP (the “Promoter”) will be appointed as promoter of the Offer under the terms set out below and the Promoter, as Foresight’s agent and associate, is regarded as a related party of the Company under the Listing Rules, therefore the terms of this appointment constitute a related party transaction under rule 11.1.10 of the Listing Rules.
Pursuant to a sponsor and promoter agreement dated 20 December 2019 relating to the Offer between, among others, the Company and the Promoter, the Promoter will receive a fee of an amount up to a maximum of 5.5% of the amount subscribed under the Offer by Investors for acting as promoter of the Offer.
Further Information
The Offer is now open and will close on 3 April 2020 for the 2019/2020 tax year and 18 December 2020 for the 2020/21 tax year or earlier if the Offer is fully subscribed or otherwise at the Board's discretion.
Full details of the Offer will be set out in the Registration Document, Summary and Securities Note which together comprise a Prospectus in accordance with the Prospectus Regulation, and which is published as at today's date. The Offer is conditional on the passing of certain of the resolutions to be proposed at a general meeting to be held 27 January 2020 as set out in the circular published today.
All documents comprising the Prospectus will also available from the offices of the Promoter, The Shard, 32 London Bridge Street, London SE1 9SG and the following website: http://www.foresightgroup.eu.
A copy of the Prospectus has also been submitted to the Financial Conduct Authority and will be shortly available for inspection on both the Promoter's website (www.foresightgroup.eu) as well as at the National Storage Mechanism (www.morningstar.co.uk/uk/nsm).
For further information, please contact: Gary Fraser Foresight Group Telephone: 020 3667 8181