17 Jan 2012 11:08
VENTUS 2 VCT PLC
Interim Management Statement - 17 January 2012
Ventus 2 VCT plc (the "Company") presents its final interim management statement for the financial year ending 28 February 2012, as required by the UK Listing Authority's Disclosure and Transparency Rule 4.3.
The Company published its half-yearly financial report for the six months ended 31 August 2011 on 27 October 2011. This interim management statement summarises the information as at the date of that report together with any further developments up to the date of this statement.
Net Asset Value, Dividends and Investments - Ordinary Shares
The Net Asset Value ("NAV") of the ordinary share fund as at 31 August 2011 stood at £14.62 million or 59.6p per ordinary share. There has been no significant change in the NAV of the ordinary share fund between 31 August 2011 and the date of this statement.
The Company has not declared an interim dividend in respect of the ordinary share fund in order to preserve the Company's cash resources.
As at the date of this statement, the Company holds ordinary share investments in 17 companies with a total investment value of £13.36 million.
Investments in Waste Wood Biomass Companies
In September 2011, the Board announced write downs in the value of the ordinary share fund's holdings in investments in Sandsfield Heat & Power Limited and Twinwoods Heat & Power Limited. The value of these investments was written down to nil which was recognised in the half-yearly financial report for the six months ended 31 August 2011. The ordinary share fund's investment in PBM Power Limited had been written down to nil in the financial statements of the Company for the year ended 28 February 2011. The new investment manager, Temporis Capital LLP ("Temporis"), is continuing to work with these investee companies, as well as with their lending banks and with external engineering consultants. At the present time, the likely outcome of these efforts remains uncertain, although the Board believes the likelihood of any recovery from these three investments is small. Therefore the Board considers it appropriate to maintain the value of these investments at nil. The write-downs of the investments in the waste wood biomass companies do not affect the Company's C shares.
Effective Recovery of £530,000 Loaned to PBM Power Limited - Ordinary Shares
The Company disclosed in its financial statements for the year ended 28 February 2011 that an unsecured loan of £530,000 was made to PBM to fund its operating expenses. This loan was not approved by the Ventus Investment Committee of Climate Change Capital Limited (the investment manager at the time) and was recognised as a realised capital loss in the financial statements for the year ended 28 February 2011.
In connection with taking over the investment management of the Company, Temporis agreed to waive investment management fees amounting to £530,000 in relation to the Company's ordinary share fund. Also, in order to reinforce the Company's financial position, Temporis advanced a £530,000 interest-free loan to the Company's ordinary share fund, to be repaid by the Company over the period of time that the waived investment management fees would otherwise have been charged.
Net Asset Value, Dividends and Investments - C Shares
The Net Asset Value ("NAV") of the C share fund as at 31 August 2011 stood at£10.51 million or 92.8p per C share. There has been no significant change in the NAV of the C share fund between 31 August 2011 and the date of this statement.
The interim dividend for the financial year ending 29 February 2012 of 1.00p per C share was paid on 11 January 2012 to all C shareholders on the register as at the close of business on 9 December 2011.
On 21 December 2011 the C Share fund invested £1,000,000 in AD Wind Farmers Limited, which holds an interest in Allt Dearg Wind Farmers LLP. The LLP is constructing a 10MW windfarm near Lochgilphead, Scotland. The C share fund had advanced a secured short term loan of £275,000 to Allt Dearg Wind Farmers LLP to fund pre-financial close project expenditure. The loan was repaid and the balance of the interest accrued was paid to the Company on financial close.
As at the date of this statement, the Company's C share fund holds investments in eight companies with a total value of £6.23 million.
For further details of the Company's portfolio of ordinary and C share investments please see the half-yearly financial report for the six month period ended 31 August 2011 which is available through the Company's website (www.ventusvct.com).
Portfolio Review by the New Investment Manager
With effect from 12 September 2011, the Board transferred the investment management of the Company from Climate Change Capital Limited to Temporis. There was no notice period or charge due to Climate Change Capital Limited under the Termination and Transfer Agreement.
Temporis is undertaking a thorough review of each of the Company's assets and will present a detailed report in the Investment Manager's Report of the Annual Report & Financial Statements for the year ending 29 February 2012.
Share Offer and Tender Offer
On 12 January 2012, the Directors of the Company announced their intention to have the Company raise up to £10,000,000 by way of an issue of new ordinary shares ("the Share Offer"). In connection with the Share Offer, the Company will be proposing to undertake a tender offer to purchase up to 12,000,000 ordinary shares from existing ordinary shareholders ("the Tender Offer"). The Company, jointly with Ventus VCT plc, will publish a prospectus relating to the Share Offer and a circular relating to the Tender Offer. The circular will set out resolutions to be proposed at a general meeting of the Company to approve the Share Offer and Tender Offer, as well as a proposal to extend the life of the Company from 2014 to 2018. The prospectus and circular are both currently under review by the UKLA and are expected to be approved and available for public distribution in late January or early February 2012. Participation in the Tender Offer will be subject to an ordinary shareholder applying the full proceeds of his or her share sale to subscribe for new ordinary shares under the Share Offer.
Other than described above, the Board is not aware of any events during the period from 31 August 2011 to the date of this statement which would have had a material impact on the financial position of the Company.
Issued on behalf of the Board
The City Partnership (UK) Limited
Company Secretary
17 January 2012