Albion VCTs Merger Announcement: Key Benefits and Offers

Proposed Mergers of Albion VCTs

Introduction to the Merger

The Albion Venture Capital Trusts (VCTs) have announced a strategic plan to merge from six entities into three. This decision aims to improve operational efficiency, reduce costs, and simplify management. The transition is shaped by the boards of Albion Venture Capital Trust PLC, Albion Technology & General VCT PLC, Albion Development VCT PLC, Albion Crown VCT PLC, Albion Enterprise VCT PLC, and Albion KAY VCT PLC.

Key Components of the Merger

Details of the Merge

The discussions surrounding the merger have reached a significant milestone, as the boards have agreed in principle to consolidate the VCTs. If approved, AADV will merge with AAEV, KAY will combine with AATG, and AAVC will join CRWN. This merger process is aligned with section 110 of the Insolvency Act 1986, which allows for the transfer of assets and liabilities between the VCTs.

Shareholder Meetings

To proceed with these mergers, general meetings are scheduled for shareholders to vote on the proposed changes. The outcome of these meetings is crucial for the future of the VCTs.

Benefits of the Merger

The anticipated advantages of these mergers include:

• Annual cost savings estimated at £1.5 million, enhancing overall shareholder value.
• A simplified investment structure that reduces confusion for shareholders holding multiple VCTs.
• Improved long-term stability and resilience, positioning the VCTs for future growth.
• More concentrated management and administration efforts, allowing Albion Capital to hone its investment strategies.
• Increased regulatory compliance adaptability, facilitating smoother investment realizations.

Subscription Offers for Shareholders

Subscription Opportunities

In conjunction with the merger, the Acquirer VCTs are launching new offers for subscription. This presents a unique opportunity for both existing shareholders and new investors to invest in AAEV, AATG, and CRWN while benefiting from the potential tax reliefs associated with VCT investments.

Details of the Offers

The offers are structured as follows:

• AAEV Offer: up to £10 million initially, with the potential for another £10 million.
• AATG Offer: a target of £20 million, plus an extra £10 million if needed.
• CRWN Offer: similar structure as AATG, targeting £20 million with an option for an additional £10 million.

The offer period begins on January 6, 2025, and will close on April 4, 2025, giving investors a defined window to participate.

Related Transactions and Rationalization

Adjustments Post Merger

Following the mergers, adjustments will be made to related party transactions involving Albion Capital, the VCTs' investment manager. These changes aim to enhance performance incentives, aligning them with shareholder outcomes and ensuring fairness in management fees.

Approval Requirements

Shareholder approval will be sought for these transactions at the general meetings scheduled concurrently with the merger votes. Transparency and fairness are emphasized by the boards, with expert advice from Howard Kennedy Corporate Services ensuring the legitimacy of these transactions.

Next Steps and Timetable

Moving Forward

The timetable for these mergers and offers is critical. Shareholders are advised to watch for proxy forms and meeting announcements. The discussions around merging these six VCTs into three will continue to evolve, and updates will be provided via shareholder communications.

Contact Information

For more information, stakeholders can contact Vikash Hansrani, Operations Partner at Albion Capital Group LLP, at 020 7601 1850.

Frequently Asked Questions

What are the Albion VCTs merging into?

The merger will consolidate six Albion VCTs into three entities, increasing operational efficiency and shareholder value.

What benefits do shareholders expect from the merger?

Shareholders can anticipate significant cost savings, operational simplifications, and enhanced long-term returns.

When are the offers for subscription open?

The subscription offers will open on January 6, 2025, and remain open until April 4, 2025.

Are the offers conditional on the mergers?

No, the offers for subscription are not conditional on the completion of the mergers.

Who can I contact for more information about the merger?

Stakeholders can reach out to Vikash Hansrani at Albion Capital for any inquiries regarding the merger and offers.

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