For immediate release on 26 September 2016
This announcement contains inside information
Alternative Asset Opportunities PCC Limited
Proposed Disposal of the Portfolio - Update
The Board of Alternative Asset Opportunities PCC Limited (the "Company") announced on 13 September 2016 that it had conditionally agreed to sell 71 of the Company's 80 policies for a total cash consideration of $40.0 million, subject to adjustment (the "Disposal"). The Disposal requires changes to the Company's current investment objective and policy which are material and therefore subject to the approval of Shareholders at an Extraordinary General Meeting convened for 10 October 2016 (the "Proposal").
The Board is pleased to announce today that it has conditionally agreed to sell the remaining nine policies for an aggregate consideration of $3.25 million. Six policies are being acquired by Vida Longevity Fund, L.P. on the same terms agreed for the 71 policies (and therefore subject to shareholder approval) and three policies are being acquired by Life Equity LLC which are not conditional upon shareholder approval. In aggregate, therefore, the Company has conditionally agreed to sell its entire policy portfolio for a consideration of $43.25 million which represents a premium of approximately 6.1 per cent. to its book value of $40.77 million as at 31 August 2016 and adjusted for the planned COI increases referred to in the announcement on 16 September 2016.
If Shareholders approve the Proposal at the forthcoming Extraordinary General Meeting and the Disposal completes, it is expected that the Company will soon thereafter put forward proposals for a members' voluntary winding up or other restructuring.
Following completion of the Disposal, the sale of the remaining nine policies referred to above and the winding-up, on the basis of the assumptions set out below, it is estimated that Shareholders should receive a capital return of approximately 51 pence per Share:
o receipt of proceeds of $43.25 million pursuant to the Disposal and the sale of the remaining nine policies in the portfolio;
o transaction costs of approximately 0.6 pence per Share including fees payable to the Investment Manager and the expenses incurred in relation to the Disposal;
o eventual costs of winding-up the Company, including premiums, the running expenses of the Company and the Shareholder resolutions, of approximately 0.6 pence per Share;
o the retention by the liquidator of an amount to meet any unascertained or unknown liabilities of the Company; and
o an exchange rate of £1:$1.30.
Shareholders should note that the estimate of the capital return above is for illustrative purposes only and should not be relied upon. In particular, adverse movements in the exchange rate - that is to say a weaker Dollar relative to Sterling - will reduce the aggregate capital return per Share ultimately made.
Stockdale Securities Limited 020 7601 6118
Alastair Moreton/Rose Ramsden
Tracey Lago 020 3246 7405
This information is provided by RNS