Rights &iss. Regulatory News (RIII)

Change of management arrangements

The Board announces today that Simon Knott, Investment Director, intends to retire as the investment manager of the Company with effect from 1st September 2022. The Board is pleased to note that Simon will continue as a non-executive director of the Company.

With the help of external consultants, the Board has carried out a thorough review of potential investment managers to succeed Simon and is now pleased to announce that, following this review, it intends to appoint Jupiter Unit Trust Managers Limited (“JUTM”) as the Company’s new investment manager with effect from 1st September, 2022. The lead investment manager will be Dan Nickols who will be supported by Matt Cable, both experienced investment managers within the UK Small and Mid-Cap Equity team of Jupiter. Subject to approval from the Financial Conduct Authority, it is also intended that JUTM will become the Alternative Investment Fund Manager (AIFM) and the Company will no longer be a self-managed Alternative Investment Fund with effect from 1st September. This appointment will not result in a change to the investment objective or investment policy of the Company and does not require shareholder approval.

Background to Jupiter Fund Management plc (‘Jupiter') and benefits

Jupiter is a specialist, high conviction, active asset manager which offers a range of actively managed strategies including equities, fixed income, multi-asset and alternatives. Jupiter is a constituent member of the FTSE 250 Index and has assets under management of £55.3bn as at 31st March, 2022.

The Board believes that the new investment manager will provide the following benefits to the Company’s shareholders:

- an approach which seeks both capital appreciation as well as generating sufficient income to maintain the existing dividend policy of the Company

- a plan to retain a significant proportion of the existing holdings and to maintain the Company’s policy of having a low level of investment turnover. This will ensure that the level of transaction costs continues to be low

Fees

As part of the new arrangements, the Company will pay Jupiter a combined fee in respect of its services as AIFM and investment manager which, together with the operating expenses of the Company, will not exceed 0.80% per annum of net assets. The Board notes that this arrangement would provide the Company with the lowest Ongoing Charges Figure (OCF) of any investment trust with a market capitalisation of less than £500m that is focused on UK small and mid-cap companies.

Tender Offer

The Board intends to make a tender offer to shareholders equal to ten per cent of the issued share capital of the Company at a price equal to 96% of the net asset value of the shares prevailing on the date of the tender. Details of the tender offer are expected to be sent to shareholders by the end of July.

None of the existing directors intends to participate in the proposed tender offer in respect of their own respective holdings.

Commenting on Simon’s decision to retire, David Bramwell, Chairman, said:

“The Board would like to express its gratitude to Simon Knott for his 39 years of service as the Company’s investment manager.  Simon has produced outstanding returns for shareholders over the period of his tenure, with the net asset value per share of the Company increasing 10371%, compared with a return of the FTSE All-share Index of 610%.  We are very pleased that Simon will remain a non-executive director of the Company following his retirement as investment manager.  At the same time, we look forward to working with the Jupiter team over the transition period and as investment manager from 1 September, 2022.  Jupiter’s UK Small and Mid-Cap Equity team has a formidable reputation as a deeply-resourced and top-performing investment team.”

Commenting on the appointment, Magnus Spence, Head of Investment Trusts at Jupiter, said:

“Jupiter is delighted to be chosen to manage the investment portfolio of the Company following Simon Knott’s long and distinguished career. We are excited to be given the opportunity to manage a closed-ended fund at this time in a segment of the market which has many outstanding investment opportunities.”

Enquiries:

David Bramwell, Chairman,

Simon Knott, Investment Director,

Robert Finlay/Rose Ramsden, Shore Capital

Tel: 020 7408 4050