FRF Foresight 5

 
TIDMFRF 
 
ANNOUNCEMENT 
 
FORESIGHT 5 VCT PLC 
 
22 JULY 2011 
 
PROPOSED SHAREHOLDER OFFER OF 5,439,493 OFFER SHARES AT 14 PENCE EACH AND NOTICE 
OF GENERAL MEETING 
 
 
SUMMARY 
 
The  Company  has  gone  through  a  difficult  period  over the last few months 
culminating with the appointment of a new investment manager, Foresight Group CI 
Limited  ("Foresight  Group"),  on  24 February  2011 and  the announcement of a 
substantial reduction in the net asset value of the Company as at 31 March 2011. 
 
As  mentioned in the Chairman's Statement in  the Half Yearly Report for the six 
month  period  ended  31 March  2011, the  Board  believes  the Company is in an 
unsatisfactory position, being cash constrained and not being able to contribute 
to the potential funding requirements of several of the investee companies if so 
required.  This also means that the Company cannot, at present, benefit from the 
access to new dealflow from Foresight Group. 
 
Working  in conjunction with Foresight Group, the Board has a clear strategy for 
the Company as well as for each of the existing investee companies. The strategy 
is  two-fold: (i) firstly to raise a small amount of funds through a pre-emptive 
offer, at a discounted price to net asset value, to existing shareholders (other 
than overseas shareholders) to be able to contribute to funding requirements for 
the  existing portfolio as and when they arise  and (ii) to raise funds later in 
the  year through a public offer pursuant  to a prospectus for further expansion 
and diversification of the portfolio. 
 
This  Company is, therefore, posting to  shareholders today a circular dated 22 
July  2011 ("Circular")  containing  the  first  of  these  proposals,  namely a 
fundraising  by way of a discounted preemptive offer to shareholders (other than 
overseas  shareholders) of  1 ordinary share  of 1p each  in the  capital of the 
Company  ("Offer Shares") for every  10.14296 existing shares held ("Shareholder 
Offer").  The Shareholder Offer,  if fully subscribed,  will raise approximately 
 GBP761,529  (before expenses). The Board have decided to defer seeking shareholder 
authority  at  this  time  for  any  further  proposed  public offer in light of 
considering  potential corporate activities as  referred to below. Following the 
outcome  of these considerations, the Board  shall further write to shareholders 
and,  as appropriate,  seek the  necessary authorities  to raise funds through a 
public offer. 
 
The  Shareholder  Offer  requires  the  approval  by shareholders, which will be 
sought pursuant to resolution 1 to be proposed at the general meeting to be held 
at 12.00 noon on 15 August 2011 ("General Meeting"), notice of which is also set 
out  in  the  Circular.  The  Board  are  also  taking the opportunity to obtain 
approval  from  shareholders  to  cancel  share  premium  and capital redemption 
reserves  which will be sought pursuant to resolutions 2 and 3 to be proposed at 
the General Meeting. 
 
COMPANY UPDATE 
 
A  full summary of the financial and trading position of the Company was set out 
in   the  Half-Yearly  Report,  including  details  of  the  current  investment 
portfolio.  There  has  been  no  material  change  to  the financial or trading 
position of the Company since 31 March 2011. 
 
The  intention  is  that  David  Sebire  (the Chairman) will step down following 
completion  of  the  Shareholder  Offer  and  Catrina  Holme  will  take over as 
Chairman.  At that  time, Peter  Dicks, who  is a  director on  the board of the 
Foresight VCTs, will be appointed as a Director. David Donnelly will continue in 
his  current role to help manage any  corporate activity if we are successful in 
future  negotiations, but  then David  Donnelly and,  potentially, Catrina Holme 
will also step down as Directors. 
 
THE SHAREHOLDER OFFER 
 
The  Board is proposing to raise  up to approximately  GBP761,529 (before expenses) 
through  the issue of  up to 5,439,493 Offer  Shares pursuant to the Shareholder 
Offer,  which is being made on a pre-emptive  basis and at a discounted price to 
net  asset value. The Shareholder Offer is being made to all holders of ordinary 
shares  and  C  ordinary  shares  (other  than  overseas shareholders) as if the 
ordinary shares and C ordinary shares represented one class of share. Successful 
applicants  under  the  Shareholder  Offer  will, however, only receive ordinary 
shares. 
 
Qualifying  Shareholders (as  defined in  the Circular)  have the opportunity to 
apply to subscribe for Offer Shares at an issue price of 14p per Offer Share pro 
rata to their holdings of existing shares as at the record date on the following 
basis: 
 
                1 Offer Share for every 10.14296 existing shares 
 
and  so on  in proportion  for any  other number  of Existing  Shares then held. 
Entitlements  to apply to subscribe for Offer Shares will be rounded down to the 
nearest  whole number  and any  fractional entitlement  to Offer  Shares will be 
disregarded  in  calculating  the  Qualifying  Shareholder's  entitlement  (such 
fractional  entitlements being aggregated  and made available  for take up under 
applications for excess Offer Shares). 
 
To  the  extent  Shareholders  do  not  validly  apply  for  the  whole of their 
entitlement,   such   Offer   Shares  (together  with  aggregate  of  fractional 
entitlements   referred   to   above)  will  be  made  available  to  Qualifying 
Shareholders.  Qualifying Shareholders may apply for  any number of excess Offer 
Shares  which will, if more than the number of excess Offer Shares available are 
applied  for, be allocated and satisfied  pro-rata (rounding down to the nearest 
whole  Offer Share) to the number of shares  held by the applicant on the record 
date  (provided that an applicant shall not  be allocated more Offer Shares than 
applied for). 
 
The  issue  price  of  14p per  Offer  Share  represents a 28.2% discount to the 
unaudited  net asset value of 19.5p per ordinary share as at 31 March 2011 (this 
being  the  most  recently  published  net  asset  value).  Due  to  the  recent 
significant  reduction in  net assets  and poor  performance, the Board believes 
that  Qualifying Shareholders should  be given the  opportunity to subscribe for 
additional  ordinary shares in the  Company at a discount  prior to any proposed 
public  offer which  will be  at an  issue price  of NAV  plus costs.  The Board 
further  believes that a discount  is necessary for the  Shareholder Offer to be 
successful.  The level  of discount  reflects what  the Board  believes to be an 
appropriate  discount to make the Shareholder Offer attractive yet providing for 
an  issue price which is  above the offer price  (this being 10.5p as at 20 July 
2011). If  a Qualifying  Shareholder is  eligible to  receive VCT tax reliefs in 
respect  of the investment, the net cost  of an Offer Share (taking into account 
the  30% upfront income tax relief) will be 9.8p, this being a 49.7% discount to 
the NAV per Ordinary Share as at 31 March 2011 
 
SHAREHOLDER OFFER EXPECTED TIMETABLE 
 
Record date and time for the Shareholder Offer        5.00 p.m. on 20 July 2011 
 
Announcement of the Shareholder Offer 22 July 2011 
 
Latest time and date for proxy forms for the General Meeting         12.00 noon. 
on 13 August 2011 
to be received 
 
General Meeting 12.00 noon on 15 August 2011 
 
Latest  time and date  for receipt of  completed Application Forms 12.00 noon on 
19 August 2011 
under the Shareholder Offer 
 
Allotment  of Offer  Shares and  announcement of  the results of the Shareholder 
Offer 22 August 2011 
 
Date  of Admission  and commencement  of dealings  of the Offer Shares 23 August 
2011 
 
Share certificates for Offer Shares despatched 31 August 2011 
 
CANCELLATION OF SHARE PREMIUM AND CAPITAL RESERVES 
 
The  issue of new  shares pursuant to  the Shareholder Offer  will result in the 
creation  of further share premium. The Board considers it appropriate to obtain 
approval  of the  Company's shareholders  at the  General Meeting  to cancel the 
existing  and further  share premium  attributable to  shares issued pursuant to 
such  offer (subject to Court sanction) to create further distributable reserves 
to  fund distributions to  Shareholders and buy-backs,  to set off  or write off 
losses and for other corporate purposes of the Company. In addition, the Company 
has  a small  amount standing  to the  credit of  the capital redemption reserve 
resulting from buy-backs completed by the Company and Board considers it prudent 
to  obtain  approval  of  the  Company's  shareholders at the General Meeting to 
reduce its capital, subject to confirmation by the Court. 
 
FURTHER INFORMATION 
 
Shareholders  (other than  those in  a Restricted  Territory (as  defined in the 
Circular)) will receive a copy of the Circular convening the General Meetings to 
be  held  on  15 August  2011 at  which  shareholders will be invited to approve 
resolutions in connection with the Shareholder Offer and other proposals. A copy 
of  the Circular has also been submitted to the UK Listing Authority and will be 
shortly  available for inspection at the National Storage Mechanism which can be 
accessed at the website www.hemscott.com/nsm.do 
 
For further information, please contact: 
 
Foresight Fund Managers Limited 
Gary Fraser 
Telephone: 01732 471 809 
 
 
 
 
 
 
 
 
 
 
This announcement is distributed by Thomson Reuters on behalf of 
Thomson Reuters clients. The owner of this announcement warrants that: 
(i) the releases contained herein are protected by copyright and 
    other applicable laws; and 
(ii) they are solely responsible for the content, accuracy and 
     originality of the information contained therein. 
 
Source: Foresight 5 VCT PLC via Thomson Reuters ONE 
 
[HUG#1532948] 
 

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