26th May 2020 17:57
(Alliance News) -Â SQN Secured Income Fund PLC on Tuesday said it has posted a circular to shareholders explaining why the board does not think the company can continue in its current form indefinitely.
The directors are recommending shareholders vote against the continuation resolution at the general meeting convened for June 19.
"The directors acknowledge that the company has not, since launch, scaled in the manner the board, the manager and shareholders had hoped. The directors have been considering the future of the company in the light of this," SSIF said.
If the continuation resolution does not pass, the directors are required to convene a further general meeting within 90 days to consider a special resolution to approve the voluntary winding up or other reconstruction of the company.
"Regardless of the outcome of the general meeting, the board intends to undertake a strategic review into the future of the company and in particular intends to examine the likely returns to shareholders and timing of any managed wind down of the investment portfolio compared to other options to return capital to shareholders or the creation of a more liquid investment in a larger vehicle that would be listed on the London Stock Exchange," said SSIF.
Shareholders should note, SSIF added, that if it enters a managed wind-down, the company is unlikely to realise the full value of its investment portfolio and return the proceeds to shareholders for at least a period of "between three and four years", and "possibly longer", given the illiquid nature of the company's investments.
Shares in SSIF were untraded at 77.25 pence in London on Tuesday.
By Lucy Heming;Â [email protected]
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