• by  • November 16, 2016 • Amedeo

    Amedeo Air Four Plus Limited

    16 November 2016

    Publication of Circular AND NOTICE OF EXTRAORDINARY GENERAL MEETING

    NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, TO US PERSONS OR INTO OR WITHIN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR, WITHIN THE EEA, OUTSIDE THE UNITED KINGDOM. THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES, AUSTRALIA, CANADA, SOUTH AFRICA OR JAPAN OR ANY JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION IS UNLAWFUL.

    The Company has today published a shareholder circular (the “Circular”) containing details of proposals for the Company to acquire, in accordance with its investment policy, two Airbus A380-800 aircraft (the “New Assets”) for leasing to Etihad Airways PJSC (the “Proposed Acquisitions”).

    A copy of the Circular is available on the Company’s website: http://www.aa4plus.com/.

    Shareholder approval by ordinary resolution is required by the Company’s articles of incorporation in order to proceed with the Proposed Acquisitions described in the Circular. Accordingly, a notice convening an extraordinary general meeting of the Company (the “EGM”) is included with the Circular.

    At the EGM, to be held at 11:00 a.m. on 14 December 2016 Ground Floor, Dorey Court, Admiral Park, St Peter Port, Guernsey, GY1 2HT, a resolution will be put to Shareholders to approve proposals with respect to the Proposed Acquisitions set out in the Circular.

    background to the proposed acquisitions

    The Company’s investment objective is to obtain income returns and a capital return for its Shareholders by acquiring, leasing and then selling aircraft. The Company’s investment policy is to pursue its investment objective by seeking to use the net proceeds of placings and/or other equity raisings, together with financing facilities (or instruments), to acquire widebody, or other, aircraft which will be leased to one or more major airlines.

    Since its successful initial public offering in May 2015 at 100 pence per Share, the Company has acquired six Airbus A380-800 and two Boeing 777-300ER aircraft (the “Current Assets”), each of which has been leased to Emirates Airlines for a term of 12 years. The Company has had full income generation since its launch and has paid dividends at its target rate of 2.0625 pence per Share per quarter each quarter since July 2015 (amounting to an annual income distribution of 8.25 pence per Share). Since launch, therefore, investors have received 12.375 pence per Share in dividend payments and have seen an increase in the market price of the Shares from the initial issue price of 100 pence per Share in May 2015 to 104 pence per Share as at 15 November 2016.

    The seventh and eighth aircraft were acquired following the initial placing (the “July 2016 Placing” under a placing programme commenced in June 2016 (the “Placing Programme”), which successfully raised £41,055,000 million gross proceeds to fund those acquisitions. Following the July 2016 Placing, the Company’s market capitalisation stood at approximately £350,000,000 million. The Placing Programme, which remains open until 27 June 2017, is being conducted by the Company in accordance with a prospectus published on 28 June 2016 (the “Prospectus”). As stated in the Prospectus, the maximum number of New Shares which may be issued pursuant to the Placing Programme is 300,000,000. Under the July 2016 Placing, 40,250,000 New Shares were issued and, accordingly, 259,750,000 New Shares remain available for the Company to issue through subsequent placings under the Placing Programme for the purposes of acquiring further aircraft in accordance with the Company’s investment policy.

    It is now proposed that the Company acquire the New Assets for leasing to Etihad. The first New Asset would be acquired in March 2017 and the second in May 2017. As with the Current Assets, and in line with the Company’s investment policy, the Proposed Acquisitions will be financed through a combination of equity and debt or other financing arrangements, as such are more specifically described in the Circular (the “Proposals”).

    The Board, as advised by Amedeo, believes that the Proposed Acquisitions will enable the Company to maintain its target dividend yield and to continue to generate a double-digit IRR (both the target dividend yield and the potential IRR are based on assumptions and projections which are more fully described in the Circular). Additionally, the Proposed Acquisitions will support the Company in the pursuit of its strategic aims to diversify its sources of income and to increase the size of the Company, potentially improving the liquidity in its Shares.

    Contingent on Shareholder approval being obtained for the Proposed Acquisitions, the Board intends to conduct a further placing under the Placing Programme through which New Shares in the Company will be issued in order to fund the equity portion of the acquisition costs of the New Assets (the “Proposed Placing”). Based on a USD/GBP exchange rate of 1.2402:1 as at the date of the Circular, and assuming an issue price of 104 pence per New Share, the Company anticipates targeting a raise of approximately £130,000,000. Following the completion of the Proposed Placing, the Company will enter into financing arrangements with lenders to fund the balance of the acquisition costs of each New Asset.

    The Board believes that the Proposals are in the best interests of the Company and its Shareholders as a whole and recommends that Shareholders vote in favour of the Resolution at the EGM. Shareholders are therefore urged to complete and return their Form of Proxy without delay, whether or not they intend to attend the EGM.

    Timetable for the EGM

    Record date for participation and voting at the EGM

    6:00 pm on 12 December 2016

    Latest time and date for the receipt of the Forms of Proxy for the EGM

    11:00 am on 12 December 2016

    Extraordinary General Meeting

    11:00 am on 14 December 2016

    Terms used and not defined in this announcement shall have the meaning given in the Circular.