Yeoman Investment Trust PLC
3 April 2002
YEOMAN INVESTMENT TRUST PLC
Suspension of monthly dividend distributions
Proposed cancellation of share premium account and buy-back authority to
purchase Zero Dividend Preference shares ('ZDPs')
On 22 March 2002, the Board of Directors made an announcement to the London
Stock Exchange stating that, as a consequence of falling dividend receipts from
the Company's investments in split capital investment trusts, it would be
reducing the level of the monthly dividend payment from 0.95 pence to 0.7 pence.
Your Board now announces that, while the interim dividend of 0.95 pence per
Income share declared on 8 March 2002 will be paid on 12 April 2002, the Company
has had to suspend payment of dividends until further notice. This is because
the continuing fall in the market, particularly in the values of other split
capital investment trusts, has resulted in a further decline in the net assets
of the Company such that the Company is currently prohibited by Sections 264 and
265 Companies Act 1985 from paying any further dividends.
In order to enable the Company to pay dividends in the future, notwithstanding
further possible falls in asset values, the Board is also announcing that the
Company will be seeking shareholders' approval at an extraordinary general
meeting to be held immediately after the annual general meeting on 2 May 2002
for the cancellation of the Company's share premium account. At the same time,
they will seek shareholders' authority for the Company to purchase up to 100 per
cent. of its own ZDP shares. It is the Board's intention that any purchases of
ZDP shares made pursuant to this authority would be made through the market for
cash at prices below their accrued capital entitlement and that the minimum
price to be paid for a ZDP share shall be 1p.
The cancellation of the Company's share premium account requires the
confirmation of the Court and the consent of the Company's creditors. Once that
confirmation and consent have been obtained, the new special reserve created by
the cancellation should enable the resumption of payment of dividends from
revenue and reserves. The special reserve will also be available for purchase
of the ZDP shares.
The Company will, therefore, be suspending the payment of its monthly dividends
until the cancellation of the share premium account has been confirmed. Subject
to the passing of the necessary resolutions and to the obtaining of the
confirmation of the Court and creditors' consent, the Board expects the Company
should be in a position to resume the payment of dividends by the end of July
2002, subject to the underlying performance of the Company's investments.
The Company will be posting a circular to shareholders setting out these
proposals in further detail. This circular will accompany the Company's annual
report and accounts which will be posted to shareholders on Friday 5 April 2002.
3 April 2002
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