Review of Capital Structure
Following the recent significant falls in the value of the Company's
investments, the Board, in consultation with its advisers, has been reviewing
various options available to the Company which it considers will be of benefit
to shareholders as a whole and has sought the views of certain significant
shareholders on these matters. Although the review is at a very early stage,
these options have included a repayment of all or a significant part of the
existing bank debt and a tender offer for up to 50% of the issued zero coupon
preference shares at above the current market price but below their Net Asset
Value ('NAV') or a tender offer for up to 50% of the issued zero coupon
preference shares at around their NAV coupled with an extension in the life of
the Company for five years beyond the planned winding up date in December 2003.
Subsequent to these discussions and in the light of continued weakness in
equity markets, the Board is aware of the Company's proximity to its banking
covenants and has begun discussions with the Company's bankers with a view to
reducing bank debt to approximately £20 million. As at 30 September 2002, the
Company had bank borrowings of approximately £51 million.
In the meantime, the Board continues to explore a number of options with the
Company's advisers and significant shareholders with a view to fairly balancing
the rights and expectations of the different classes of shares and a further
announcement will be made in due course. However, it is not expected that the
Company will be in a position to make a further announcement or issue proposals
before 14 November 2002 at the earliest.
Enquiries: Neil Massie, LeggMason Investors, 020 7537 0000