Placing & Open Offer, etc.
North Atlantic Smlr Co Inv Tst PLC
21 March 2000
The Board announces the following valuations of certain investments in the
Company.
- Horace Small Apparel PLC
At 9 March 2000 North Atlantic Smaller Companies Investment Trust PLC ('the
Company') held 5,662,466 shares in Horace Small Apparel PLC ('Horace Small')
representing 19.02% of Horace Small's share capital. The shares were suspended
following an announcement relating to the proposed acquisition of Redbus
Interhouse Limited, together with a Placing and Open Offer but dealings
recommenced in the existing ordinary shares on 10 March 2000.
As part of the Placing and Open Offer the Company will subscribe additional
1,887,508 shares at an issue price of 110p per share. Dealings are expected to
commence in the new ordinary shares on 5 April 2000, subject to the passing of
resolutions at an Extraordinary General Meeting on 3 April 2000.
At the time of the announcement of the proposed acquisition the share price of
Horace Small was 86.5p. Since that time the share price has significantly
appreciated and at the close of business on 20 March 2000 was 309p. There can
be no assurance as to whether or not the current share price will be
maintained.
- Arinco Computer Systems Inc.
On 20 March 2000 the Company received confirmation of its allocation of Series
B Convertible Preferred Stock ('Convertible Shares') in Arinco Computer
Systems Inc. ('Arinco'). The allocation was 110,000 Convertible Shares at
US$10.00 per Convertible Share. The Convertible Shares are unlisted but
convertible into Common Stock at any time with a conversion ratio of 40 Common
Stock for every one Convertible Share. At the close of business on 20 March
2000 the Common Stock price of Arinco was US$3.875.
To reflect the following:
i) the fact that the Convertible Shares are unlisted,
ii) the price volatility of the Common Stock,
iii) the disproportionately large amount of Convertible Shares in issue in
comparison to the Common Stock, and
iv) the thin trading volumes in the Common Stock
the Board has applied a 40% discount to the see-through value of the
Convertible Shares, resulting in a valuation of US$93.00 per Convertible
Share.
On the assumption that the resolutions put to Horace Small shareholders on 3
April 2000 are passed and that the current share price of 309p is maintained,
the above valuations give rise to an increase in the net asset value
(convertibles converted, options unexercised) of 108.65p per share over the
net asset value of the Company as at 29 February 2000, the latest valuation
date, of 624.26p per share.
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