Proposed Rollover of Assets from EOT
Summary by AI BETAClose X
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO, THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA, JAPAN, NEW ZEALAND, THE REPUBLIC OF SOUTH AFRICA, IN ANY MEMBER STATE OF THE EEA OR IN ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL
This announcement is not an offer to sell, or a solicitation of an offer to acquire, securities in the United States or in any other jurisdiction in which the same would be unlawful. Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.
This announcement contains inside information
29 May 2026
JPMorgan European Growth & Income plc
Legal Entity Identifier: 5493007C3I0O5PJKR078
Proposed rollover of assets from European Opportunities Trust PLC
The Board of JPMorgan European Growth & Income plc ("JEGI" or the "Company") is pleased to announce that it has signed Heads of Terms with the Board of European Opportunities Trust PLC ("EOT") in respect of a transfer of certain of the cash, assets and undertakings of EOT to the Company, to be effected by way of a section 110 scheme of reconstruction of EOT under section 110 of the Insolvency Act 1986 (the "Scheme").
EOT shareholders will have the option to: (i) rollover their holding into JEGI (which is the default option); and/or (ii) rollover their holding into new open-ended investment vehicle to be managed by EOT's existing manager; and/or (iii) elect for cash.
The Proposals, which are set out in further detail below, are expected to grow the Company's net assets, enhancing JEGI's position as a leading investment vehicle for European equity investing that delivers an attractive dividend yield. The scale of the enlarged JEGI should improve secondary market liquidity for JEGI's shareholders, enhance the profile of the Company, reduce the average management fee payable by the Company as a result of JEGI's tiered management fee structure and reduce the Company's ongoing charges ratio. Furthermore, a significant contribution from JPMorgan Funds Limited ("JPMF") allows such benefits to be provided on a cost-effective basis.
The Proposals
In connection with the Scheme, EOT will offer its shareholders the opportunity to elect for:
· new shares in the Company ("New JEGI Shares") (the "JEGI Rollover Option") as the default option; and/or
· shares in LT European Opportunities Fund ("LEO"), a sub-fund of Liontrust Investment Funds I ICVC to be established in connection with the Proposals (the "LEO Rollover Option", together with the JEGI Rollover Option, the "Rollover Options"); and/or
· cash (the "Cash Option").
EOT shareholders that make no election in respect of some or all of their EOT holding will receive New JEGI Shares in respect of such holding.
The Cash Option will be unlimited and will be offered at a 2 per cent. discount to the EOT net asset value after Scheme adjustments ("Cash Option Discount"). LEO is an open-ended fund to be managed by EOT's existing portfolio manager.
(The above proposals are referred to herein as the "Proposals".)
The Proposals follow a strategic review by the Board of EOT, and its decision to select JEGI as the closed-ended rollover option for EOT's shareholders reflects a range of strategic considerations, including the strong performance delivered by JEGI's award-winning portfolio managers, Alexander Fitzalan Howard, Zenah Shuhaiber and Timothy Lewis (the "Portfolio Managers"). JEGI has generated market leading returns over the one, three and five years to 27 May 2026 of 23%, 57% and 83%, respectively, materially outperforming the benchmark returns of 19%, 44% and 56%, and the closed-ended sector peer group average returns of 8%, 23% and 30%*.
JEGI's Portfolio Managers are supported by a team of more than 90 investment professionals. The team employs a disciplined and robust investment process that combines in-house fundamental analysis and quantitative research to identify high-quality stocks with attractive valuations and improving prospects. The strength of this process is best evidenced by JEGI's 5-star Morningstar rating and the Citywire AAA rating alongside a long-term track record of outperformance.
In addition to the strong performance of the Company, EOT shareholders that are deemed to elect for new JEGI Shares will benefit from the Company's policy of paying dividends based on 4% of net asset value ("NAV") per annum which provides an attractive level of income alongside capital growth. Further benefits include JEGI's proactive discount management policy of defending a single digit discount through the use of share buybacks and the Company also has a performance-related tender offer** in place as an additional protection for shareholders. JEGI's shares have traded around NAV throughout 2026, with the strongest rating in the AIC Europe sector.
The Board of JEGI believes that the Proposals will enable JEGI shareholders to benefit from the greater economies of scale that are expected to result from the enlarged asset base, including greater liquidity in JEGI shares and cost efficiencies.
Rita Dhut, Chair of the Company, commented:
"It is an exciting time to be investing in Europe. Enthusiasm for Europe's world-class companies is rising and we are delighted that the Board of EOT has selected JEGI as the default rollover option for its shareholders.
We believe that the investment trust structure provides a number of advantages for long-term investors which JEGI utilises for the benefit of its shareholders. We are proud that JEGI has delivered sector-leading performance, attractive income, and excellent value for its shareholders.
We are very aware that scale increasingly matters in the trust industry and recognise the desire for larger, more liquid vehicles that offer highly competitive cost structures. This transaction provides an opportunity for growth and will allow JEGI to appeal to an even wider array of investors."
Benefits of the Scheme
Both Boards believe that the Scheme has a strong rationale, which includes the following benefits for shareholders in the enlarged JEGI:
· Scale: The Proposals are expected to grow the Company's net assets, enhancing JEGI's position as a leading investment vehicle for European equity investing that delivers an attractive dividend yield. The scale of the enlarged JEGI should improve secondary market liquidity for JEGI's shareholders and enhance the profile of the Company;
· Lower management fee: JEGI will benefit from a lower management fee rate following the implementation of the Proposals as JEGI's tiered management fee will have the effect of reducing the weighted average fee given the growth in NAV. By way of illustration, based on valuations as at 27 May 2026, and on the assumption that elections are equal between the three options, JEGI's weighted average management fee would be 0.48% of NAV;
· Lower ongoing charges: existing and new shareholders in JEGI will benefit from the Company's already sector-lowest ongoing charges ratio***;
· Shareholder diversification: Since the Company's restructure in February 2022, the level of ownership of JEGI's shares by retail investors has risen from 35% to 57%. There is overlap between EOT's and JEGI's top shareholders, offering shareholders the opportunity to consolidate their investments into a larger, more liquid trust;
· Contribution from JPMF: JPMF has agreed to make a substantial cost contribution in respect of the Proposals which is outlined below.
Shareholder support
EOT has received indications of support from its shareholders representing approximately 47.8 per cent. of the EOT's issued share capital as at 28 May 2026, including:
· an irrevocable undertaking from Alexander Darwall, the portfolio manager of EOT, to, amongst other things, vote, or procure a vote, in favour of the Scheme and to elect, or procure an election, for the LEO Rollover Option, in each case in respect of Mr. Darwall's entire beneficial holding of EOT shares, representing approximately 4.5 per cent. of EOT's issued share capital; and
· letters of intent from certain other EOT Shareholders representing, in aggregate, approximately 14.4 per cent. of EOT's issued share capital to, amongst other things, vote, or procure a vote, in favour of the Scheme and to elect, or procure an election, for the LEO Rollover Option.
· indications of support for the Proposals from other EOT Shareholders, representing, in aggregate, approximately 28.9 per cent. of EOT's issued share capital.
Costs of the Proposals
JEGI and EOT each intends to bear its own costs incurred in relation to the Proposals, with such costs mitigated through manager contributions and the benefit of the Cash Option Discount.
JPMF Contribution
JPMF has agreed to make a contribution to the costs of the Scheme equal to twelve months of the incremental management fee payable to JPMF by the Company, calculated on the NAV of the cash, assets and undertakings transferring to the Company pursuant to the Scheme (the "JPMorgan Contribution").
The benefit of the JPMorgan Contribution will be allocated as follows and in the following order:
(a) first, for the benefit of JEGI, an amount to offset the transaction costs incurred by JEGI in connection with the Proposals ("JEGI Transaction Costs"); and
(b) second, for the benefit of EOT shareholders electing for the JEGI Rollover Option, an amount to offset the proportion of EOT transaction costs ("EOT Transaction Costs") in connection with the Proposals that is equal to the proportion of EOT's issued share capital that elects for the JEGI Rollover Option, to the extent not covered by the Cash Option Discount benefit (see below); and
(c) finally, any balance of the JPMorgan Contribution remaining is to be allocated to the benefit of the enlarged JEGI.
Devon Equity Management Limited ("Devon") Contribution
Devon, a subsidiary of River Global PLC, which has recently announced the sale of its investment management business to Liontrust Asset Management plc, has also agreed to make a contribution to EOT's costs, which will be allocated for the benefit of EOT shareholders electing for the LEO Rollover Option.
Cash Option Discount Benefit
The benefit of the Cash Option Discount will also be apportioned to offset the costs of the Proposals as follows:
(a) a proportion equal to the proportion of valid elections for the LEO Rollover Option as a percentage of aggregate elections for the Rollover Options shall be applied for the benefit of the LEO Rollover Option;
(b) a proportion equal to the proportion of valid elections for the JEGI Rollover Option as a percentage of aggregate elections for the Rollover Options, shall be applied as follows:
i. first, for the benefit of EOT shareholders electing for the JEGI Rollover Option, an amount to offset the relevant proportion of the EOT Transaction Costs;
ii. second, for the benefit of JEGI, an amount to offset the JEGI Transaction Costs (to the extent not already covered by the JPMorgan Contribution);
iii. third, for the benefit of JEGI, an amount as is sufficient to meet the enlarged JEGI's listing fees and other costs (if any) incurred in connection with the Proposal, to the extent that the pro-forma NAV per share of the enlarged JEGI would otherwise be diluted compared with JEGI's NAV per share as at the Scheme calculation date; and
iv. finally, any balance of the Cash Option Discount remaining will be allocated to the benefit of the EOT shareholders electing for the JEGI Rollover Option.
Scheme Calculations
The number of New JEGI Shares issued to EOT shareholders under the JEGI Rollover Option will be calculated on a Formula Asset Value ("FAV") to FAV basis.
The JEGI FAV shall equal the JEGI NAV, less the JEGI Transaction Costs (not reflected in the JEGI NAV), and adjusted for any dividends declared but not yet paid or accrued (to which the New JEGI Shares will not be entitled), the JPMorgan Contribution and the benefit of the Cash Option Discount, as set out above in the section 'Costs of the Proposals'.
The JEGI Rollover Option FAV shall equal the EOT NAV, less the EOT Transaction Costs (not reflected in the JEGI NAV) and such other amounts to be retained by the liquidator and adjusted for any dividends declared but not yet paid or accrued, the JPMorgan Contribution and the benefit of the Cash Option Discount, as set out above in the section 'Costs of the Proposals'.
New JEGI Shares issued to EOT shareholders under the JEGI Rollover Option shall be calculated based on a ratio of the JEGI Rollover FAV to the JEGI FAV.
Approvals and expected timetable
Implementation of the Proposals is subject to, amongst other things, the approval of the Company's shareholders as well as regulatory and tax approvals and approval by the shareholders of EOT.
The Company will publish a circular to convene a general meeting of JEGI shareholders to approve the issue of New JEGI Shares pursuant to the Proposals. At the same time, EOT will publish a circular setting out full details of the Proposals and to convene the necessary general meetings to implement the Scheme. It is anticipated that such shareholder documentation will be published by early July 2026.
Subject to the relevant conditions being satisfied, it is expected that the Scheme would be completed in August 2026 or shortly thereafter.
*Source: Morningstar, data to 27 May 2026.
**The Performance-Related Tender Offer is proposed to be made for up to 25% of the issued share capital of the Company (excluding treasury shares) in the event that the NAV total return of the Company does not equal or exceed the total return of the Benchmark over the five-year period commencing on 4th February 2022, being the first day of trading in the Ordinary Shares. The Performance-Related Tender Offer allows Shareholders to realise the value of a portion of their Ordinary Shares at the NAV per Ordinary Share, less costs.
***JEGI's ongoing charges for the year ended 31 March 2026 were 0.64%.
For further information please contact:
|
JPMorgan European Growth & Income plc Rita Dhut
|
Contact via Company Secretary |
|
JPMorgan Funds Limited Simon Elliott Neil Martin William Talkington
|
+44 (0) 20 7742 4000 |
|
JPMorgan Funds Limited (Company Secretary) Paul Winship
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+44 (0) 20 7742 9815 |
|
Winterflood Investment Trusts Neil Langford Haris Khawaja
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+44 (0) 20 3100 0000 |
Important Information
This announcement contains information that is inside information for the purposes of Article 7 of the UK version of Regulation (EU) No. 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended. The person responsible for arranging for the release of this announcement on behalf of JEGI is Paul Winship of JPMorgan Funds Limited ("JPMF"), the Company's Alternative Investment Fund Manager.
The information in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. The material contained in this announcement is given as at the date of its publication (unless otherwise marked) and is subject to updating, revision and amendment. In particular, any proposals referred to herein are subject to revision and amendment.
The New JEGI Shares have not been, and will not be, registered under the U.S. Securities Act of 1933 (as amended) (the "Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an exemption from registration under the Securities Act. Moreover, the New JEGI Shares have not been, nor will they be, registered under the applicable securities laws of Australia, Canada, Japan, New Zealand, the Republic of South Africa, or any member state of the EEA (other than any member state of the EEA where the shares are lawfully marketed). Further, JEGI is not, and will not be, registered under the US Investment Company Act of 1940, as amended.
The value of shares and the income from them is not guaranteed and can fall as well as rise due to stock market and currency movements. When you sell your investment you may get back less than you originally invested. Figures refer to past performance and past performance should not be considered a reliable indicator of future results. Returns may increase or decrease as a result of currency fluctuations.
This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "may", "might", "will" or "should" or, in each case, their negative or other variations or similar expressions. All statements other than statements of historical facts included in this announcement, including, without limitation, those regarding JEGI's financial position, strategy, plans, proposed acquisitions and objectives, are forward-looking statements.
Forward-looking statements are subject to risks and uncertainties and, accordingly, JEGI's actual future financial results and operational performance may differ materially from the results and performance expressed in, or implied by, the statements. These forward-looking statements speak only as at the date of this announcement and cannot be relied upon as a guide to future performance. Subject to their respective legal and regulatory obligations, each of JEGI, JPMorgan Asset Management (UK) Limited ("JPMAM") and JPMF expressly disclaims any obligations or undertaking to update or revise any forward-looking statements contained herein to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based unless required to do so by law or any appropriate regulatory authority.
Winterflood Securities Limited ("Winterflood") which is authorised in the United Kingdom by the Financial Conduct Authority is acting exclusively for JEGI and for no-one else in connection with the Proposals, will not regard any other person as it client in relation to the Proposals and will not be responsible to anyone other than JEGI for providing the protections afforded to its clients or for providing advice in relation to the Proposals, or any of the other matters referred to in this announcement. This does not exclude any responsibilities or liabilities of Winterflood under the Financial Services and Markets Act 2000, as amended, or the regulatory regime established thereunder.
None of JEGI, JPMAM, JPMF or Winterflood, or any of their respective affiliates, accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to this announcement, including the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to any of them, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith. Each of JEGI, JPMAM, JPMF and Winterflood, and their respective affiliates, accordingly disclaim all and any liability whether arising in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.
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