NB Global Monthly Income (NBMI) has announced that, following a review of its strategy and future prospects, its Board has decided not to implement its semi-annual cash exit facility in December 2022 but instead to put forward proposals for approval by shareholders to place the company into a managed wind-down.
Wind-down triggered by NAV dropping below £150m
When the semi-annual cash exit facility was introduced, the company’s Board stated that it intended to propose a wind-down should the NAV drop beneath £150m in the future. As at 17 November 2022, the Company’s NAV was £178.6m and the Board anticipated that the likely participation in the December cash exit offer would result in the company’s NAV falling below the £150m threshold. Given that probable outcome, combined with the company’s persistent share price discount to NAV per share and recent feedback from shareholders, the Board says that it believes that it is in the best interests of the company and shareholders that the company be placed into a managed wind-down.
Orderly wind-down
Under the proposals, the Board anticipates that the company’s assets would be realised in an orderly manner and capital distributions would be made as and when sufficient cash is realised “to make it economically expedient to make a distribution”. Following the approval of a revised investment policy in September 2020, the company’s portfolio consists of both liquid and less liquid assets that will take varied time periods to sell down so as to maintain shareholder value. Based on current and anticipated market conditions, it is expected that the process of realising the most illiquid assets in the company’s portfolio could require a period of up to 24 months. There is, however, no guarantee that assets will be realised within a particular time frame. Capital distributions will always be made at the Board’s discretion.
Further analysis on the liquidity of the portfolio and the expected timings of capital distributions to shareholders will be provided in due course. It is intended that the listing of the company’s shares would be maintained during the wind-down period until the extent of the realisation process is such that it is appropriate to put forward proposals to shareholders to place the company into formal liquidation. The company intends to publish a circular by the end of this year setting out the full details of the proposals and convening an extraordinary general meeting in late January 2023 at which shareholder approval for the proposals will be sought.