GRMP Grampian

TIDMGRMP

RNS Number : 1360F

Grampian Investment Trust Plc

12 June 2012

   To:     RNS 

Date: 12 June 2012

Grampian Investment Trust plc ("Grampian" or the "Company")

Proposed reconstruction of the Company

As stated in the prospectus published by Grampian on its admission to the Official List, the Board has been considering options to increase the size of the Company, possibly through a merger with another investment trust.

Following careful consideration of the options available to the Company the Board is pleased to announce that it has agreed in principle to merge Grampian's assets with Troy Income & Growth Trust plc ("TIGT"). The merger will be subject to the approval of the Grampian shareholders.

TIGT is a UK growth and income investment trust with the same investment objective as Grampian and managed by the same investment manager, Troy Asset Management. Its principal objective is to provide shareholders with an attractive income yield and the prospect of income and capital growth through investing in a portfolio of predominantly UK equities.

TIGT's policy is to ensure that its shares always trade at close to net asset value through a combination of share buy-backs coupled with the issue of new shares at a small premium to net asset value where demand exceeds supply.

TIGT's investment performance track record since Troy Asset Management became investment manager is set out below.

 
                       Since Troy 
                       appointment   2 years   1 year    6 months 
-------------------  -------------  --------  --------  --------- 
 Share price total 
  return                 +70.5%       +27.4%    +10.6%     +8.5% 
-------------------  -------------  --------  --------  --------- 
 
  NAV total return       +53.6%       +21.9%    +5.4%      +4.8% 
-------------------  -------------  --------  --------  --------- 
 FTSE All Share 
  total return           +39.1%       +11.4%    (2.0%)     +6.3% 
 

The benefits of the proposals for Grampian shareholders are as follows:

-- TIGT's investment objective and policy are substantially the same as Grampian's and TIGT is managed by the same investment manager with a strong track record.

-- Grampian shareholders are expected to receive a similar dividend yield on the new TIGT shares.

-- TIGT has a lower total expense ratio than can be achieved by Grampian in its current form.

-- TIGT operates a discount control mechanism which should significantly reduce the risk that shares will trade at a material discount to their net asset value.

-- TIGT has a current market capitalisation of over GBP81 million which will provide considerably improved liquidity for Grampian shareholders.

TIGT has also announced today proposals to issue new shares to another UK investment trust which should further increase the size of TIGT, reduce its total expense ratio and increase liquidity.

The proposals are expected to be effected by means of a section 110 scheme of reconstruction. Under the terms of the scheme, TIGT is expected to issue its shares on a NAV for NAV basis and Grampian will make a contribution to TIGT to ensure that the proposals do not result in any dilution for TIGT's existing shareholders.

Further details on the proposals are expected to be issued shortly and it is expected that the scheme will become effective in late July/early August.

Enquiries:

Douglas Armstrong, Dickson Minto W.S. Tel: 020 7649 6823

Steven Cowie, Personal Assets Trust Administration Company Ltd, Company Secretary Tel: 0131 538 6604

This information is provided by RNS

The company news service from the London Stock Exchange

END

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