Chelverton Small Companies Dividend Trust Share Issue - Now CLOSED

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The Chelverton Small Companies Dividend Trust Plc - C Share Issue is now CLOSED

27th May 2018

NOT FOR RELEASE, PUBLICATION, DISTRIBUTION OR TRANSMISSION, DIRECTLY OR INDIRECTLY, IN OR INTO, THE UNITED STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, JAPAN, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA (OTHER THAN THE UNITED KINGDOM) OR IN ANY OTHER TERRITORY WHERE TO DO SO WOULD BREACH APPLICABLE LAWS OR REGULATIONS.

Chelverton Small Companies Dividend Trust - C Share offer overview

Expected Timetable

  • Offer Open

    24th November 2017

  • Offer Closes:

    21st December 2017

  • Allocation announced:

    22nd December 2017

  • Trading begins:

    8th January 2018


About Chelverton Small Companies Dividend Trust

A boutique fund manager, founded in 1998, with quoted assets under management of £740m. The fund management team are small and mid-cap specialists. Chelverton Small Companies Dividend Trust was launched in 1999 (the “Trust”, “SDV” or the “Company”).

The Trust seeks to provide high and growing income alongside the opportunity for capital growth. The investment strategy seeks to capture the long-term outperformance of small and mid-cap stocks, combined with an above average dividend yield. Portfolio construction seeks to balance income and capital appreciation to smooth returns, deliver a long-term high and growing dividend and medium-term capital growth without taking undue stock specific risk.

Use of Proceeds

The Company expects to have deployed the net proceeds attributable to the Shares issued pursuant to the Issue in a portfolio of investments within four months of Initial Admission. The Company’s funds will be invested principally in companies with a market capitalisation of up to £500 million; a maximum of 20 per cent. of the Group’s portfolio may be invested in companies without reference to their market capitalisation at the discretion of the Investment Manager.

Highlights
  • Gross Assets- £59.22m (£46.53m net assets).
  • Portfolio yield- 4.4%.
  • The Trust's portfolio comprises companies listed on the Official List and companies trading on AIM.
  • The investment strategy comprises:

    -- Valuation is based around the dividend.

    -- The sale process is based on a yield appraisal. Stocks tend to be sold below a 2% prospective yield. This is a key valuation discipline and also ensures that the fund will continue to retain a high portfolio yield.

    -- The trust has sell targets at a higher yield for some stocks that have lower dividend growth prospects and stocks are reviewed on dividend cuts or lower rates of growth compared to our expectations.

    -- Minimum 50 stocks.

    -- Top 10 stocks currently represent 22% of the portfolio.

    -- Largest holding is limited to 5% of gross assets, and currently represents 2.80%.

    -- No more than 5% of the income can be generated from a single stock and currently the highest income contributor represents 3.64%.
  • The Trust has generated an annualised return of 23.3% over the last five years, with its NAV rising by 193.8% on a total return basis vs a sector average increase of 78.4%.

Risks*
  • Political instability may impact on the share price and/or the Net Asset Value of the Company. The United Kingdom has voted to leave the European Union (“Brexit”). The impact of Brexit on general economic conditions and financial markets as well as the United Kingdom’s legal and regulatory system is unclear and will depend largely on political decisions and negotiations.
  • In the Company’s opinion, the Group does not have sufficient working capital for its present requirements, that is, for at least 12 months following the date of this prospectus.
  • The Company may be materially adversely affected to the extent their reputations are harmed. As noted in paragraph 6(b) of Part IX of this Prospectus, the Serious Fraud Office is investigating the activities of Balli Group PLC.
  • Impact of European regulation including MiFID II.
  • There can be no assurance that the Investment Manager will be successful in implementing the Company’s investment objective.
  • Market risks.
  • AIM investment risks.
  • Other risks.

*Please note that these risks represent the judgement of Cornhill Capital, there may be additional risks represented in the prospectus


Offer Documents

Important information

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