It has also proposed the return of capital by way of future tender offers as the GHS portfolio is realised and confirmed that Harwood Capital has committed to manage the GHS portfolio for no fees during the managed wind-down period.
The board said that it believes the proposals would be “the fairest and most cost-effective and tax-efficient ways to effect returns of capital”.
A requisitioned general meeting will take place on 15 December 2021.
If the proposals are approved by shareholders, it will result in the realisation of all the company’s assets over a two-year period and the subsequent return of capital to shareholders.
In a statement, the board of GHS said that the company “will issue redeemable B Shares with an aggregate paid up nominal share capital equal to the amount of cash available for this purpose of approximately £10.4m, with such B Shares then immediately being redeemed for cash without further action being required by shareholders”.
It stated: “As the B Share Scheme will not effect a full return of the Augean proceeds and other cash available, the board proposes to supplement the B Share scheme with the tender offer, in order to return the balance of the free cash of approximately £14.6m to shareholders.”
It comes after the £466m trust announced on 11 October that it had decided to part ways with Gresham House Asset Management (GHAM) and instead appointed Harwood Capital as its investment manager, which would lead to the trust changing its name to Rockwood Strategic.
In November, shareholders accounting for almost half of the GHS investment trust’s total share capital called for an immediate return of cash and the realisation of its portfolio after the review was found to have been “inadequate”.
Former co-manager of GHS Richard Staveley is expected to act as a consultant to Harwood and Christopher Mills will act as lead fund manager.
The investment trust may undergo another name change should the proposals receive shareholder approval, to Rockwood Realisation.
In a statement, the GHS board said that “the board believes it may be appropriate from a cost perspective to de-list the company’s shares at the end of the two-year run-off period, or once 85% of the value of the company’s assets (as at today’s date) have been realised and returned to shareholders and the board will consult with shareholders at that time accordingly”.