LONDON, UK: The Board of Abrdn China Investment Company Limited (ACIC) has agreed heads of terms in principle for a proposed combination of the company with the assets of Fidelity China Special Situations PLC, a notice said.

ACIC believes the proposals will benefit shareholders in the company going forward.  Fidelity China is the top performing as well as the largest and most liquid UK investment trust investing in China. 

The combination, if approved by each company’s shareholders, will be implemented through a Guernsey scheme of reconstruction under which the Company will be placed into voluntary liquidation and part of its cash, assets and undertaking will be transferred to Fidelity China in exchange for the issue of new ordinary shares in Fidelity China to Shareholders.

Helen Green, Chair of Abrdn China Investment Company Limited (ACIC), said: “After a very thorough review process, including consultation with the Company’s major shareholders, the Board has concluded that the best practicable option to address the Company’s over-concentrated register and to provide significantly improved liquidity to our shareholders is to merge with Fidelity China, which is both sizeable and the clear leader in the China investment company sector.”

Key benefits of the Proposals:

• Fidelity China is the top performing UK listed investment company specialising in China over 1, 3, 5 and 10 years by NAV total return.
• Fidelity China, which was launched in 2010, is also the largest UK listed investment company specialising in China with net assets as at 31 October 2023 of £1.1 billion.
• ACIC shareholders rolling over into Fidelity China are likely to benefit from the far greater liquidity available in the market for Fidelity China shares, should they subsequently wish to realise their investment.
• The Proposals include a cash exit opportunity of up to 33 per cent of ACIC’s shares in issue, at a 2 per cent discount to formula asset value (“FAV”) per ordinary share.
• Fidelity China’s manager, FIL Investment Services (UK) Limited, has demonstrated its support for the Proposals by offering to underwrite a portion of the costs of implementing the Proposals.

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