Schroders said on Tuesday that its Board of Directors is announcing proposals for the enfranchisement of non-voting Ordinary Shares by simplifying its dual share structure.
The move by Schroder and its Board will provide all shareholders with the same voting rights because they share the same economic gains and dangers and it will also boost the shares’ liquidity.
Each Non-voting Share will be transformed into one Ordinary Share as part of the enfranchisement, and all re-designated shares will have the same rights as existing Ordinary Shares, including full voting rights.
Holders of Ordinary Shares will receive a bonus issue of three additional Ordinary Shares for every 17 Ordinary Shares held on a record date to be determined as compensation for the diminution of their voting rights under the proposed parameters of the enfranchisement.
The Board thinks that these terms are reasonable for both classes of shareholders and reflect the longer-term discount between the Non-voting and Ordinary Shares.
The proposals will be voted on separately by shareholders of both classes of shares. Further details of the plans, including resolutions on the enfranchisement, will be published in advance of a General Meeting, which will be conducted in due course, and will require 75% of votes cast by each class of shareholders to pass.
The Schroder family’s interests make up about 47.93% of the Ordinary Shares and 20.44% of the Non-voting Shares held by the Principal Shareholder Group (PSG).
Members of the PSG have stated that they intend to vote in favour of the proposals.
Holders of over 40% of the Non-voting Shares have indicated their willingness to support the proposals, along with other non-voting shareholders who have been contacted.
Following the enfranchisement, the PSG will own about 43.11% of the Ordinary Shares.
Michael Dobson, Chairman of Schroders, commented, “The Board believes it is right to enfranchise the Non-voting Shares and that these proposals are in the best interests of all shareholders.”
“In undertaking this important step for Schroders, we are pleased to have an indication from shareholders representing over 47% of the Ordinary Shares and over 40% of the Non-voting Shares that they intend to support the proposals.”
Schroders shares have rose marginally by 0.07% to 2,968p in early morning trade on Tuesday.