2006 News Archive

14th November 2006

Latest flotation PR marketing for Japenese retail estate fund

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, CANADA, JAPAN OR AUSTRALIA

This announcement does not constitute or form any part of an offer or invitation to sell or issue, or any solicitation of an offer to purchase or subscribe for, any shares in Prospect Epicure J-REIT Value Fund PLC, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract thereof.  The contents of this announcement have not been approved by an authorised person and recipients of this announcement who intend to purchase or subscribe for shares in Prospect Epicure J-REIT Value Fund PLC following its publication of an admission document in final form are reminded that any such purchase or subscription may only be made on the basis of the information contained in such document which may be different from the information contained in this announcement. Accordingly, no reliance may be placed for any purpose whatsoever on the information contained in this announcement or on its completeness. No representation or warranty, express or implied, is given by Prospect Epicure J-REIT Value Fund PLC, its directors, Panmure Gordon, Helvetica Wealth Management Partners (Asia) Pte Limited, Prospect Asset Management, Inc or any other professional adviser as to the accuracy or completeness of the information and opinions contained in this announcement and no liability is accepted for the same.

Prospect Epicure J-REIT Value Fund PLC: First Day of Dealings on AIM and Placing

Prospect Epicure J-REIT Value Fund PLC (the “Company”) is pleased to announce its admission to trading today on AIM. The Placing has raised gross proceeds of £101 million. The Company’s share capital comprises 101,000,000 Ordinary Shares (ticker: PEJR) issued at 100p and in addition, 20,200,000 warrants have been issued on a 1 for 5 basis (ticker: PEJW).

The Company

Prospect Epicure J-REIT Value Fund PLC is a newly incorporated Isle of Man company established to invest predominantly in Japanese Real Estate Investment Trusts (“J-REITs”). Its share capital is denominated in Sterling and consists of a single class of Ordinary Shares, with Warrants attached on the basis of one Warrant for every five Ordinary Shares. Each Warrant entitles the holder to subscribe for one Ordinary Share at a price of 110 pence from Admission until 1 March 2010. In the absence of unforeseen circumstances, the Manager and Investment Adviser currently anticipate that such net proceeds should be fully invested within 6 months of Admission.

The Manager

Epicure Managers Japan Limited has been appointed by the Company as Manager and will be responsible for the management of the Company’s assets and in particular, for retaining the services of the Investment Adviser.

The Investment Adviser

Prospect Asset Management, Inc., a limited company incorporated in Hawaii, has been engaged by the Manager and the Company to act as Investment Adviser pursuant to the Investment Advisory Agreement. The Investment Adviser will be responsible for managing and advising the Company as to the management and investment and re-investment of the assets of the Company and to monitor the performance and operation of the same and for managing the borrowings anticipated to be part of the Company’s strategy, subject always to the overall policies, direction and control of the Board and the Manager and in accordance with the investment policy and investment restrictions.

The key individuals employed by Prospect are:

Curtis Freeze (Chairman)

Curtis founded Prospect in September 1994.  He serves as chairman of Prospect Company Limited, and a director of Prospect Asset Management (Channel Islands) Limited and Prospect Residential Advisors.  Prior to 1994, Curtis was portfolio manager for Deutsche Morgan Grenfell Asset Management in Tokyo specialising in Japanese smaller companies.  He has also worked with Lehman Brothers and Nikko Securities in Tokyo. Curtis received an MBA from the University of Hawaii in December 1987.

Alex Kinmont (Managing Director)

Alex joined Prospect in April 2005 and is responsible for analysis of real estate securities and physical real estate investments and provides strategic advice to the Prospect Asset Management Investment Committee. He was previously chief strategist in Japan for NikkoCitigroup and also for Morgan Stanley.  He began his career as a real estate analyst in Tokyo in the mid 1980's.  After becoming a strategist in 1993, Alex maintained consistently high rankings in the most prestigious industry surveys including Greenwich Associates and Institutional Investor. Alex received his BA Litterae Humaniores (Latin and Greek Literature and Ancient History) at Oxford University.  He has lived in Japan for 15 of the last 20 years and is fluent in Japanese.

Daniel Kerrigan (Head of Trading)

Dan is CEO and head of trading of Prospect Asset Management, Inc.  Dan joined Prospect in June 2005 from UBS Japan, where he was managing director of the Hedge Fund Sales Desk.  Prior to focusing on hedge funds, Dan was head of sales trading and execution at UBS, leading a team which was consistently ranked in the Greenwich Associates survey.  A 15 year resident of Tokyo, Dan has also worked at NatWest Markets and Credit Suisse.  He began his career as a Japanese equity sales trader at Yamaichi Securities in New York in 1987.  Dan has a BA in English Literature and an MBA from the University of Notre Dame.

Investment Policy

The investment policy will be flexible, with the Company being permitted to invest in all listed J-REITs and vehicles of a similar type (for instance, listed property trusts in Australia, the assets of which the Investment Adviser believes to be real property exclusively in Japan) which benefit from tax advantages and own physical real estate located in Japan and cash or cash equivalents. The Company will typically invest in listed securities, but will be permitted to invest no more than 10 per cent. of its assets (measured at the time of investment) in unlisted securities which are expected to list within 12 months and may continue to hold securities that cease to be listed. Once the Company is fully invested in accordance with its investment policy, the Investment Adviser anticipates that the initial portfolio will comprise approximately 15 to 20 holdings and between 3 and 5 of these positions will be a particular concentration of the portfolio’s investment.

Investment Philosophy and Approach

The Manager and the Investment Adviser intend to adopt an active management approach in order to exploit opportunities within the Company’s investment universe. The Company will seek to maximise total returns to investors by accessing and leveraging three potential sources of return. First, the dividend yield currently available from J-REITs; second, potential appreciation in J-REIT prices as a result of a continued recovery in Japanese property values; and third, the potential closing of the discount of property assets to NAV currently identified by the Investment Adviser.

Hedging

The Company does not intend to hedge the exchange rate risk between Sterling and Yen.

Dividend Policy

The Company’s target dividend yield is 7 per cent. of the Placing Price per annum once the net proceeds of the Placing have been converted into Yen and fully invested in J-REITs* and it aims to achieve an IRR in excess of 20 per cent. per annum. The Board anticipates that the Company will pay dividends on a semi-annual basis but will also consider paying other dividends from time to time if they believe that the financial position of the Company justifies it. The income from J-REITs will be denominated in Yen and dividends paid in Sterling, therefore, the Company is likely to have some exposure to variations and currency exchange rates which might affect the Company’s ability to achieve its target dividend yield.

* The above returns are illustrative and based on a number of assumptions (including but not limited to the assumption that J-REITs will continue to pay dividends and that capital gains will be generated) which may not materialise or be achieved. There can be no guarantee that the Company will generate the returns set out above. None of the above should be taken as a forecast of profits.

Panmure Gordon acted as nominated adviser, placing agent and broker. Helvetica Wealth Management Partners (Asia) Pte Limited acted as distribution adviser.

Alex Kinmont, Managing Director of Prospect Asset Management, Inc., commented:
“We are delighted with the level of support from investors globally. We look forward to deploying the funds raised in a portfolio of J-REITs and generating value for shareholders. On our numbers, the Japanese real estate market has substantially underperformed almost all other major international property markets over the last 15 years and despite the first sustained signs of recovery, it currently trades at only two thirds the level reached in 1992, and at significant discounts to the UK and US. With the general economic indicators looking more favourable, Japan’s recovery, albeit nascent, underpins rents and capital values. Supply and demand points to asset price rises. The quoted Japanese real estate sector (excluding J-REITS) appears to us to have anticipated a continuation of the recovery, but J-REITs remain priced for continuation of a slump.”

For further information, please contact:

Prospect Epicure J-REIT Value Fund PLC

David von Simson: +44 (0)20 7661 9338

Prospect Asset Management,

Inc.+1 808 396 7077
Curtis Freeze
Alex Kinmont

Helvetica Wealth Management Partners (Asia) Pte Limited

James Schwegler: +65 6550 9880

Panmure Gordon

+44 (0)20 7459 3600
Richard Gray
Andrew Potts

Adventis Financial PR

Peter Binns: +44 (0)20 7034 4760
Annie Evangeli: +44 (0)20 7034 4757
Tarquin Edwards: +44 (0)20 7034 4758

Defined terms have the meaning set out in the Admission Document dated 9 November 2007

Panmure Gordon (Broking) Limited (acting as nominated adviser, placing agent and broker) and Helvetica Wealth Management Partners (Asia) Pte Limited (acting as distribution adviser) are advising Prospect Epicure J-REIT Value Fund PLC and no-one else in relation to the proposed placing of ordinary shares in the capital of the Company (the "Placing") and the proposed application for admission ("Admission") of the entire issued and to be issued share capital of the Company to trading on AIM and will not be responsible to anyone other than Prospect Epicure J-REIT Value Fund PLC for providing the protections afforded to customers of Panmure Gordon (Broking) Limited or Helvetica Wealth Management Partners (Asia) Pte Limited for providing  advice in relation to the proposed Admission.

buy or subscribe for ordinary shares in the Company in any jurisdiction to whom or in which such offer or solicitation is unlawful and, in particular, is not for release, publication or distribution in or into the United States, Australia, Canada or Japan or (including their territories, possessions and all areas or territories subject to their jurisdiction) or to any national, resident or citizen of the United States of America, Canada, Australia or Japan or to any corporation, partnership or other entity created or organised under the laws thereof, or to any persons in any other country outside the United Kingdom where such release, publication or distribution may lead to a breach of any legal or regulatory requirement.

This announcement does not constitute a recommendation concerning the Placing. The value of shares can go down as well as up.  Past performance is not a guide to future performance.  Potential investors should consult a professional adviser as to the suitability of the Placing for the investor concerned.

This document is not an offer of securities for sale in the United States of America, its territories or possessions (the "United States"). The shares to be offered in the Placing have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States or to any "US person" (as defined in Regulation S under the Securities Act) except pursuant to an exemption from the registration requirements thereof. The Company does not intend to conduct a public offering of shares in the United States.

Certain information contained in this announcement includes forward-looking statements. Such forward-looking statements are not guarantees of future performance. These statements are based on current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, including the risks to be described in the admission document. The Company does not undertake, not does it have any obligation, to provide updates or to revise any forward-looking statements except as may be required by applicable law and regulation (including the AIM Rules)