Proposed combination with AUSC

JPMorgan UK Small Cap Grwth&Inc PLC

18 September 2026

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18 September 2026

JPMorgan UK Small Cap Growth & Income plc ("JUGI" or the "Company")

Legal Entity Identifier: 549300PXALXKUMU9JM18

Proposed combination with Aberdeen UK Smaller Companies Growth Trust plc ("AUSC")

Introduction

The boards of JUGI and AUSC are pleased to announce that heads of terms have been agreed for a combination of AUSC and JUGI. The combination is the culmination of a competitive private review process undertaken by the AUSC board, which both boards believe offers the best outcome for AUSC's shareholders as well as delivering meaningful benefits for existing JUGI shareholders. The combination is to be implemented through a proposed members' voluntary winding up of AUSC by way of a scheme of reconstruction of AUSC under Section 110 of the Insolvency Act 1986 (the "Scheme"). Pursuant to the Scheme, AUSC shareholders will be entitled to receive new shares in JUGI ("New JUGI Shares") or to elect some or all of their shares for cash, subject to an aggregate limit of 35 per cent. of AUSC's share capital. The Scheme and the issue of New JUGI Shares are, together, the "Proposals".

Following implementation of the Proposals, the enlarged JUGI ("enlarged JUGI") will continue to be managed by JPMorgan Funds Limited (which has delegated the management of the Company's portfolio to JPMorgan Asset Management (UK) Limited, together "JPMF") in accordance with its existing investment objective and policy. Conditional on the Proposals completing, JPMF has agreed to reduce the management fees it charges the enlarged JUGI to 0.60 per cent. per annum on net assets up to and including £200 million and 0.55 per cent. per annum on net assets thereafter (currently 0.65 per cent. and 0.55 per cent., respectively). Further, JPMF has committed to make a substantial financial contribution to the Proposals as described in the section titled "JPMF cost contribution".

Katrina Hart, Chair of JUGI, commented: "We are delighted to announce a proposed combination with AUSC following a competitive process. This partnership will create an enlarged company that delivers meaningful benefits for both sets of shareholders, including improved market liquidity and a reduction in our ongoing charges ratio. JUGI makes good use of the investment trust structure through gearing and its enhanced dividend, while the long-term performance record of its experienced management team is compelling. This is JUGI's second consolidation in the last three years and the Board's ambition is that JUGI is recognised as the pre-eminent investment trust investing in UK smaller companies."

Liz Airey, Chair of AUSC commented: "I am delighted that we can offer our shareholders the opportunity to roll over their holdings into an investment trust with exceptional long-term performance within the UK smaller companies sector. Those who elect to do this will also benefit from holding shares in a larger, and so more cost efficient, company which should offer better trading liquidity."

Background to JUGI

JUGI is one of the oldest smaller companies investment trusts in its sector, having launched in 1990. In recent years, the Company has pursued a proactive growth strategy, focused on remaining attractive to a wide investor base, which included the merger with JUGI's sister trust, JPMorgan Mid Cap Investment Trust plc in 2024.

JUGI is managed by Georgina Brittain and Katen Patel, who have been managing the trust for 28 years and 12 years, respectively. JUGI's strategy, which focuses on Value, Quality and Momentum factors, aims for repeatable alpha generation across a variety of market conditions. It has delivered positive long-term NAV total return outperformance of +4.2 per cent. per annum above its composite benchmark¹ over the last ten years. The portfolio managers are members of a dedicated UK Mid and Small Cap specialist investment team benefitting from the broader resources of JPMAM's International Equity Group, a 90+ team of investment professionals globally, with expertise in both quantitative and qualitative analysis.

Although JUGI emphasises total return rather than income growth, the Company offers an attractive dividend policy, targeting a 4 per cent. annual yield based on prior year-end NAV, paid quarterly, drawing from both income and realised capital returns, thereby using a unique feature of the investment trust structure. This enhanced dividend policy represents a significant initial increase in dividend yield for AUSC shareholders without altering the focus on capital growth at a portfolio level.

Summary of the Proposals

Pursuant to the Scheme, eligible AUSC shareholders will be entitled to receive, in respect of some or all of their AUSC shares:

a) New JUGI Shares (the "Rollover Option"); and/or

b) cash (the "Cash Option").

The number of New JUGI Shares to be issued to AUSC shareholders under the Rollover Option will be calculated on a Formula Asset Value ("FAV")-to-FAV basis, based on each company's net asset value calculated in accordance with its normal accounting policies and adjusted to take account of: 1) any unaccrued costs and expenses directly attributable to the implementation of the Proposals and execution of the Scheme ("Proposal Costs"); 2) the Cash Option Discount (defined below); and 3) the Management Fee waiver as described in the section titled "JPMF cost contribution".

Entitlements under the Cash Option will be calculated on the basis of the "Cash FAV", which will be calculated as the Residual NAV multiplied by the percentage of AUSC shares that elect for the Cash Option, less a discount of 2 per cent. of such amount (the "Cash Option Discount"), where the "Residual NAV" is the NAV of AUSC (as determined in accordance with AUSC's normal accounting policies less any Proposal Costs not already accrued by AUSC) as at the Scheme calculation date (the "Calculation Date"), less the value of the cash, assets and undertaking appropriated to a liquidation pool, together with the proposed liquidator's retention.

AUSC shareholders who are eligible to receive New JUGI Shares and who, in respect of all or part of their holding of AUSC shares, do not make a valid election for the Cash Option will be deemed to have elected for the Rollover Option in respect of such holding.

Benefits of the Proposals

The benefits of the Proposals are expected to include:

· Scale, market liquidity and marketability: Post-transaction, the enlarged JUGI will be one of the largest investment trusts in the AIC UK Smaller Companies sector. The enlarged JUGI will offer greater secondary market liquidity, additional cost efficiencies and, by virtue of its size, greater attention from wealth managers and stronger appeal to retail investors.

· Value for money and lower ongoing charges: Conditional on the Proposals becoming effective, JUGI will benefit from a reduced management fee structure of 0.60 per cent., chargeable on net assets up to £200 million, and 0.55 per cent. chargeable on net assets in excess of £200 million. JUGI already has a competitive ongoing charges ratio of 73 bps. Following completion of the Proposals, it is estimated that the ongoing charges ratio of enlarged JUGI will be 70 bps, representing an 11 bps and 3 bps reduction as compared with AUSC's and JUGI's current ongoing charges ratios².

· JPMF's commitment and financial contribution: JPMF, the investment manager of JUGI and a market leader in UK investment trusts with AUM of £16.0 billion, will make a substantial financial contribution to the Proposals, a proportion of which is expected to benefit eligible AUSC shareholders who elect for the Rollover Option. In addition, JPMF is making a separate contribution, post-transaction, to the enlarged JUGI's marketing and promotional activities, which will benefit all shareholders of the enlarged JUGI.

· NAV preservation for enlarged JUGI shareholders: Existing JUGI shareholders and AUSC shareholders rolling over their investment into New JUGI Shares are expected to be insulated from the Proposal Costs incurred by each entity in connection with the Proposals.

· Continued investment exposure to UK Smaller Companies through the investment trust structure: JUGI seeks to provide capital appreciation through investment in a diversified portfolio of UK listed smaller companies, emphasising capital growth, thus providing AUSC shareholders with the opportunity to remain invested in an investment trust that has a mandate that is similar to AUSC's.

· Strong performance: JUGI has a strong NAV total return performance, having delivered 13.5 per cent., 46.2 per cent., -1.5 per cent. and 155.2 per cent. versus its composite benchmark return of 15.3 per cent., 36.2 per cent., 2.0 per cent. and 69.6 per cent. over 1, 3, 5 and 10 years respectively to 31 August 2026, and has a track record of alpha generation across a variety of market conditions.

· Attractive dividend policy: JUGI has an enhanced dividend policy of paying an annual dividend based on 4 per cent. of NAV (calculated as at the end of the preceding financial year), paid quarterly, drawing from both income and realised capital returns. This approach delivers an attractive and regular income for investors, without impacting the way JUGI's portfolio managers manage JUGI's investments.

· Complementary shareholder base: There is considerable overlap between JUGI's and AUSC's top shareholders, potentially offering eligible AUSC shareholders the opportunity to consolidate their investments into a larger, more liquid trust.

· Ability to stay invested in a tax efficient manner: Eligible AUSC shareholders who elect or are deemed to elect for the Rollover Option are expected to be able to do so without triggering a charge to UK capital gains tax.

· Substantial cash exit available: AUSC shareholders will have the option to realise some or all of their holding in AUSC for cash, at AUSC's Residual NAV less a 2 per cent. discount, subject to an aggregate cap of 35 per cent. of AUSC's issued share capital.

JPMF cost contribution

JPMF has agreed to contribute the following amounts, calculated by reference to the management fees at the prevailing marginal management fee rate on the value of the assets rolling into JUGI, comprising:

a) An amount equivalent to 12 months of such management fees to be applied, as required and as set out below, in the calculation of the two companies' FAVs for the purposes of determining entitlements under the Rollover Option (the "Management Fee Waiver"); and

b) a one-off contribution post-transaction to the enlarged JUGI marketing and promotional expenses equal in value to three months' management fees on the value of assets rolling over, which would benefit all shareholders of the enlarged JUGI.

Allocation of the Cash Option Discount and the Management Fee Waiver

The Cash Option Discount and the Management Fee Waiver are to be used in the FAV calculations to defray some or all of the Proposal Costs for all continuing shareholders in enlarged JUGI. If the Cash Option were taken up in full, it is anticipated that the Cash Option Discount and the Management Fee Waiver would be sufficient to offset fully the Proposal Costs for all continuing shareholders in the enlarged JUGI.

It is intended that the Cash Option Discount would first be applied to offset the Proposal Costs incurred by the AUSC shareholders who have elected, or been deemed to have elected, for the Rollover Option. It is intended that the Management Fee Waiver would first be applied to offset the Proposal Costs incurred by JUGI. To the extent that there remain any balances of the Cash Option Discount and the Management Fee Waiver after being so allocated, such balances would be used to offset any remaining Proposal Costs of the other party. Any amount of the Cash Exit Discount and the Management Fee Waiver in excess of that which is needed to meet the Proposal Costs of JUGI and of AUSC shareholders who have elected, or been deemed to have elected, for the Rollover Option, would be retained for the benefit of all shareholders in the enlarged JUGI.

Dividends

It is intended that JUGI's dividend policy will remain unchanged following the implementation of the Proposals being, in the absence of unforeseen circumstances, an annual dividend equivalent to 4 per cent. of its NAV on the last business day of the preceding financial year, paid quarterly, irrespective of the level of income generated by the portfolio during the prevailing financial year.

Board

Following completion of the Proposals, it is expected that Manju Malhotra and Steve Russell, currently directors of AUSC, will join the board of JUGI.

Conditions and expected timetable

Implementation of the Proposals is subject to a number of conditions, including:

· necessary shareholder approvals from the shareholders of AUSC and JUGI being obtained;

· certain tax clearances being received from HMRC by AUSC;

· the passing of JUGI's continuation vote at its AGM expected to be held on 23 November 2026; and

· admission of the New JUGI Shares to trading on the Main Market of the London Stock Exchange.

JUGI will publish a circular to convene a general meeting of JUGI shareholders to approve the issue of New JUGI Shares pursuant to the Proposals. At the same time, AUSC will publish a circular setting out full details of the Proposals and convening the necessary general meetings to implement the Scheme. It is anticipated that such shareholder documentation will be published in late October/early November 2026.

Subject to the relevant conditions being satisfied, it is expected that the Scheme will be completed by the end of 2026.

The expected timetable in respect of the Scheme remains subject to change.

All references to shares in issue or issued share capital exclude treasury shares.

City Code

In accordance with customary practice for such schemes of reconstruction pursuant to section 110 of the Insolvency Act 1986 involving investment companies, the City Code on Takeovers and Mergers is not expected to apply to the combination.

Performance figures used in this announcement are sourced from Morningstar.

Note 1: The benchmark for the JUGI strategy is the Numis Smaller Companies plus AIM (excluding Investment Companies) Index. Prior to 1st January 2019, JUGI's benchmark was the FTSE Small Cap Index (excluding Investment Trusts). The benchmark index returns quoted above for 10 year cumulative return is a composite of the two indices.

Note 2: Historic ongoing charge ratios ("OCRs"), and reductions thereto, are with reference to the OCRs of AUSC and JUGI presented in their half year reports for the periods to 31 December 2025 and 31 January 2026, respectively.

For further information please contact:

JPMorgan UK Small Cap Growth & Income plc Katrina Hart	Contact via Company Secretary
JPMorgan Funds Limited (Manager) Simon Elliott Katie Standley William Talkington	+44 (0) 20 7742 4000
JPMorgan Funds Limited (Company Secretary)	+44 (0) 20 7742 4000
Graham Fenwick Divya Amin

Panmure Liberum Limited (Financial Adviser and Broker) Alex Collins Ashwin Kohli	+44 (0)20 3100 2000

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