TIDMAPH
RNS Number : 0226H
Alliance Pharma PLC
26 November 2015
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, NEW
ZEALAND, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE
SAME WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES IN THE UNITED
STATES, AUSTRALIA, CANADA, NEW ZEALAND, JAPAN, SOUTH AFRICA OR ANY
OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS NOT A PROSPECTUS OR ADMISSION DOCUMENT.
COPIES OF THE ADMISSION DOCUMENT PUBLISHED WILL BE AVAILABLE FROM
ALLIANCE'S REGISTERED OFFICE AND WEBSITE: WWW.
ALLIANCEPHARMACEUTICALS.COM
ALLIANCE PHARMA PLC
Proposed Acquisition of the Healthcare Products Business from
Sinclair IS Pharma plc
The Board of Alliance Pharma plc ("Alliance" or the "Company"),
the specialty pharmaceutical company, today announces that it has
entered into a conditional agreement with Sinclair IS Pharma plc
("Sinclair") to acquire certain assets and businesses principally
focused on dermatology (the "Healthcare Products Business") for a
consideration of GBP127.5 million, plus an estimated GBP4.7 million
for inventory, to be satisfied partly in cash, funded by way of the
New Loans, and partly by the issue and allotment of the Vendor
Consideration Shares pursuant to the terms of the Acquisition
Agreement.
The Acquisition constitutes a reverse takeover under the AIM
Rules and, therefore, Completion is conditional on, amongst other
things, receiving the approval of Shareholders. This approval will
be sought at the General Meeting to be held at the offices of
Fasken Martineau LLP, 17 Hanover Square, London W1S 1HU at 10.00
a.m. on 14 December 2015. Completion and Re-admission are expected
to take place on 17 December 2015.
A combined Admission Document and Circular is being sent to the
Company's shareholders today and will be available on the Investor
Relations section of the Company's website at
www.alliancepharmaceuticals.com.
Transaction highlights:
-- Alliance to acquire 27 products including five key growth
brands (Kelo-Cote(TM) , Flammacerium(TM) , Aloclair(TM) ,
Kelo-stretch(TM) and Atopiclair(TM) ). The acquisition of these
complementary assets will materially increase the scale of the
business.
-- The Acquisition will significantly increase the Company's
footprint outside of the UK and will provide an enhanced platform
for further corporate development.
-- In the 12 months ended 30 June 2015, the Healthcare Products
Business generated revenues of GBP43.3 million and EBITDA before
exceptional items of GBP9.0 million. It is estimated that
cost-saving synergies of approximately GBP5.0 million will be
achievable from the 12 months ending 31 December 2016.
-- The Directors believe that, taking into account the business
and prospects of the Enlarged Group, the Acquisition will be
significantly accretive to earnings per share on an adjusted basis
for the 12 months ending 31 December 2016.
-- The Directors further believe that the return on invested
capital associated with the Acquisition will exceed the Group's
weighted average cost of capital in the 12 months ending 31
December 2017 (assuming a weighted average cost of capital of eight
per cent.).
-- The Acquisition and associated expenses will be financed by a
fully underwritten vendor placing raising gross proceeds of GBP78.5
million and by GBP54.2 million to be drawn down under the New
Loans.
-- The proposed vendor placing will comprise the issue of
191,463,414 new Ordinary Shares at a price of 41 pence per share, a
discount of approximately 19.6 per cent. to the closing mid-market
price of 51 pence per ordinary share on 25 November 2015.
-- Irrevocable undertakings to vote in favour of the Resolutions
have been received from the Directors and certain Shareholders in
respect of 123,484,458 Ordinary Shares, in aggregate, representing
approximately 46.7 per cent. of the Existing Issued Share
Capital.
-- The Company has also granted the Option to Numis under the
Placing Agreement in order to enable Numis to deal with additional
demand under the Placing in the event that requests to participate
in the Placing from institutional and certain other investors are
received during the period from the date of this announcement to
5.00 p.m. on 2 December 2015. Any Ordinary Shares issued pursuant
to the exercise of the option will be issued on the same terms and
conditions as the Vendor Consideration Shares. The maximum number
of new Ordinary Shares that may be issued pursuant to the exercise
of options is 12,195,121.
John Dawson, Chief Executive of Alliance, commented:
"This Acquisition represents a very significant development for
Alliance. On completion, Alliance will be a significantly larger
business with synergies in existing markets. Having over half of
our business outside of the UK, we will have a greater ability to
compete for international deals and in-licensing
opportunities."
Conference call for analysts
A conference call for analysts will be held this morning at
7.45am GMT. For further details of the conference call, please
contact Buchanan on 020 7466 5000.
Expected timetable of principal events
Announcement of the Placing and Acquisition 26 November 2015
Publication date of the Admission Document 26 November 2015
Latest time and date for receipt of Forms 10.00 a.m. on 12 December
of Proxy in respect of the General Meeting 2015
General Meeting 10.00 a.m. on 14 December
2015
Expected date and time of suspension 4.30 p.m. on 16 December
of trading of the Ordinary Shares on 2015
AIM
Expected date of completion of the Acquisition 8.00 a.m. on 17 December
2015
Expected date and time of Re-admission 8.00 a.m. on 17 December
becoming effective and dealings in the 2015
Ordinary Shares commencing on AIM
Re-admission and Placing statistics
Existing Issued Share Capital 264,520,610
Ordinary Shares
Number of Vendor Consideration Shares proposed
to be issued 191,463,414
Maximum number of Option Shares to be issued pursuant
to the Option 12,195,121
Placing Price 41 pence per
Ordinary Share
Enlarged Issued Share Capital (assuming no Option 455,984,024
Shares are issued) Ordinary Shares
Enlarged Issued Share Capital (assuming the maximum 468,179,145
number of Option Shares are issued) Ordinary Shares
Gross value of the Vendor Consideration Shares GBP78.5 million
at the Placing Price
Gross value of the Option Shares at the Placing GBP5.0 million
Price (assuming the maximum number of Option Shares
are issued)
Market capitalisation of the Enlarged Group at GBP187.0 million
the Placing Price immediately following Re-admission
(assuming no Option Shares are issued)
Market capitalisation of the Enlarged Group at GBP192.0 million
the Placing Price immediately following Re-admission
(assuming the maximum number of Option Shares
are issued)
Further information:
Alliance Pharma plc
+ 44 (0) 1249
John Dawson, Chief Executive 466966
Numis Securities Limited
Nominated Adviser: Michael Meade / Freddie + 44 (0) 20 7260
Barnfield 1000
Corporate Broking: David Poutney
/ James Black
Buchanan
Mark Court / Sophie Cowles / Jane + 44 (0) 20 7466
Glover 5000
Proposed acquisition of the Healthcare Products Business from
Sinclair IS Pharma plc, proposed Vendor Placing of 191,463,414 new
Vendor Consideration Shares at 41 pence per share, proposed placing
of up to 12,195,121 Option Shares at 41 pence per share,
re-admission of the Ordinary Shares to trading on AIM and Notice of
General Meeting
1. Introduction
Alliance today announces that it, together with its wholly owned
subsidiary APL, has entered into the conditional Acquisition
Agreement with Sinclair to acquire the Healthcare Products
Business. The aggregate consideration for the Acquisition,
determined on an adjusted debt free/cash free basis, is up to
GBP127.5 million, plus an estimated GBP4.7 million for inventory,
to be satisfied partly in cash, funded by way of the New Loans, and
partly by the issue and allotment of the Vendor Consideration
Shares pursuant to the terms of the Acquisition Agreement. The
Vendor Consideration Shares are proposed to be placed by Numis on
behalf of the Company pursuant to the Placing Agreement to raise
approximately GBP78.5 million (before expenses).
Irrevocable undertakings to vote in favour of the Resolutions
have been received from the Directors and certain Shareholders in
respect of 123,484,458 Ordinary Shares, in aggregate, representing
approximately 46.7 per cent. of the Existing Issued Share
Capital.
2. Background to and reasons for the Acquisition and Placing
Overview
The Directors believe that the Healthcare Products Business will
complement the Group's business and strategy. The principal therapy
area of the Healthcare Products Business is dermatology and the
Acquisition will therefore give the Enlarged Group, from
Re--admission, a broad geographic reach by combining the Healthcare
Products Business with the Group's existing core portfolio in
dermatology, which Alliance has successfully served for over a
decade and which remains an important area of continuing medical
need.
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The portfolio of Healthcare Products contains a mixture of
'growth' products receiving promotion as well as non--promoted,
established products. This corresponds with the Group's strategic
approach to balancing risk within its portfolio and also applies to
the similar prescription and consumer split of each of the
portfolios. The Healthcare Products Business is similar in size to
the Group in terms of revenue and the Acquisition is therefore
expected to provide a significant increase in the scale of
business, leading to economies of scale and increased revenue and
EBITDA, improved access to further acquisitions and a higher
industry profile. The Healthcare Products Business and the Group
have each been pursuing an internationalisation strategy. The
Directors expect that the Enlarged Group will be able to take
advantage and benefit from this synergy by (i) strengthening the
existing footprint of the top five directly served territories in
Europe (and in particular the UK, France and Italy) and (ii)
providing an extensive combined network of distributors serving the
APAC, MEA and LATAM/US regions. The Healthcare Products Business
achieved revenue of GBP43.3 million for the 12 months ended 30 June
2015, with a gross profit of GBP22.2 million and EBITDA before
exceptional items of GBP9.0 million over the same period.
The Directors therefore believe that the resulting business of
the Enlarged Group will have a stronger platform for future
development with synergies in existing markets and, with over half
of its business outside of the UK, create greater opportunity for
international deals including in--licensing opportunities, and
candidacy as a truly global Alliance partner.
International diversification and distribution network
The Enlarged Group will have a significantly larger
international footprint than the existing Group with around half of
the Enlarged Group's sales having been made internationally over
the 12 month period ended 30 June 2015 on a pro-forma basis. The
Healthcare Products Business currently serves the top five European
markets with offices in France, Italy and the UK. For the 12 months
ended 30 June 2015, the Healthcare Products Business achieved sales
of GBP24.4 million in its key Western European markets. The top
five territories of the Healthcare Products Business for the same
period were France (sales of GBP8.9 million), UK (GBP6.3 million),
Italy (GBP4.3 million), Germany (GBP2.6 million) and Spain (GBP2.4
million). The other top 10 territories included Algeria, China,
Brazil, the Philippines and Indonesia which were served by a
network of distribution partners. The Healthcare Products Business'
top 10 territories accounted for just over two-thirds (68 per
cent.) of gross revenues for the 12 months ended 30 June 2015. The
Healthcare Products Business also has a small presence in the US
and Brazil through distribution partners, which the Directors
believe has the potential for growth. The Directors believe that
the diverse geographical spread of the Healthcare Products Business
helps to reduce risk and creates a better platform for acquisition
and in--licencing opportunities.
Currently, distribution of the Healthcare Products is carried
out either directly (39.9 per cent. of revenues in the 12 months
ended 30 June 2015), which results in higher gross margins for the
Healthcare Products Business, or via third party distributors (60.1
per cent. of revenues in the 12 months ended 30 June 2015). The mix
of direct and non--direct sales may change over time, as the extent
of the Enlarged Group's presence in each territory alters. The
distributor base comprises at least 65 active distributors, with
the top five (Menarini, Bard, Conbio, Recordati and Magpharm)
accounting for over 50 per cent. of the total distributor revenue
in the 12 months ended 30 June 2015. The Directors believe that
there may be potential for the distribution network to provide a
platform for Hydromol and other existing products of the Group to
be introduced to new territories.
The Enlarged Group will then expect to be able to, in due
course, introduce products from the Group's existing portfolio to
these markets via the distribution network it is acquiring pursuant
to the Acquisition as well as any new lines of distribution it is
able to establish.
Complementary product portfolio of growth and established
products
The Healthcare Product portfolio consists of a range of devices,
cosmetics and medicines focused on dermatology and wound care. The
Healthcare Products Business is therefore similar to the Group's
existing range of products, which is also comprised of a mixture of
devices, cosmetics and medicines.
The majority of the Healthcare Products are not prescription
products, which provides the Enlarged Group's portfolio with a more
balanced prescription/OTC mix.
The portfolio of Healthcare Products contains a mixture of
'growth' products receiving promotion as well as non--promoted,
established products. The Directors have identified 20 such
established products among the Healthcare Products.
The Directors have also identified five key growth brands:
Kelo-cote(TM) (a wound care product with sales of GBP8.0 million
for the 12 months ended 30 June 2015); Flamma Franchise including
Flammacerium(TM) which was granted orphan drug designation in the
USA by the FDA in 2014 (wound care; sales of GBP7.1 million);
Aloclair(TM) (wound care; sales of GBP4.0 million);
Kelo-Stretch(TM) (skin care; sales of GBP2.7 million) and
Atopiclair(TM) (skin care; sales of GBP2.0 million).
Taking these products with the Group's current portfolio, the
Directors believe that the portfolio of the Enlarged Group will
consist of a well--balanced blend of stable, established products
and 'growth' brands, with an improved balance between prescription
products and products with OTC status.
Acceleration of the Group's stated 'Buy & Build' strategy to
create an Enlarged Group of scale
The Directors believe that the Acquisition will prove
transformational in terms of scale, product range and geographical
reach resulting in greater efficiency and increased revenue for the
Enlarged Group, as well as improved access to further acquisitions
and an enhanced industry profile. For the 12 months ended 30 June
2015, the Enlarged Group achieved pro--forma sales of GBP88.1
million and gross profit of GBP49.2 million.
The Group has experience of integrating acquisitions through its
'Buy & Build' model having completed at least 18 acquisitions
(both corporate entities and assets) since it was admitted to AIM
in 2003. Notwithstanding this experience, the Directors recognise
that the Acquisition is larger than any of the Group's previous
acquisitions and plans have been put in place to integrate and
deliver the transition programme by the Group's management
team.
3. Information on the Group
The Group is a specialty pharmaceuticals group traded on AIM
(LSE: APH). Audited turnover for the 12 months ended 31 December
2014 was GBP43.5 million and pre--tax profits were GBP10.8 million
before exceptional items. The Group is headquartered in the UK and
employed 88 people (in the UK, Republic of Ireland, France, Germany
and China) as at 1 November 2015. In the six months ended 30 June
2015, unaudited turnover was GBP22.8 million and unaudited pre--tax
profits were GBP5.5 million.
The Group's principal activity is the marketing of
pharmaceutical and healthcare products. Its brands are sourced via
acquisition or inward licensing. The brands and products are
selected for their sales stability or growth potential. Capital
intensive activities such as manufacturing, warehousing and
logistics are controlled by the Group but outsourced to specialist
service organisations in these fields. The Group does not engage in
R&D, except for minor line extensions on a product by product
basis. The Group's personnel have been recruited from a wide range
of pharmaceutical companies and backgrounds.
4. Information on the Vendor
Sinclair is a medical and aesthetic dermatology international
specialty pharmaceuticals company traded on AIM (LSE: SPH).
Sinclair has its corporate headquarters in London, UK and has a
sales and marketing footprint in the UK, France, Germany, Italy and
Spain, and a presence in emerging markets around the world through
strategic partners.
In November 2014, Sinclair commenced a strategic review and
consequently decided to divest its non--aesthetics business and
focus on its aesthetics activities.
5. Information on the Healthcare Products Business
The Acquisition is being effected as follows: (a) the purchase
of the collection of companies forming the SPH Group, and (b) the
acquisition of the Healthcare Products not owned by those companies
and their related businesses.
SPH Group
The SPH Group is a collection of four companies: Advanced
Biotechnologies Inc. (incorporated in Florida, USA), Sinclair
Pharma s.r.l. (incorporated in Italy), Sinclair Pharma France SAS
(incorporated in France) and Maelor Laboratories Limited
(incorporated in England and Wales).
Healthcare Products Business not owned by the SPH Group
Not all of the Healthcare Products Business is owned by
companies in the SPH Group. The remainder of the Healthcare
Products Business is owned by other companies in the Sinclair
Group, and is being acquired by APL. These business assets include
a single Healthcare Product and the distributor relationships
relevant to the Healthcare Products which are not otherwise being
acquired with the SPH Group.
Historical financial information
The Healthcare Products Business Combined HFI has been prepared
in respect of the Healthcare Products Business.
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The Healthcare Products Business Combined HFI was prepared using
the Healthcare Products Business' historical records of its assets
and liabilities, and includes all sales, costs, assets and
liabilities directly attributable to the Healthcare Products
Business. Costs directly associated with the Healthcare Products
Business, for example, costs associated with manufacturing, are
separately identifiable and have been included directly within the
Healthcare Products Business Combined HFI.
In addition, there are a number of other indirect central costs
which have been allocated into the Healthcare Products Business
Combined HFI to reflect the fact that the Healthcare Products
Business operated as part of the wider Sinclair Group. These costs
primarily relate to the sales force, general marketing and
merchandising, and general corporate expenses related to
regulatory, development, finance, legal and information technology.
These expenses have been allocated to the Healthcare Products
Business on the basis of direct usages when identifiable, or on a
basis deemed appropriate by the management of the Healthcare
Products Business, for example, scheme members' time spent in
relation to share -based payments, headcount and promotional spend,
with the remainder allocated on the basis of the Healthcare
Products Business' revenue as a proportion of the Sinclair Group's
total revenue. These costs were affected by the arrangements that
existed in the Sinclair Group and are not necessarily
representative of the position that will prevail in the future. As
such, the Directors do not consider that the historical cost base
reflects the cost base that would be attributed to the Healthcare
Product Business once integrated within the Enlarged Group.
Historical Income Statement
GBP'm 12 months 12 months 12 months
ended 30 ended ended 30
June 2015 30 June June 2013
2014
----------- ---------- -----------
Revenue 43.3 46.1 46.5
Cost of sales (21.1) (23.3) (20.1)
----------- ---------- -----------
Gross profit 22.2 22.8 26.4
Administration and marketing
expenses (17.2) (18.4) (36.1)
----------- ---------- -----------
Operating profit/(loss) 5.0 4.4 (9.7)
Finance expense[1] - - -
----------- ---------- -----------
Profit/(loss) before taxation 5.0 4.4 (9.7)
Taxation 0.4 0.4 1.3
----------- ---------- -----------
Profit/(loss) for the year 5.4 4.8 (8.4)
=========== ========== ===========
Reconciliation to EBITDA before exceptional items:
GBP'm 12 months 12 months 12 months
ended 30 ended ended 30
June 2015 30 June June 2013
2014
Operating profit/(loss) 5.0 4.4 (9.7)
Depreciation & amortisation 3.8 3.6 3.8
Exceptional items 0.2 - 12.2
----------- ---------- -----------
EBITDA before exceptional items 9.0 8.0 6.3
=========== ========== ===========
It is important to note that approximately 55-60 per cent. of
sales are booked by the Vendor in Euros. The Healthcare Products
Business' sales have been stable on a constant currency basis with
sales of GBP43.5 million for the 12 months ended 30 June 2013 and
GBP44.0 million for the 12 months ended 30 June 2014 based on the
actual exchange rate for the 12 months ended 30 June 2015. The
Directors understand that comparisons between sales in the years
ended 30 June 2014 and 2015 are also distorted by distributors
building inventory for launch campaigns between April 2014 and
December 2014. The Directors also understand that sales were
impacted by margin sharing arrangements. As noted above, the
Directors do not believe that the historical costs attributed to
the Healthcare Products Business are reflective of likely future
costs within the Enlarged Group. EBITDA and EBITDA margins have
both increased over the period reviewed in the Healthcare Products
Business Combined HFI.
The Healthcare Products Business
The Group will acquire a portfolio of 27 products. Five of these
products have been identified by the Directors as 'growth' products
with the remainder of the portfolio considered stable established
products, some of which the Directors believe have the potential
for line extension. Within the 'growth' product category
Kelo-cote(TM), the Flamma Franchise and Aloclair(TM) are wound care
products whereas Kelo--stretch(TM) and Atopiclair(TM) are skin care
products. Further details of the key products are set out
below.
The Directors believe that Kelo--cote(TM), which is used for the
treatment of hypertrophic scars, has good prospects for growth in
Asia and in Brazil where a new sun protection factor formulation,
Kelo-cote UV, was launched in 2015. Alliance intends to pursue a
strategy for continued growth through distributor promotions and
development and in--licensing of new line extensions such as
silicone sheets. Kelo--cote(TM) dries to an invisible, breathable
sheet in four to five minutes, which the Directors believe is
quicker than competing products; it is the only Healthcare Product
with clinical trial data. Sales of Kel-o-cote(TM) increased by 18.9
per cent. between June 2012 and September 2015 on a last 12 month
basis. Last 12 month sales from the product remained steady between
June 2012 and November 2014, since when they have increased to
GBP8.8 million (for the 12 months ended to 30 September 2015).
Kelo--cote(TM) has performed strongly in China with sales
increasing from approximately GBP0.7 million on a last 12 month
basis for the period to 30 June 2012 to GBP2.3 million for the
period ended 30 September 2015, with sales growth having
accelerated in recent months.
The Flamma Franchise is used for the treatment of burns and
wounds in hospitals. Its key features are that it is a sterile
cream, which prevents infection, relieves pain and speeds up the
healing process. The Directors believe that there is a specific
opportunity to launch Flammacerium(TM) in the UK in Q1 2017 once
regulatory approval has been obtained. Flammacerium(TM) has been
granted orphan drug ("OD") designation in the US by the FDA.
Alliance intends to pursue growth through new negotiations and a
new OD indication launch in the US.
Aloclair(TM) is used for the treatment of aphthous mouth ulcers
and other minor oral lesions and its sales are growing in the UK,
US and Portugal as well as in other regions. It is positioned as a
fast acting pain- relieving treatment, which is non-stinging,
alcohol free and promotes healing; it is supplied with applicators
and there are no age limits on its use. Alliance intends to pursue
growth by consolidating the brand into its Consumer Healthcare
division and completing the development and launch of Aloclair
Ultra, a new long--acting formulation.
Kelo--stretch(TM) is a clinically proven dermocosmetic cream for
the prevention and treatment of stretch marks. It moisturises and
heals, is sensitiser -and irritant- free, is quickly absorbed and
is non--sticky. Its growth is being driven in Asia through the
distribution agreement with Menarini. Alliance will seek to pursue
growth through new and existing distribution channels with central
brand marketing support.
Atopiclair(TM) is a steroid free reference treatment for mild to
moderate atopic dermatitis, for use in hospitals, primary care and
OTC. It restores, protects and calms the affected area. The product
is showing sales growth via its distribution partner, Menarini, in
APAC. Alliance will pursue the product's growth as an "anti-itch"
gap within its existing Hydromol portfolio, as well as supporting
growth in APAC via Menarini and through a focus on developing the
product's European sales.
The turnover of the Healthcare Products is set out below:
Sales in
the 12 months Percentage
ended 30 of sales
June 2015 in the 12
(in GBP months ended
Brand Application millions) 30 June 2015
Kelo-cote(TM) Hypertrophic scars 8.0 18.4%
Flamma Franchise Wound care 7.1 16.4%
Bleeding oesophageal
Haemopressin(TM) varices 4.0 9.2%
Aloclair(TM) Mouth ulcers 4.0 9.2%
Optiflo(TM) Catheter flushing 2.8 6.5%
Kelo-stretch(TM) Stretch marks 2.7 6.2%
Oxyplastine(TM) Humid eczema 2.4 5.5%
Atopiclair(TM) Atopic dermatitis 2.0 4.6%
Papulex(TM) Acne 1.8 4.2%
Fazol(TM) Dermal fungal infections 1.7 3.9%
Tridesonit(TM) Contact/Atopic dermatitis 1.4 3.2%
(MORE TO FOLLOW) Dow Jones Newswires
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Others Various 5.4 12.7%
Totals 43.3 100.0%
=============== ==============
Included in the assets to be acquired pursuant to the
Acquisition are 27 families of patents and patent applications that
are in force or under ongoing examination respectively and which
cover each of Aloclair(TM), Atopiclair(TM), Decapinol(TM),
Effadiane(TM), Kelo-cote(TM), Optiflo(TM), Papulex(TM) and
Sebclair(TM). These patents and applications vary in the
jurisdictions they cover but most include at least the main
European countries (France, Germany and the UK) as well as the US,
parts of MEA, LATAM and CEE. The patent families themselves have
varying levels of longevity with the earliest date of expiry being
November 2016 (relating to Effadiane) and the latest currently
being February 2033 (relating to Kelo-cote(TM)). Whilst the
acquisition of a portfolio of products which has such a level of
patent protection is a significant departure, in terms of size, by
the Group from previous acquisitions, the Directors believe that
the value of the Healthcare Products Business does not rest simply
with the higher level of patent protection but, in line with the
Group's strategy, to a greater degree with the brand recognition
and repeat use by patients and healthcare practitioners.
Manufacturing
All of the products being acquired are manufactured in the US or
EU, with three also being manufactured in India. The Healthcare
Products Business does not manufacture any of its own products. As
part of the Acquisition, the Group will also take on contract
manufacturing agreements pursuant to which all of the Healthcare
Products being acquired are manufactured.
Distribution
The products being acquired are currently distributed both
directly (39.9 per cent. of gross revenues in the 12 months ended
30 June 2015) and through the Healthcare Products Business's
distribution network (60.1 per cent. of revenues in the 12 months
ended 30 June 2015). The mix of direct and indirect sales depends
on whether the Healthcare Products Business has a physical presence
in a given territory. Direct sales are higher in Europe. The
Healthcare Products Business has a small presence in the US through
distributors, with potential for future growth.
The Group will take on agreements with at least 65 active
distributers, which relate to all of the products being acquired
and their distribution around the world. The Group intends to
continue with and, where applicable, to renew the distribution
relationships. Historically these relationships have been
maintained by the relevant Regional Directors and following
Completion the Enlarged Group intends to maintain those
relationships.
The top five distributors in revenue terms are Menarini (Asia),
Bard (UK - Optiflo(TM)), Conbio (China - Kelo--cote(TM)), Recordati
and Magpham Sarl (MEA - Oxyplastine(TM)).
Inventory holding arrangements
The Healthcare Products Business does not hold inventory
directly and inventory is held and managed by external distributors
and warehouse providers including Silvano Chiapparoli Logistica,
Next Pharma, Farmavenix and Mawdsley Brooks & Co. The Group
intends to continue the SPH Group's stockholding arrangements
following Completion.
Healthcare Products Business personnel to be transferred to the
Group pursuant to the Acquisition
It is expected that 39 Healthcare Product Business employees
will transfer on Completion and be employed by the Enlarged Group.
It is likely that further employees will need to be recruited to
operate the activities of the Healthcare Products Business
following Completion. The statutory consultation processes required
in particular by French law have been concluded.
SPH Group key sites
The Healthcare Products Business maintains offices in London
(UK), Chester (UK), Paris (France) and Milan (Italy). The Paris
office serves as the SPH Group's global operational
headquarters.
Transitional Arrangements
The Acquisition Agreement provides that, for a period of 12
months after Completion, Sinclair will provide certain transitional
services to Alliance in order to facilitate the integration of the
Healthcare Products Business. Those services will focus on the
transition of key business functions including regulatory;
commercial support; finance, accounting & supply chain and
operations. The Acquisition Agreement also provides for the
handover of IT systems and communication with key external
stakeholders including distributors. In addition, the Group has
developed a detailed transition plan building on its extensive
experience of integrating acquisitions through its 'Buy &
Build' model. A transition director has been appointed and a team
prioritising the integration established.
6. Information on Current Product Portfolio of the Group
The Group's sales are derived from sale of prescription products
and OTC products, with sales of prescription products being the
predominant channel. The Group distributes to hospitals directly,
to pharmaceuticals wholesalers which service both retail and
hospital pharmacies and to distributors in various territories
around the world. Currently the Group does not have any
direct--to-consumer or online sales.
The turnover of the leading products in the Group's current
portfolio is set out below:
Percentage
Sales in the 12 of sales in
months ended 31 the 12 months
December 2014 ended 31 December
Brand Application (in GBP millions) 2014
Hydromol(TM) Dermatology 6.0 13.8%
Opus(TM) Stoma Care 4.3 9.9%
Buccastem(TM) Nausea & Vomiting 2.5 5.7%
Nu-Seals(TM) Cardiology 2.3 5.3%
Syntometrine(TM) Obstetrics 2.1 4.8%
Forceval(TM) Nutrition 1.9 4.4%
Timodine(TM) Dermatology 1.7 3.9%
Vitamin E Nutrition 1.6 3.7%
Naseptin(TM) Antibacterial 1.4 3.2%
Ashton & Parsons(TM) Teething 1.4 3.2%
Anti-Malarials Infectious diseases 1.3 3.0%
Others Various 17.0 39.1%
Totals 43.5 100.0%
=================== ===================
7. Strategy of the Group
The Group's strategy is to grow through acquisition and
in--licensing of cash -generating healthcare products, maintain a
balanced portfolio of growth and established products to deliver
profits whilst exploiting growth opportunities, scale up the
business for improved profitability and deal flow, and
internationalise in order to provide a stronger platform for future
development.
8. Details of the Acquisition
Under the terms of the Acquisition Agreement, APL has
conditionally agreed to acquire, and the Vendor has conditionally
agreed to procure the sale by its subsidiaries of, the Healthcare
Products Business, by way of the acquisition of the SPH Group and
the single Healthcare Product which is outside the SPH Group, for
an aggregate consideration of up to GBP127.5 million (plus an
estimated GBP4.7 million for inventory). In addition, the Vendor
will be entitled to receive the Royalty, which is calculated at the
rate of 12.0 per cent. on net US sales of Flammacerium(TM) in the
five years following the Launch Date.
The consideration for the Acquisition, which is payable on
Re--admission, is to be satisfied partly in cash, funded by way of
the New Loans, and partly by the issue and allotment of the Vendor
Consideration Shares (pursuant to the terms of the Acquisition
Agreement). To this end the Company and Numis have entered into the
Placing Agreement to affect the Vendor Placing to raise GBP78.5
million (before expenses). Under the terms of the Placing
Agreement, Numis has agreed to procure that the net proceeds of the
Vendor Placing (after deducting all commissions) are paid to the
Vendor. In addition, the Company is increasing its debt facility to
GBP100.0 million (including the refinancing of GBP25.6 million of
existing debt) by way of the New Loans.
The Acquisition Agreement is conditional, inter alia, upon the
passing of the Resolutions and Re--admission.
The Acquisition Agreement also contains certain warranties from
the Vendor relating to, inter alia, the Healthcare Products and the
SPH Group which are subject to an aggregate financial cap on the
Vendor's liability by reference to a percentage of the value of the
consideration payable by APL for the Acquisition.
9. Details of the Placing
Under the Vendor Placing, the Company will issue and allot
191,463,414 Vendor Consideration Shares to Numis, or such persons
as Numis may procure on behalf of the Company to subscribe for such
shares, at the Placing Price. The aggregate value of the Vendor
Consideration Shares at the Placing Price is GBP78.5 million (of
which GBP2.16 million will be withheld to settle the commissions
payable by the Company pursuant to the Placing Agreement and the
balance paid to the Vendor). The Placing Price represents a
discount of approximately 19.6 per cent. to the closing price of 51
pence per Ordinary Share as at 4.30 p.m. on 25 November 2015 (being
the latest practicable time before publication of this
announcement).
(MORE TO FOLLOW) Dow Jones Newswires
November 26, 2015 02:01 ET (07:01 GMT)
In connection with the Vendor Placing, the Company and Numis
have entered into the Placing Agreement pursuant to which Numis has
agreed, in accordance with its terms, to use reasonable endeavours
to procure subscribers on behalf of the Company for the Vendor
Consideration Shares at the Placing Price. The Vendor Placing has
been underwritten by Numis.
The Placing Agreement contains customary warranties given by the
Company to Numis as to matters relating to the Group and its
business and a customary indemnity given by the Company to Numis in
respect of liabilities arising out of or in connection with the
Placing. Numis is entitled to terminate the Placing Agreement in
certain circumstances prior to Re--admission, including
circumstances where any of the warranties are found not to be true
or accurate or were misleading and which in any such case is
material, or the occurrence of certain force majeure events.
The Placing is conditional, inter alia, on:
-- the relevant conditions in the Placing Agreement being
satisfied or (if applicable) waived and the Placing Agreement not
having been terminated in accordance with its terms prior to
Re-admission;
-- the Acquisition Agreement having become unconditional in all
respects, save for Re-admission;
-- the New Loans Agreement having become unconditional in all
respects, save for R-admission and the Vendor Placing;
-- the passing of the Resolutions; and
-- Re-admission becoming effective by no later than 8.00 a.m. on
17 December 2015 (or such later time and/or as Numis and the
Company may agree, being not later than 8.30 a.m. on 28 December
2015).
The Company has also granted the Option to Numis under the
Placing Agreement in order to enable Numis to deal with additional
demand under the Placing in the event that requests to participate
in the Placing from institutional and certain other investors are
received during the period from the date of the Admission Document
to 5.00 p.m. on 2 December 2015.
The Option is exercisable on more than one occasion at any time
prior to 5.00 p.m. on 2 December 2015. Any Ordinary Shares issued
pursuant to the exercise of the Option will be issued on the same
terms and conditions as the Vendor Consideration Shares. The Option
may be exercised by Numis, following consultation with the Company,
but there is no obligation on Numis to exercise the Option or to
seek to procure subscribers for Ordinary Shares pursuant to the
Option. The maximum number of new Ordinary Shares that may be
issued pursuant to the exercise of the Option is 12,195,121. The
maximum number of Ordinary Shares (including Ordinary Shares issued
pursuant to exercise of the Option) that may be issued pursuant to
the Placing is 203,658,535. The net proceeds received by the
Company pursuant to the exercise of the Option (if any) will be
used for general corporate purposes.
The Vendor Consideration Shares will represent, in aggregate,
approximately 42.0 per cent. of the Enlarged Issued Share Capital
(assuming no Option Shares are issued). The Placing Shares will
represent, in aggregate, approximately 43.5 per cent. of the
Enlarged Issued Share Capital (assuming the maximum number of
Option Shares are issued). The Placing Shares will be issued
credited as fully paid and will, upon issue, rank pari passu in all
respects with the Ordinary Shares then in issue, including all
rights to receive all dividends and other distributions declared,
made or paid following Re--admission. The Placing Shares are not
being made available to the public and are not being offered or
sold in any jurisdiction where it would be unlawful to do so.
10. Details of current funding and New Loans
Alliance has existing banking facilities of GBP55.0 million with
Bank of Scotland plc and National Westminster Bank Plc of which a
GBP19 million term loan and approximately GBP6.8 million revolving
credit facility has been drawn down as at 30 September 2015. Net
bank debt was approximately GBP25.6 million at 30 September
2015.
Alliance has negotiated new enlarged bank facilities of up to
GBP100.0 million on improved terms with Bank of Scotland plc,
National Westminster Bank Plc and Silicon Valley Bank.
The new facilities will immediately replace the existing
facilities and will be available until November 2020. The new
facilities comprise a GBP65.0 million term loan ("Term Loan") and a
GBP35.0 million revolving credit facility ("RCF"). There will also
be an additional GBP5.0 million uncommitted working capital
facility and a GBP25 million uncommitted "accordion" facility. The
Term Loan will be used to refinance the existing banking facilities
and to finance, in part, the Acquisition (including the payment of
certain fees, costs and expenses incurred in connection with the
Acquisition). The RCF will in part be applied towards financing the
Acquisition, and the balance will be available for general
corporate and working capital purposes (including the ability to be
used to fund further acquisitions).
Interest on the Term Loan will be between 1.7 per cent. and 2.75
per cent. above LIBOR depending on the Enlarged Group's gearing
level. The main financial covenants specify maximum leverage (the
ratio of net bank debt to EBITDA) of 3.25 times (reducing over
time), minimum interest cover (the ratio of EBITDA to finance
charges) of 4.0 times and operating cash flows must exceed debt
service cash flows. The Directors expect the leverage on
Re--admission to be in the range of 2.54 to 2.82 times EBITDA.
The Term Loan is to be repaid as to GBP39.5 million in quarterly
instalments commencing 31 March 2016, at the rate of GBP6 million
per annum, rising to GBP10 million per annum from 2019. The balance
of up to GBP25.5 million is to be repaid at the end of the five
year term.
11. Financial effects of the Acquisition and Placing
The Directors believe that, taking into account the business and
prospects of the Enlarged Group, the Acquisition will be
significantly accretive to earnings per share on an adjusted basis
for the 12 months ending 31 December 2016. The Directors believe
that the Acquisition's historic cost base is not reflective of the
cost base that it will incur as part of the Enlarged Group and
believe that cost--saving synergies of approximately GBP5.0 million
will be achievable from the 12 months ending 31 December 2016. The
Directors further believe that the return on invested capital
associated with the Acquisition will exceed the Group's weighted
average cost of capital in the 12 months ending 31 December 2017
(assuming a weighted average cost of capital of eight per cent.).
These statements are not intended to be a profit forecast, have not
been reviewed or reported on, and should not be interpreted to mean
that the earnings per share of Alliance following Completion will
necessarily be above or below the historical published earnings per
share.
An unaudited pro-forma statement of net assets is set out in the
Admission Document and discloses that, on the assumptions stated,
on Completion the Enlarged Group would have pro-forma net assets of
GBP153.9 million after paying the estimated expenses of the
Proposals.
14. Working Capital
In the opinion of the Directors, having made due and careful
enquiry and taking into account the New Loans and existing cash
resources available to the Enlarged Group, the Enlarged Group will
have sufficient working capital available to it for its present
requirements, that is for at least 12 months from Re-admission.
15. Dividend Policy
The Company has historically had a progressive dividend policy
and the Directors intend this to continue to be the case. The
Company's interim and final dividend payments are expected to be
split approximately one-third to two-thirds respectively.
The amount of future dividend payments proposed to Shareholders,
if any, will depend on Alliance's operating profit, future
prospects, financial condition, and capital requirements, any
financing required to grow operations, overall business conditions
and other factors deemed relevant by the Directors.
For the 12 months ended 31 December 2012 and 2013, Alliance paid
a dividend of 0.825 pence per share (GBP2.0 million in total) and
0.908 pence per share (GBP2.4 million in total) respectively. For
the 12 months ended 31 December 2014, Alliance paid an interim
dividend of 0.333 pence per share (GBP0.9 million in total) and a
final dividend of 0.667 pence per share (GBP1.8 million in total).
Alliance has declared an interim dividend for 2015 of 0.366 pence
per share (GBP1.7 million in total, based on the Enlarged Issued
Share Capital) which is due to be paid on 14 January 2016 to
Shareholders on the register as at 18 December 2015. Accordingly it
is anticipated that the Placing Shares will participate in this
interim dividend.
Dividends paid out by Alliance to date are not necessarily an
indication of Alliance's future dividend payments. Payments of
dividends are made in accordance with the Act.
16. Current Trading and Outlook
The Group
For the six months ended 30 June 2015, the Group delivered
unaudited revenues of GBP22.8 million (30 June 2014: GBP21.4
million). This year--on--year increase of 6.5 per cent. was driven
in part by an increase in sales of the Hydromol(TM) Dermatology
range to GBP3.3 million for the period. MacuShield(TM) contributed
GBP1.4 million following its acquisition in February 2015 and
Gelclair also performed strongly, increasing sales by 8 per cent.
on only modest promotional support. Sales in the Group's French and
German businesses was impacted by the weakening Euro with sales in
both countries being approximately flat over the period following
translation into Pounds Sterling.
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November 26, 2015 02:01 ET (07:01 GMT)
Gross profit for the same period increased by 15.7 per cent. to
GBP13.8 million. For the 12 months ended 31 December 2014, the
Group was in the process of handing back a number of fostered
products to Novartis and as such generated lower margins on these
products. For the six months ended 30 June 2015, these products
were fully handed back which helped increase gross margin to 61 per
cent. (30 June 2014: 56 per cent.). Operating profit grew by 2.2
per cent. to GBP6.1 million (30 June 2014: GBP6.0 million) and
pre--tax profits grew by 1.4 per cent. to GBP5.5 million (30 June
2014: GBP5.4 million) over the period.
Cash inflows from operating activities were GBP2.8 million over
the first half of the year, after significant increases in
inventory to reduce the risks of inventory shortfall. Net debt
increased to GBP26.5 million at 30 June 2015 (GBP21.1 million at 31
December 2014) primarily due to the GBP5.5 million drawdown on the
Group's revolving credit facility to fund the MacuShield(TM)
acquisition.
On 5 November 2015 the Group announced that it had agreed
compensation from Sanofi Pasteur following the suspension of
manufacturing since mid--2012 of the bladder cancer treatment
ImmuCyst(TM). Alliance will receive GBP6.7 million in cash,
inclusive of costs, in full and final settlement of its claims.
Alliance will continue to distribute ImmuCyst(TM) in the UK and is
seeking to bring the product back into supply before the end of the
year. The Group does however expect that future stocks of
ImmuCyst(TM) will be constrained. The Group further announced that
the proceeds of the settlement agreement would be used to reduce
the Group's net bank debt.
Since the results for the six months ended 30 June 2015, which
were announced on 9 September 2015, the Group's overall trading
performance has been in line with the Directors' expectations.
Healthcare Products Business
The Healthcare Products Business achieved sales of GBP43.3
million in the 12 months ended 30 June 2015 with a gross profit for
the period of GBP22.2 million. The Directors believe that sales for
the period were impacted by distributors building inventory for
launch campaigns between April and December 2014 and that this
should normalise in the 12 months ended 31 December 2016. The key
growth products performed strongly over the period with
Kelo-cote(TM) achieving sales of GBP8.0 million; Flamma Franchise
(including Flammacerium(TM)) GBP7.1 million; Aloclair(TM) GBP4.0
million; Kelo--stretch(TM) GBP2.7 million and Atopiclair(TM) GBP2.0
million. Sales of the Healthcare Products have remained stable
since 30 June 2015.
17. Re-admission to AIM
Application will be made to the London Stock Exchange for
Re-admission. It is expected that dealings in the Existing Issued
Share Capital will be suspended from 4.30 p.m. on 16 December 2015
and that Re-admission will become effective and dealings in the
Enlarged Issued Share Capital will commence on AIM at 8.00 a.m. on
17 December 2015.
18. General Meeting
The General Meeting has been convened for 10.00 a.m. on 14
December 2015 to be held at the offices of Fasken Martineau LLP, 17
Hanover Square, London W1S 1HU. You will find set out at the end of
the Admission Document the Notice of General Meeting convening the
General Meeting for the purposes of considering and, if thought
fit, approving the following resolutions:
-- Resolution 1 is an ordinary resolution to approve the
Acquisition for the purposes of the AIM Rules for Companies;
and
-- Resolution 2 is an ordinary resolution to authorise the
Directors under Section 551 of the Act to allot equity securities
up to an aggregate nominal value of GBP2,036,585.35 in connection
with the Placing and Acquisition Agreement.
19. Action to be taken
Shareholders will find enclosed with the Admission Document a
Form of Proxy, for use in connection with the General Meeting.
Whether or not you intend to be present at the General Meeting, you
are asked to complete and return the Form of Proxy in accordance
with the instructions printed thereon as soon as possible but in
any event so as to arrive no later than 10.00 a.m. on 12 December
2015, being 48 hours before the time appointed for the holding of
the General Meeting. Completion and posting of a Form of Proxy will
not prevent you from attending and voting in person at the General
Meeting if you so wish.
20. Shareholder Irrevocables
The Directors and their associated interests have each
irrevocably undertaken to vote in favour of the Resolutions in
respect of their beneficial holdings in the Ordinary Shares,
amounting to 62,046,048 Ordinary Shares, in aggregate, representing
approximately 23.5 per cent. of the Existing Issued Share
Capital.
In addition, the Company has received irrevocable undertakings
to vote in favour of the Resolutions from various Shareholders in
respect of their beneficial holdings in Ordinary Shares, amounting
to 61,438,410 Ordinary Shares, in aggregate, representing
approximately 23.2 per cent. of the Existing Issued Share
Capital.
As such, as at the date of this Announcement, the Company has
received irrevocable undertakings to vote in favour of the
Resolutions in respect of 123,484,458 Ordinary Shares, in
aggregate, representing approximately 46.7 per cent. of the
Existing Issued Share Capital.
21. Recommendation
The Directors believe that the Proposals are in the best
interests of the Company and the Shareholders as a whole.
Accordingly the Directors unanimously recommend that
Shareholders vote in favour of the Resolutions to be proposed at
the General Meeting, as they have irrevocably undertaken to do in
respect of their own beneficial holdings.
APPENDIX
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING
THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX (TOGETHER, THE
"ANNOUNCEMENT") AND THE INFORMATION IN IT, IS RESTRICTED, AND IS
NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES,
CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF SOUTH
AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR
DISTRIBUTION WOULD BE UNLAWFUL.
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES
ONLY.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN
ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A)
PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE
QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF THE FINANCIAL
SERVICES AND MARKETS ACT 2000, AS AMENDED, ("QUALIFIED INVESTORS")
BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE
EU PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC AND
INCLUDES ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER
STATE) (THE "PROSPECTUS DIRECTIVE"); (B) IN THE UNITED KINGDOM,
QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) FALL WITHIN ARTICLE
19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL
PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER"); (II) FALL WITHIN
ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS, ETC") OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT
MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER
BEING REFERRED TO AS "RELEVANT PERSONS"). THIS APPENDIX AND THE
TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED
ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR
INVESTMENT ACTIVITY TO WHICH THIS APPENDIX AND THE TERMS AND
CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT
PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.
THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS FOR INFORMATION
PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT
HAS BEEN ISSUED BY AND IS THE SOLE RESPONSIBILITY OF THE
COMPANY.
THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS NOT AN OFFER FOR
SALE OR SUBSCRIPTION IN ANY JURISDICTION IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF
ANY SUCH JURISDICTION. THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX,
IS NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR
SECURITIES IN THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN
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, EXCEPT PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. NEITHER THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION NOR ANY SECURITIES
REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE
UNITED STATES HAS APPROVED OR DISAPPROVED OF AN INVESTMENT IN THE
SECURITIES OR PASSED UPON OR ENDORSED THE MERITS OF THE PLACING OR
THE ACCURACY OR ADEQUACY OF THE CONTENTS OF THIS ANNOUNCEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED
STATES. NO PUBLIC OFFERING OF SECURITIES IS BEING MADE IN THE
UNITED STATES. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY
PERSON INSIDE THE UNITED STATES IS BEING SOLICITED AND, IF SENT IN
RESPONSE TO THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL
NOT BE ACCEPTED.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING
SHARES. THE PRICE OF SHARES IN THE COMPANY AND THE INCOME FROM THEM
(IF ANY) MAY GO DOWN AS WELL AS UP AND INVESTORS MAY NOT GET BACK
THE FULL AMOUNT INVESTED ON DISPOSAL OF SHARES.
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November 26, 2015 02:01 ET (07:01 GMT)
Persons who are invited to and who choose to participate in the
Placing, by making (or on whose behalf there is made) an oral or
written offer to subscribe for Placing Shares (the "Placees"), will
be deemed to have read and understood this Announcement, including
this Appendix, in its entirety and to be making such offer on the
terms and conditions, and to be providing the representations,
warranties, acknowledgements, and undertakings contained in this
Appendix. In particular, each such Placee represents, warrants and
acknowledges that:
1. it is a Relevant Person (as defined above) and undertakes
that it will acquire, hold, manage or dispose of any Placing Shares
that are allocated to it for the purposes of its business;
2. in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the
Prospectus Directive, (i) the Placing Shares acquired by it have
not been acquired on behalf of, nor have they been acquired with a
view to their offer or resale to, persons in any Member State of
the European Economic Area ("EEA") which has implemented the
Prospectus Directive other than Qualified Investors or in
circumstances in which the prior consent of Numis has been given to
the offer or resale; or (ii) where Placing Shares have been
acquired by it on behalf of persons in any Member State of the EEA
other than Qualified Investors, the offer of those Placing Shares
to it is not treated under the Prospectus Directive as having been
made to such persons; and/or
3. (a) (i) it is not in the United States and (ii) it is not
acting for the account or benefit of a person in the United States,
(b) it is a dealer or other professional fiduciary in the United
States acting on a discretionary basis for a non-US person (other
than an estate or trust) in reliance on Regulation S under the
Securities Act; or (c) it is otherwise acquiring the Placing Shares
in an "offshore transaction" meeting the requirements of Regulation
S under the Securities Act.
The Company and Numis will rely upon the truth and accuracy of
the foregoing representations, acknowledgements and agreements.
This Announcement does not constitute an offer, and may not be
used in connection with an offer, to sell or issue or the
solicitation of an offer to buy or subscribe for Placing Shares in
any jurisdiction in which such offer or solicitation is or may be
unlawful. This Announcement and the information contained herein is
not for publication or distribution, directly or indirectly, to
persons in the United States, Canada, Australia, New Zealand, Japan
or the Republic of South Africa or in any jurisdiction in which
such publication or distribution is unlawful. Persons into whose
possession this Announcement may come are required by the Company
to inform themselves about and to observe any restrictions of
transfer of this Announcement. No public offer of securities of the
Company is being made in the United Kingdom, the United States or
elsewhere.
In particular, the Placing Shares referred to in this
Announcement have not been and will not be registered under the
Securities Act or any laws of, or with any securities regulatory
authority of, any state or other jurisdiction of the United States,
and may not be offered, sold, pledged or otherwise transferred
within the United States except pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of
the Securities Act and the securities laws of any state or other
jurisdiction of the United States. The Placing Shares are being
offered and sold outside the United States in accordance with
Regulation S under the Securities Act.
The Placing Shares have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States.
The relevant clearances have not been, nor will they be,
obtained from the securities commission of any province or
territory of Canada; no prospectus has been lodged with or
registered by the Australian Securities and Investments Commission
or the Japanese Ministry of Finance; and the Placing Shares have
not been, nor will they be, registered under or offered in
compliance with the securities laws of any state, province or
territory of Canada, Australia, New Zealand, Japan or the Republic
of South Africa. Accordingly, the Placing Shares may not (unless an
exemption under the relevant securities laws is applicable) be
offered, sold, resold or delivered, directly or indirectly, in or
into Canada, Australia, New Zealand, Japan or the Republic of South
Africa or any other jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of this Appendix or the Announcement of which it forms part should
seek appropriate advice before taking any action.
In this Appendix, unless the context otherwise requires,
"Placee" means a Relevant Person (including individuals, funds or
otherwise) by whom or on whose behalf a commitment to subscribe for
Placing Shares has been given.
Details of the Placing
Numis has entered into the Placing Agreement with the Company
under which Numis has, on the terms and subject to the conditions
set out therein, undertaken to use its reasonable endeavours to
procure, as agent for the Company, subscribers for the Vendor
Consideration Shares at the Placing Price. The Vendor Placing is
being underwritten by Numis.
The issue of the Vendor Consideration Shares is to be effected
by way of a vendor placing in connection with the Acquisition. The
Company will allot and issue the Vendor Consideration Shares on a
non-pre-emptive basis to Numis or, as directed by Numis, such
Placees in consideration for Numis paying the net proceeds of the
subscription of the Vendor Consideration Shares to the Vendor in
part satisfaction of the payment obligations of APL, being a wholly
owned subsidiary of the Company, under the Acquisition
Agreement.
In addition, the Company has also granted the Option to Numis in
order to enable Numis to deal with additional demand under the
Placing in the event that requests to participate in the Placing
from institutional investors and certain other investors are
received during the period from the date of this Announcement to
5.00 p.m. on 2 December 2015.
The Option is exercisable on more than one occasion at any time
prior to 5.00 p.m. on 2 December 2015. Any Ordinary Shares issued
pursuant to the exercise of the Option will be issued on the same
terms and conditions as the Vendor Consideration Shares. The Option
may be exercised by Numis, following consultation with the Company,
but there is no obligation on Numis to exercise the Option or to
seek to procure subscribers for Ordinary Shares pursuant to the
Option. The maximum number of new Ordinary Shares that may be
issued pursuant to the exercise of the Option is 12,195,121. The
maximum number of Ordinary Shares (including Ordinary Shares issued
pursuant to exercise of the Option) that may be issued pursuant to
the Placing is 203,658,535.
The Placing Agreement contains customary warranties given by the
Company to Numis as to matters relating to the Company and its
business and a customary indemnity given by the Company to Numis in
respect of liabilities arising out of or in connection with the
Placing. The Placing is conditional upon, amongst other things, the
Acquisition Agreement becoming unconditional in all respects (save
for Re-admission) and the Resolutions being passed by the requisite
majorities.
An admission document explaining the background to and reasons
for the Placing and the Acquisition, and containing the Notice of
General Meeting will be sent to shareholders. A copy of the
Admission Document and the Notice of General Meeting will also be
available from the Company's website at:
www.alliancepharmaceuticals.com.
The Placing is also conditional upon Re-admission becoming
effective and the Placing Agreement not being terminated in
accordance with its terms.
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing issued
Ordinary Shares, including the right to receive all dividends and
other distributions (if any) declared, made or paid on or in
respect of the Ordinary Shares following Re-admission.
The Company, subject to certain exceptions, has agreed not to
allot, issue or grant any rights in respect of its Ordinary Shares
in the period of 12 months from the date of Re-admission without
the prior written consent of Numis (such consent not to be
unreasonably withheld or delayed).
Application for admission to trading
Application will be made to the London Stock Exchange for
Re-admission. Subject to, amongst other things, the Resolutions
being passed by the requisite majorities at the General Meeting, it
is expected that settlement of any such shares and Re-admission
will become effective on or around 17 December 2015 and that
dealings in the Placing Shares will commence at that time.
Participation in, and principal terms of, the Placing
1. Numis (whether through itself or any of its affiliates) is
arranging the Placing as placing agent of (a) the Company for the
purpose of using reasonable endeavours to procure Placees at the
Placing Price for the Vendor Consideration Shares and (b) the
Company for the purpose of placing the Option Shares (if any) at
the Placing Price.
2. Participation in the Placing will only be available to
persons who may lawfully be, and are, invited to participate by
Numis. Numis and its affiliates may participate in the Placing as
principal.
(MORE TO FOLLOW) Dow Jones Newswires
November 26, 2015 02:01 ET (07:01 GMT)
3. This Appendix gives details of the terms and conditions of,
and the mechanics of participation in, the Placing.
4. The Placing Price will be a fixed price of 41 pence per new Ordinary Share.
5. An offer to take up Placing Shares which has been
communicated by a prospective Placee to Numis which has not been
withdrawn or revoked prior to publication of this Announcement will
not be capable of variation or revocation following the publication
of this Announcement.
6. Each Placee's allocation will be confirmed to Placees orally
by Numis, and evidenced by a trade confirmation or contract note
which will be dispatched as soon as practicable thereafter. The
terms of this Appendix will be deemed incorporated by reference
therein. The oral confirmation to such Placee will constitute an
irrevocable legally binding commitment upon such person (who will
at that point become a Placee) in favour of Numis and the Company,
under which it agrees to acquire the number of Placing Shares
allocated to it at the Placing Price on the terms and conditions
set out in this Appendix and in accordance with the Company's
Articles of Association.
7. Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to Numis, to pay in cleared funds
immediately on the settlement date, in accordance with the
registration and settlement requirements set out below, an amount
equal to the product of the Placing Price and the number of Placing
Shares such Placee has agreed to take up and the Company has agreed
to allot.
8. Except as required by law or regulation, no press release or
other announcement will be made by Numis or the Company using the
name of any Placee (or its agent), in its capacity as Placee (or
agent), other than with such Placee's prior written consent.
9. Irrespective of the time at which a Placee's allocation
pursuant to the Placing is confirmed, settlement for all Placing
Shares to be acquired pursuant to the Placing will be required to
be made at the same time, on the basis explained below under
"Registration and settlement".
10. All obligations under the Placing will be subject to
fulfilment or (where applicable) waiver of, amongst other things,
the conditions referred to below under "Conditions of the Placing"
and to the Placing not being terminated on the basis referred to
below under "Right to terminate under the Placing Agreement".
11. By participating in the Placing, each Placee will agree that
its rights and obligations in respect of the Placing will terminate
only in the circumstances described below and will not be capable
of rescission or termination by the Placee.
12. To the fullest extent permissible by law, none of the
Company, Numis or any of their respective affiliates shall have any
liability to Placees (or to any other person whether acting on
behalf of a Placee or otherwise). In particular, none of the
Company, Numis or any of their respective affiliates shall have any
liability (including to the fullest extent permissible by law, any
fiduciary duties) in respect of Numis' conduct of the Placing. Each
Placee acknowledges and agrees that the Company is responsible for
the allotment of the Placing Shares to the Placees and Numis shall
have no liability to the Placees for the failure of the Company to
fulfil those obligations.
Conditions of the Placing
Numis' obligations under the Placing Agreement in respect of the
Placing Shares are conditional on, inter alia:
(a) the Acquisition Agreement (i) not having lapsed or been
terminated and (ii) having become unconditional in all respects
(save for (A) Re-admission and (B) any conditions relating to the
Placing Agreement having become unconditional or not having
terminated prior to Re-admission) and having been completed in
accordance with its terms;
(b) the Facility Agreement becoming unconditional in all
respects on or prior to Re-admission (save for any condition
relating to the Vendor Placing or Admission);
(c) the Company allotting, subject only to Re-admission, the
Placing Shares in accordance with the Placing Agreement;
(d) Admission taking place not later than 8.00 a.m. on 17
December 2015; and
(e) the passing (without any amendment, save as agreed by Numis)
of the Resolutions at the General Meeting.
If (i) any of the conditions contained in the Placing Agreement
in relation to the Placing Shares are not fulfilled or waived by
Numis by the respective time or date where specified (or such later
time or date as the Company and Numis may agree not being later
than 8.30 a.m. on 28 December 2015 (the "Final Date"), or (ii) the
Placing Agreement is terminated as described below, the Placing in
relation to the Placing Shares will lapse and the Placee's rights
and obligations hereunder in relation to the Placing Shares shall
cease and terminate at such time and each Placee agrees that no
claim can be made by the Placee in respect thereof.
Numis may, at its absolute discretion and upon such terms as it
thinks fit, waive, or extend the period (up to the Final Date) for,
compliance by the Company with the whole or any part of any of the
Company's obligations in relation to the conditions in the Placing
Agreement, save that the conditions relating to the passing of the
Resolutions, Re-admission taking place and the Acquisition
Agreement and the Facility Agreement becoming unconditional may not
be waived. Any such extension or waiver will not affect Placees'
commitments as set out in this Announcement.
Neither Numis nor the Company shall have any liability to any
Placee (or to any other person whether acting on behalf of a Placee
or otherwise) in respect of any decision they may make as to
whether or not to waive or to extend the time and/or date for the
satisfaction of any condition to the Placing nor for any decision
they may make as to the satisfaction of any condition or in respect
of the Placing generally and by participating in the Placing each
Placee agrees that any such decision is within the absolute
discretion of Numis.
Right to terminate under the Placing Agreement
Numis is entitled, at any time before Admission, to terminate
the Placing Agreement by giving notice to the Company in certain
circumstances, including, inter alia:
(a) in the opinion of Numis (acting in good faith), the
warranties given by the Company to Numis are not true and accurate
or have become misleading (or would not be true and accurate or
would be misleading if they were repeated at any time before
Admission) by reference to the facts subsisting at the time when
the notice referred to above is given, in each case in a way that
is material in the context of the Proposals; or
(b) in the opinion of Numis (acting in good faith), the Company
fails to comply with any of its obligations under the Placing
Agreement and that failure is material in the context of the
Proposals; or
(c) in the opinion of Numis (acting in good faith), there has
been a development or event (or any development or event involving
a prospective change which will or is reasonably likely to have a
material adverse effect on or affecting the operations, the
condition (financial or otherwise), prospects, management, results
of operations, financial position, business or general affairs of
the Company or the Group or the Healthcare Products Business
respectively whether or not foreseeable and whether or not arising
in the ordinary course of business, which in each case is material
in the context of the Proposals; or
(d) there has been a change in national or international
financial, political, economic or stock market conditions (primary
or secondary); an incident of terrorism, outbreak or escalation of
hostilities, war, declaration of martial law or any other calamity
or crisis; a suspension or material limitation in trading of
securities generally on any stock exchange; any change in currency
exchange rates or exchange controls or a disruption of settlement
systems or a material disruption in commercial banking, in each
case as would be likely in the opinion of Numis (acting in good
faith) to materially prejudice the success of the Proposals.
Following Re-admission, the Placing Agreement is not capable of
termination to the extent that it relates to the Placing of the
Placing Shares.
The rights and obligations of the Placees shall terminate only
in the circumstances described in these terms and conditions and in
the Placing Agreement and will not be subject to termination by the
Placee or any prospective Placee at any time or in any
circumstances. By participating in the Placing, Placees agree that
the exercise by Numis of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Numis, and that it need not make any reference to
Placees and that it shall have no liability to Placees whatsoever
in connection with any such exercise or decision not to exercise.
Placees will have no rights against Numis, the Company or any of
their respective directors or employees under the Placing Agreement
pursuant to the Contracts (Rights of Third Parties) Act 1999 (as
amended).
No Prospectus
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November 26, 2015 02:01 ET (07:01 GMT)
The Placing Shares are being offered to a limited number of
specifically invited persons only and will not be offered in such a
way as to require a prospectus in the United Kingdom or in any
other jurisdiction. No prospectus has been or will be submitted to
be approved by the FCA or submitted to the London Stock Exchange in
relation to the Placing, and Placees' commitments will be made
solely on the basis of the information contained in this
Announcement, the Admission Document and this Appendix. Each
Placee, by accepting a participation in the Placing, agrees that
the content of this Announcement is exclusively the responsibility
of the Company and confirms that it has neither received nor relied
on any other information, representation, warranty, or statement
made by or on behalf of the Company or Numis or any other person
and neither Numis nor the Company nor any other person will be
liable for any Placee's decision to participate in the Placing
based on any other information, representation, warranty or
statement which the Placees may have obtained or received and, if
given or made, such information, representation, warranty or
statement must not be relied upon as having been authorised by
Numis, the Company, or their respective officers, directors,
employees or agents. Each Placee acknowledges and agrees that it
has relied on its own investigation of the business, financial or
other position of the Company in accepting a participation in the
Placing. Neither the Company, nor Numis are making any undertaking
or warranty to any Placee regarding the legality of an investment
in the Placing Shares by such Placee under any legal, investment or
similar laws or regulations. Each Placee should not consider any
information in this Announcement to be legal, tax or business
advice. Each Placee should consult its own solicitor, tax adviser
and financial adviser for independent legal, tax and financial
advice regarding an investment in the Placing Shares. Nothing in
this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
Registration and settlement
Settlement of transactions in the Placing Shares (ISIN:
GB0031030819) following Re-admission will take place within CREST
provided that, subject to certain exceptions, Numis reserves the
right to require settlement for, and delivery of, the Placing
Shares (or a portion thereof) to Placees by such other means that
it deems necessary if delivery or settlement is not possible or
practicable within CREST within the timetable set out in the
Admission Document or would not be consistent with the regulatory
requirements in any Placee's jurisdiction.
Each Placee allocated Placing Shares in the Placing will be sent
a trade confirmation or contract note stating the number of Placing
Shares allocated to it at the Placing Price, the aggregate amount
owed by such Placee to Numis (as agent for the Company) and
settlement instructions. Each Placee agrees that it will do all
things necessary to ensure that delivery and payment is completed
in accordance with either the CREST or certificated settlement
instructions that it has in place with Numis.
It is expected that settlement in respect of the Placing Shares
will be on 17 December 2015 in accordance with the instructions set
out in the trade confirmation.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above at the rate of two percentage points above LIBOR as
determined by Numis.
Each Placee is deemed to agree that, if it does not comply with
these obligations, Numis may sell any or all of the Placing Shares
allocated to that Placee on such Placee's behalf and retain from
the proceeds, for Numis' account and benefit (as agent for the
Company), an amount equal to the aggregate amount owed by the
Placee plus any interest due. The relevant Placee will, however,
remain liable and shall indemnify Numis on demand for any shortfall
below the aggregate amount owed by it and may be required to bear
any stamp duty or stamp duty reserve tax or securities transfer tax
(together with any interest or penalties) which may arise upon the
sale of such Placing Shares on such Placee's behalf. By
communicating a bid for Placing Shares, each Placee confers on
Numis all such authorities and powers necessary to carry out any
such sale and agrees to ratify and confirm all actions which Numis
lawfully takes in pursuance of such sale.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the trade confirmation
or contract note is copied and delivered immediately to the
relevant person within that organisation.
Insofar as Placing Shares are registered in a Placee's name or
that of its nominee or in the name of any person for whom a Placee
is contracting as agent or that of a nominee for such person, such
Placing Shares should, subject as provided below, be so registered
free from any liability to UK stamp duty or stamp duty reserve tax
or securities transfer tax. Placees will not be entitled to receive
any fee or commission in connection with the Placing.
Representations, warranties and further terms
By participating in the Placing each Placee (and any person
acting on such Placee's behalf) makes the following
representations, warranties, acknowledgements, agreements and
undertakings (as the case may be) to the Company and Numis, namely
that, each Placee (and any person acting on such Placee's
behalf):
1. represents and warrants that it has read and understood this
Announcement, the Admission Document and this Appendix, in its
entirety and that its subscription of Placing Shares is subject to
and based upon all the terms, conditions, representations,
warranties, acknowledgements, agreements and undertakings and other
information contained therein and undertakes not to redistribute or
duplicate this Announcement and the Admission Document;
2. acknowledges that no prospectus has been prepared in
connection with the Placing and represents and warrants that it has
not received and will not receive a prospectus in connection
therewith;
3. acknowledges that none of Numis, the Company, any of their
respective affiliates or any person acting on behalf of any of them
has provided it, and will not provide it, with any material
regarding the Placing Shares or the Company other than this
Announcement and the Admission Document; nor has it requested any
of Numis, the Company, their respective affiliates or any person
acting on behalf of any of them to provide it with any such
information;
4. acknowledges that the contents of this Announcement and the
Admission Document are exclusively the responsibility of the
Company and the Directors, and that none of Numis, its affiliates
or any person acting on its or their behalf has or shall have any
liability for any information, representation or statement
contained in this Announcement and the Admission Document or any
information previously or concurrently published by or on behalf of
the Company, and will not be liable for any Placee's decision to
participate in the Placing based on any information, representation
or statement contained in this Announcement and the Admission
Document or otherwise. Each Placee further represents, warrants and
agrees that the only information on which it is entitled to rely
and on which such Placee has relied in committing itself to acquire
the Placing Shares is contained in this Announcement and the
Admission Document, such information being all that it deems
necessary to make an investment decision in respect of the Placing
Shares and that it has neither received nor relied on any other
information given or representations, warranties or statements made
by Numis, the Company or any of their respective directors,
officers or employees or any person acting on behalf of any of
them, or, if received, it has not relied upon any such information,
representations, warranties or statements (including any management
presentation that may have been received by any prospective Placee
or any material prepared by the Research Department of Numis (the
views of such Research Department not representing and being
independent from those of the Company and the Corporate Finance
Department of Numis and not being attributable to the same)), and
neither Numis nor the Company will be liable for any Placee's
decision to accept an invitation to participate in the Placing
based on any other information, representation, warranty or
statement. Each Placee further acknowledges and agrees that it has
relied solely on its own investigation of the business, financial
or other position of the Company in deciding to participate in the
Placing and it will not rely on any investigation that Numis, its
affiliates or any other person acting on its or their behalf has or
may have conducted;
5. represents and warrants that it has neither received nor
relied on any confidential price sensitive information concerning
the Company in accepting this invitation to participate in the
Placing;
6. acknowledges that Numis does not have any duties or
responsibilities to it, or its clients, similar or comparable to
the duties of "best execution" and "suitability" imposed by the
Conduct of Business Sourcebook in the FCA's Handbook of Rules and
Guidance and that Numis is not acting for it or its clients and
that Numis will not be responsible for providing protections to it
or its clients;
7. acknowledges that none of Numis, any of its affiliates or any
person acting on behalf of it or them has or shall have any
liability for the Admission Document, any publicly available or
filed information or any representation relating to the Company,
provided that nothing in this paragraph excludes the liability of
any person for fraudulent misrepresentation made by that
person;
(MORE TO FOLLOW) Dow Jones Newswires
November 26, 2015 02:01 ET (07:01 GMT)
8. that, save in the event of fraud on the part of Numis (and to
the extent permitted by the Rules of the FCA), neither Numis, its
ultimate holding company nor any direct or indirect subsidiary
undertakings of that holding company, nor any of their respective
directors and employees shall be liable to Placees for any matter
arising out of Numis' role as placing agent or otherwise in
connection with the Placing and that where any such liability
nevertheless arises as a matter of law Placees will immediately
waive any claim against any of such persons which they may have in
respect thereof;
9. represents and warrants that (i) it is not in the United
States and (ii) it is not acting for the account or benefit of a
person in the United States;
10. acknowledges that the Placing Shares are being offered and
sold only pursuant to Regulation S under the Securities Act in a
transaction not involving a public offering of securities in the
United States and the Placing Shares have not been and will not be
registered under the Securities Act or with any state or other
jurisdiction of the United States, nor approved or disapproved by
the US Securities and Exchange Commission, any state securities
commission in the United States or any other United States
regulatory authority, and that the offer and sale of the Placing
Shares to it has been made outside of the United States in an
'offshore transaction' (as such term is defined in Regulation S
under the Securities Act) and agrees not to reoffer, resell, pledge
or otherwise transfer the Placing Shares except pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and otherwise in
accordance with any applicable securities laws of any state or
jurisdiction of the United States;
11. unless otherwise specifically agreed in writing with Numis,
represents and warrants that neither it nor the beneficial owner of
such Placing Shares will be a resident of Canada, Australia, New
Zealand, Japan or the Republic of South Africa;
12. acknowledges that the Placing Shares have not been and will
not be registered under the securities legislation of Canada,
Australia, New Zealand, Japan or the Republic of South Africa and,
subject to certain exceptions, may not be offered, sold, taken up,
renounced or delivered or transferred, directly or indirectly,
within those jurisdictions;
13. represents and warrants that the issue to it, or the person
specified by it for registration as holder, of Placing Shares will
not give rise to a liability under any of sections 67, 70, 93 or 96
of the Finance Act 1986 (depositary receipts and clearance
services) and that the Placing Shares are not being acquired in
connection with arrangements to issue depositary receipts or to
transfer Placing Shares into a clearance system;
14. represents and warrants that: (i) it has complied with its
obligations under the Criminal Justice Act 1993 and Part VIII of
FSMA; (ii) in connection with money laundering and terrorist
financing, it has complied with its obligations under the Proceeds
of Crime Act 2002 (as amended), the Terrorism Act 2000 (as
amended), the Terrorism Act 2006 and the Money Laundering
Regulations 2007; and (iii) it is not a person: (a) with whom
transactions are prohibited under the Foreign Corrupt Practices Act
of 1977 or any economic sanction programmes administered by, or
regulations promulgated by, the Office of Foreign Assets Control of
the U.S. Department of the Treasury; (b) named on the Consolidated
List of Financial Sanctions Targets maintained by HM Treasury of
the United Kingdom; or (c) subject to financial sanctions imposed
pursuant to a regulation of the European Union or a regulation
adopted by the United Nations (together, the "Regulations"); and,
if making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations and has
obtained all governmental and other consents (if any) which may be
required for the purpose of, or as a consequence of, such purchase,
and it will provide promptly to Numis such evidence, if any, as to
the identity or location or legal status of any person which Numis
may request from it in connection with the Placing (for the purpose
of complying with such Regulations or ascertaining the nationality
of any person or the jurisdiction(s) to which any person is subject
or otherwise) in the form and manner requested by Numis on the
basis that any failure by it to do so may result in the number of
Placing Shares that are to be purchased by it or at its direction
pursuant to the Placing being reduced to such number, or to nil, as
Numis may decide at its sole discretion;
15. if a financial intermediary, as that term is used in Article
3(2) of the Prospectus Directive, represents and warrants that the
Placing Shares purchased by it in the Placing will not be acquired
on a non-discretionary basis on behalf of, nor will they be
acquired with a view to their offer or resale to, persons in a
Member State of the European Economic Area which has implemented
the Prospectus Directive other than Qualified Investors, or in
circumstances in which the prior consent of Numis has been given to
the offer or resale;
16. represents and warrants that it has not offered or sold and
will not offer or sell any Placing Shares to persons in the
European Economic Area prior to Re-admission except to persons
whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for
the purposes of their business or otherwise in circumstances which
have not resulted in and which will not result in an offer to the
public in any member state of the European Economic Area within the
meaning of the Prospectus Directive (including any relevant
implementing measure in any member state);
17. represents and warrants that it has only communicated or
caused to be communicated and will only communicate or cause to be
communicated any invitation or inducement to engage in investment
activity (within the meaning of section 21 of the FSMA) relating to
the Placing Shares in circumstances in which section 21(1) of the
FSMA does not require approval of the communication by an
authorised person;
18. represents and warrants that it has complied and will comply
with all applicable provisions of the FSMA with respect to anything
done by it in relation to the Placing Shares in, from or otherwise
involving, the United Kingdom;
19. if in a Member State of the European Economic Area, unless
otherwise specifically agreed with Numis in writing, represents and
warrants that it is a Qualified Investor within the meaning of the
Prospectus Directive;
20. if in the United Kingdom, represents and warrants that it is
a person (i) who has professional experience in matters relating to
investments falling within Article 19(1) of the Order; (ii) falling
within Article 49(2)(A) to (D) ("High Net Worth Companies,
Unincorporated Associations, etc") of the Order; or (iii) to whom
this Announcement and the Admission Document may otherwise be
lawfully communicated;
21. represents and warrants that it and any person acting on its
behalf is entitled to acquire the Placing Shares under the laws of
all relevant jurisdictions and that it has all necessary capacity
and has obtained all necessary consents and authorities and taken
any other necessary actions to enable it to commit to this
participation in the Placing and to perform its obligations in
relation thereto (including, without limitation, in the case of any
person on whose behalf it is acting, all necessary consents and
authorities to agree to the terms set out or referred to in this
Appendix) and will honour such obligations;
22. where it is acquiring Placing Shares for one or more managed
accounts, represents and warrants that it is authorised in writing
by each managed account: (a) to acquire the Placing Shares for each
managed account; (b) to make on its behalf the representations,
warranties, acknowledgements, undertakings and agreements in this
Appendix, the Announcement and the Admission Document of which it
forms part; and (c) to receive on its behalf any investment letter
relating to the Placing in the form provided to it by Numis;
23. undertakes that it (and any person acting on its behalf)
will make payment for the Placing Shares allocated to it in
accordance with this Announcement on the due time and date set out
herein, failing which the relevant Placing Shares may be placed
with other subscribers or sold as Numis may in its sole discretion
determine and without liability to such Placee and it will remain
liable and will indemnify Numis on demand for any shortfall below
the net proceeds of such sale and the placing proceeds of such
Placing Shares and may be required to bear the liability for any
stamp duty or stamp duty reserve tax or security transfer tax
(together with any interest or penalties due pursuant to or
referred to in these terms and conditions) which may arise upon the
placing or sale of such Placee's Placing Shares on its behalf;
(MORE TO FOLLOW) Dow Jones Newswires
November 26, 2015 02:01 ET (07:01 GMT)
24. acknowledges that none of Numis, any of its affiliates, or
any person acting on behalf of any of them, is making any
recommendations to it, advising it regarding the suitability of any
transactions it may enter into in connection with the Placing and
that participation in the Placing is on the basis that it is not
and will not be treated for these purposes as a client of Numis and
that Numis has no duties or responsibilities to it for providing
the protections afforded to its clients or customers or for
providing advice in relation to the Placing nor in respect of any
representations, warranties, undertakings or indemnities contained
in the Placing Agreement nor for the exercise or performance of any
of its rights and obligations thereunder including any rights to
waive or vary any conditions or exercise any termination right;
25. undertakes that the person whom it specifies for
registration as holder of the Placing Shares will be (i) itself or
(ii) its nominee, as the case may be. Neither Numis nor the Company
will be responsible for any liability to stamp duty or stamp duty
reserve tax resulting from a failure to observe this requirement.
Each Placee and any person acting on behalf of such Placee agrees
to participate in the Placing and it agrees to indemnify the
Company and Numis in respect of the same on the basis that the
Placing Shares will be allotted to the CREST stock account of Numis
who will hold them as nominee on behalf of such Placee until
settlement in accordance with its standing settlement
instructions;
26. acknowledges that these terms and conditions and any
agreements entered into by it pursuant to these terms and
conditions and any non-contractual obligations arising out of or in
connection with such agreement shall be governed by and construed
in accordance with the laws of England and Wales and it submits (on
behalf of itself and on behalf of any person on whose behalf it is
acting) to the exclusive jurisdiction of the English courts as
regards any claim, dispute or matter (including non-contractual
matters) arising out of any such contract, except that enforcement
proceedings in respect of the obligation to make payment for the
Placing Shares (together with any interest chargeable thereon) may
be taken by the Company or Numis in any jurisdiction in which the
relevant Placee is incorporated or in which any of its securities
have a quotation on a recognised stock exchange;
27. acknowledges that time shall be of the essence as regards to
obligations pursuant to this Appendix;
28. agrees that the Company, Numis and their respective
affiliates and others will rely upon the truth and accuracy of the
foregoing representations, warranties, acknowledgements and
undertakings which are given to Numis on its own behalf and on
behalf of the Company and are irrevocable and are irrevocably
authorised to produce this Announcement or a copy thereof to any
interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby;
29. agrees to indemnify on an after-tax basis and hold the
Company, Numis and their respective affiliates harmless from any
and all costs, claims, liabilities and expenses (including legal
fees and expenses) arising out of or in connection with any breach
of the representations, warranties, acknowledgements, agreements
and undertakings in this Appendix and further agrees that the
provisions of this Appendix shall survive after completion of the
Placing;
30. acknowledges that no action has been or will be taken by any
of the Company, Numis or any person acting on behalf of the Company
or Numis that would, or is intended to, permit a public offer of
the Placing Shares in any country or jurisdiction where any such
action for that purpose is required;
31. acknowledges that it is an institution that has knowledge
and experience in financial, business and international investment
matters as is required to evaluate the merits and risks of
subscribing for the Placing Shares. It further acknowledges that it
is experienced in investing in securities of this nature and in
this sector and is aware that it may be required to bear, and it,
and any accounts for which it may be acting, are able to bear, the
economic risk of, and is able to sustain, a complete loss in
connection with the Placing. It has relied upon its own examination
and due diligence of the Company and its associates taken as a
whole, and the terms of the Placing, including the merits and risks
involved;
32. acknowledges that its commitment to subscribe for Placing
Shares on the terms set out herein and in the trade confirmation or
contract note will continue notwithstanding any amendment that may
in future be made to the terms of the Placing and that Placees will
have no right to be consulted or require that their consent be
obtained with respect to the Company's conduct of the Placing;
33. acknowledges that Numis or any of its affiliates acting as
an investor for its own account may take up shares in the Company
and in that capacity may retain, purchase or sell for its own
account such shares and may offer or sell such shares other than in
connection with the Placing;
34. represents and warrants that, if it is a pension fund or
investment company, its purchase of Placing Shares is in full
compliance with all applicable laws and regulation; and
35. to the fullest extent permitted by law, it acknowledges and
agrees to the disclaimers contained in the Announcement, the
Admission Document and this Appendix.
The representations, warranties, acknowledgments and
undertakings contained in this Appendix are given to Numis and the
Company and are irrevocable and shall not be capable of termination
in any circumstances.
The agreement to settle a Placee's subscription (and/or the
subscription of a person for whom such Placee is contracting as
agent) free of stamp duty and stamp duty reserve tax depends on the
settlement relating only to a subscription by it and/or such person
direct from the Company for the Placing Shares in question. Such
agreement assumes that the Placing Shares are not being subscribed
for in connection with arrangements to issue depositary receipts or
to transfer the Placing Shares into a clearance service. If there
are any such arrangements, or the settlement relates to any other
subsequent dealing in the Placing Shares, stamp duty or stamp duty
reserve tax may be payable, for which neither the Company nor Numis
will be responsible, and the Placee to whom (or on behalf of whom,
or in respect of the person for whom it is participating in the
Placing as an agent or nominee) the allocation, allotment, issue or
delivery of Placing Shares has given rise to such UK stamp duty or
stamp duty reserve tax undertakes to pay such UK stamp duty or
stamp duty reserve tax forthwith and to indemnify on an after-tax
basis and to hold harmless the Company and Numis in the event that
any of the Company and/or Numis has incurred any such liability to
UK stamp duty or stamp duty reserve tax. If this is the case, each
Placee should seek its own advice and notify Numis accordingly.
In addition, Placees should note that they will be liable for
any stamp duty and all other stamp, issue, securities, transfer,
registration, documentary or other duties or taxes (including any
interest, fines or penalties relating thereto) payable outside the
UK by them or any other person on the subscription by them of any
Placing Shares or the agreement by them to subscribe for any
Placing Shares.
Each Placee, and any person acting on behalf of the Placee,
acknowledges that Numis does not owe any fiduciary or other duties
to any Placee in respect of any representations, warranties,
undertakings or indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that Numis or any of its affiliates may, at
their absolute discretion, agree to become a Placee in respect of
some or all of the Placing Shares.
When a Placee or person acting on behalf of the Placee is
dealing with Numis, any money held in an account with Numis on
behalf of the Placee and/or any person acting on behalf of the
Placee will not be treated as client money within the meaning of
the rules and regulations of the FCA made under the FSMA. The
Placee acknowledges that the money will not be subject to the
protections conferred by the client money rules; as a consequence,
this money will not be segregated from Numis' money in accordance
with the client money rules and will be used by Numis in the course
of its own business and the Placee will rank only as a general
creditor of Numis.
All times and dates in this Announcement may be subject to
amendment. Numis shall notify the Placees and any person acting on
behalf of the Placees of any changes.
Past performance is no guide to future performance and persons
needing advice should consult an independent financial adviser.
DEFINITIONS
In this Appendix to the Announcement and, as the context shall
admit, in the Announcement:
'Acquisition' means the proposed acquisition by the Company,
through its wholly-owned subsidiary, APL, of the Healthcare
Products Business from the Vendor pursuant to the Acquisition
Agreement;
'Acquisition Agreement' means the conditional sale and purchase
agreement to be entered into between (i) the Company, (ii) APL and
(iii) the Vendor relating to the Acquisition, as more particularly
described in the Admission Document;
'Act' means the Companies Act 2006;
'Admission Document' means the admission document to be issued
by the Company containing, inter alia, further details of the
Proposals and the Notice of General Meeting;
'AIM' means the market of that name operated by the London Stock
Exchange;
'AIM Rules for Companies' means the provisions of the London
Stock Exchange's AIM Rules for Companies as amended from time to
time governing, inter alia, admission to AIM and the continuing
obligations of AIM companies;
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