TIDMDSCV
RNS Number : 1522Q
discoverIE Group plc
17 October 2019
THIS ANNOUNCEMENT, INCLUDING THE APPIX HERETO (TOGETHER, THE
"ANNOUNCEMENT") AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED
AND IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES
(INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATES OF THE
UNITED STATES AND THE DISTRICT OF COLUMBIA), CANADA, AUSTRALIA,
JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR IN OR INTO ANY OTHER
JURISDICTION IN WHICH SUCH PUBLICATION, DISTRIBUTION OR RELEASE
WOULD BE PROHIBITED BY ANY APPLICABLE LAW ("RESTRICTED
JURISDICTIONS").
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE OR FORM PART OF AN OFFER TO SELL OR ISSUE OR A
SOLICITATION TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE, ANY
SECURITIES IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL, INCLUDING THE RESTRICTED
JURISDICTIONS AND NEITHER THIS ANNOUNCEMENT NOR ANYTHING CONTAINED
HEREIN SHALL FORM THE BASIS OF, OR BE RELIED UPON IN CONNECTION
WITH, ANY SUCH OFFER OR SOLICITATION WHATSOEVER IN ANY OF THOSE
JURISDICTIONS.
17 October 2019
discoverIE Group plc
(LSE: DSCV, "discoverIE", the "Company" or the "Group")
Acquisition of Sens-Tech Limited
Proposed placing to raise approximately GBP33m
discoverIE, a leading international designer, manufacturer and
supplier of customised electronics to industry, today announces the
acquisition of Xi-Tech Limited and its wholly-owned subsidiary
Sens-Tech Limited (collectively "Sens-Tech") (the "Acquisition")
together with a proposed placing to raise gross proceeds of
approximately GBP33m (the "Placing").
Highlights of the Acquisition
-- Sens-Tech is a UK-based designer, manufacturer and supplier
of specialist sensing and data acquisition modules for x-ray and
optical detection applications, supplying the transport security,
medical, food processing and industrial markets.
-- Sens-Tech has a global customer base and reported revenue of
GBP15.0m for its year ended 31 March 2018, generating reported
profit before tax of GBP4.4m, and an underlying EBIT of
GBP5.3m.(1)
-- The consideration for Sens-Tech comprises an initial cash
consideration of GBP58.0m on a debt free, cash free basis (the
"Initial Consideration") with further contingent cash consideration
of up to GBP12.0m, payable subject to the achievement of certain
profit growth targets over a three year period.
-- Following on from the successful acquisitions of Hobart and
Positek in April 2019, the Acquisition represents a further step in
the Group's stated strategy. In particular, it:
o Creates further organic growth opportunities in our target
markets, particularly medical, transportation and industrial &
connectivity, with a high proportion of customised products for
long life cycle applications;
o Expands the Group's international footprint with approximately
70% of acquired revenues generated in North America and Asia,
increasing overall Design & Manufacturing ("D&M")
divisional revenues from outside Europe by 2ppts, to 29%, on a pro
forma basis for last year; and
o Enhances underlying operating margins for both the D&M
division (by approximately 1.2ppts) and the Group as a whole (by
approximately 0.8ppts) with Sens-Tech generating operating margins
well ahead of those in both the D&M division and on a Group
level.
-- The Acquisition and the Placing (as described below), taken
together, are expected to be immediately enhancing to underlying
EPS.
Placing highlights
-- Proposed placing of 8,034,840 new ordinary shares of 5 pence
each in the Company (the "Placing Shares"), at a price of 415 pence
per Placing Share, to raise gross proceeds of approximately GBP33m.
The Placing Shares represent approximately 9.96 per cent. of the
Company's existing issued share capital as at the date of this
announcement.
-- The Placing Price represents a discount of 3.9 per cent. to
the closing price of 432 pence per share on 16 October 2019.
-- The Initial Consideration will be satisfied from discoverIE's existing debt facilities.
-- The net proceeds of the Placing, which are expected to be
approximately GBP32m, will be used to reduce the Group's net debt,
to fund working capital and for general corporate purposes.
-- Following the Acquisition and the Placing, gearing,
calculated as net debt to adjusted EBITDA (annualised for
acquisitions), at 30 September 2019 would have increased from 1.4x
to 1.7x on a pro forma basis, remaining within the Company's target
range of 1.5x to 2.0x.
-- The Placing is being conducted through an accelerated book
building process (the "Bookbuild") which will commence immediately
following this Announcement in accordance with the terms and
conditions set out in the Appendix.
-- The Placing is being conducted and fully underwritten by Peel
Hunt LLP ("Peel Hunt"), subject to certain conditions.
Nick Jefferies, Group Chief Executive of discoverIE, said:
"Sens-Tech continues our strategy of building a higher margin,
international Group that designs and manufactures customised
electronics and is one of our largest acquisitions to date. We are
acquiring Sens-Tech, which has a long-established track record of
supplying high quality products, at a time when it is
well-positioned to exploit a range of growth opportunities. We are
delighted to welcome the business and all their employees into the
Group."
Market Abuse Regulation
The information contained within this Announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation ("MAR"). Upon the publication of this
Announcement via a regulatory information service, this inside
information is now considered to be in the public domain.
In addition, market soundings (as defined in MAR) were taken in
respect of the Placing and the Acquisition with the result that
certain persons became aware of inside information (as defined in
MAR), as permitted by MAR. This inside information is set out in
this announcement being made by the Company today. Therefore, those
persons that received inside information in a market sounding are
no longer in possession of such inside information relating to the
Company and its securities.
Enquiries:
discoverIE 01483 544 500
Nick Jefferies, Group Chief Executive
Simon Gibbins, Group Finance Director
Peel Hunt (Broker and bookrunner) 020 7418 8900
Jock Maxwell Macdonald
Mike Bell
Ed Allsopp
Instinctif (Financial PR) 020 7457 2020
Mark Garraway
James Gray
This Announcement should be read in its entirety. In particular,
you should read and understand the information provided in the
"Important Notices" section below.
The Appendix to this Announcement (which forms part of this
Announcement) sets out the terms and conditions of the Placing.
Persons who have chosen to participate in the Placing, by making an
oral or written offer to acquire Placing Shares, will be deemed to
have read and understood this Announcement in its entirety
(including the Appendix) and to be making such offer on the terms
and subject to the conditions herein, and to be providing the
representations, warranties, agreements, acknowledgements and
undertakings contained in the Appendix.
About discoverIE
discoverIE Group plc is an international group of businesses
that designs, manufactures and supplies innovative components for
electronic applications.
The Group provides application-specific components to original
equipment manufacturers ("OEMs") internationally. With in-house
engineering capability, the Group is able to design components to
meet customer requirements, which are then manufactured and
supplied for their ongoing production needs. This generates a high
level of repeating revenue and long term customer
relationships.
By focusing on key markets driven by structural growth and
increasing electronic content, namely renewable energy,
transportation, medical and industrial connectivity, the Group aims
to achieve organic growth that is well ahead of GDP and to
supplement that with targeted complementary acquisitions.
The Group employs c.4,300 people and its principal operating
units are located in Continental Europe, the UK, China, Sri Lanka,
India and North America.
The Group is listed on the Main Market of the London Stock
Exchange and is a member of the FTSE Small Cap Index, classified
within the Electrical Components and Equipment subsector, and has
revenues of over GBP400m. Over the last five years, revenue and
underlying earnings per share has more than doubled.
Background to and reasons for the Acquisition
discoverIE has a clear and established strategy that is building
a high quality, international group designing and manufacturing
customised electronics, through organic growth supplemented by
acquisitions. The Board believes that the acquisition of Sens-Tech
represents a further step in building the D&M division and has
a clear fit with the Group's strategy:
- High proportion of customised products;
- Organic growth opportunities in the Group's target growth
markets and with complementary customers;
- Increased international reach, particularly into North America;
- Successful performance track record with proven management; and
- High levels of profitability and cash generation, which will
further strengthen the Group's financial profile.
The Group has successfully completed 14 acquisitions in the
D&M division since 2011, which have contributed to growth in
revenues in the division from GBP15m in FY13 to GBP266m in FY19,
with Group underlying operating margins increasing from 3.1% to
7.0% in the same period. The Group's operating model is well
established and has facilitated the smooth integration of acquired
businesses, including both Hobart and Positek which joined
discoverIE in April 2019. The strategy is focussed on acquiring
high quality, niche electronics businesses with differentiated
capability which is enhancing to the Group's overall offering to
customers in its target markets of transportation, medical,
industrial & connectivity and renewable energy. Through a
combination of investment in efficiency and leveraging of the
broader Group's commercial infrastructure, the businesses acquired
since 2011 delivered an average return on investment(3) of 20% in
FY19.
Information on Sens-Tech
Sens-Tech, which is 100% owned by ETA Properties Limited, was
founded in 1994 following a management buy-out from Thorn EMI, and
acquired by current management through a subsequent buyout in 2010.
It is located in Egham in the UK and has a strong and experienced
management team. The business designs, manufactures and supplies
specialist x-ray detection and data acquisition sub-assemblies and
photo-detector modules for imaging systems. These systems are
typically used in industries that have high regulatory and
certification requirements, such as medical imaging, safety and
security applications, which leads to long product life cycles and
high barriers to entry. Sens-Tech sells worldwide, largely directly
to OEM customers, with approximately 51% of revenues generated from
customers in North America, 29% from Europe, 17% from Asia with the
balancing 3% from UK and rest of world. It will operate within the
D&M division while retaining its distinct brand identity.
Revenues for the year ended 31 March 2018 were GBP15.0m,
generating an underlying EBIT of GBP5.3m, an underlying margin of
35% and a reported pre-tax profit of GBP4.4m. At 31 March 2018,
gross assets of Sens-Tech were GBP13.9m.
Sens-Tech markets
The X-ray detector market is considered to have strong future
growth prospects, being principally driven by the increasing
adoption of digital imaging in the medical, security, food safety
and industrial markets. The growth in global air traffic and public
transportation is driving the requirement for increased
transportation security, whilst increasing preventative screening
is driving growth in medical markets and increasing screening and
test requirements are driving growth in food safety and industrial
markets.
In addition, Sens-Tech is exploring further growth opportunities
through developments in medical diagnostics, computerised
tomography (CT) security screening, plastic detection and
industrial inspection and measurement.
Details of the Placing
The Company intends to raise approximately GBP33m (before
expenses of approximately GBP1m) pursuant to the Placing. The price
per Placing Share is 415 pence.
The Placing will be conducted by Peel Hunt in accordance with
the terms and conditions set out in the Appendix to this
Announcement. The Bookbuild will determine demand for and
participation in the Placing. The Bookbuild will commence with
immediate effect following this Announcement and is expected to
close later today.
The timing of the close of the Bookbuild is at the absolute
discretion of Peel Hunt in consultation with the Company and Peel
Hunt reserves the right to close the Bookbuild process earlier or
later without further notice. The allocations will be determined by
Peel Hunt in its absolute discretion following consultation with
the Company and will be confirmed orally by Peel Hunt following the
close of the bookbuilding process. A further announcement will then
be made as soon as practicable following the completion of the
Bookbuild.
The Placing is being fully underwritten by Peel Hunt subject to
certain conditions.
The Placing is conditional, inter alia, upon:
-- the Company having complied with its material obligations
under the placing agreement which has been entered into between the
Company and Peel Hunt (the "Placing Agreement") to the extent that
such obligations are required to be performed on or prior to
Admission;
-- the delivery to the Company of certain customary documentation;
-- the publication of the results of the Placing via a
regulatory information service by no later than 17 October 2019 (or
such later time and/or date as the Company and Peel Hunt may
agree); and
-- Admission of the Placing Shares taking place by no later than
8.00 am on 21 October 2019 (or such later time and/or date as the
Company and Peel Hunt may agree).
If any of the conditions are not satisfied or waived, the
Placing Shares will not be issued and all monies received from
participants in the Placing ("Placees") will be returned to them
(at the Placees' risk and without interest) as soon as
possible.
The Placing Agreement contains customary warranties given by the
Company to Peel Hunt as to matters relating to the Company and its
business and a customary indemnity from the Company to Peel Hunt in
respect of liabilities arising out of or in connection with the
Placing. The Placing Agreement also contains customary rights of
termination which could enable Peel Hunt to terminate the Placing
prior to Admission in certain limited circumstances. Further
information on the Placing Agreement is set out in the Appendix to
this Announcement.
The Placing Shares will represent approximately 9.96% of the
existing issued share capital and will, when issued, be credited as
fully paid and will rank pari passu in all respects with the
Company's existing ordinary shares including the right to receive
all dividends and other distributions declared, made or paid in
respect of such shares after the date of issue of the Placing
Shares.
Application has been made for the Placing Shares to be admitted
to the premium segment of the Official List of the UK Financial
Conduct Authority ("FCA") and to trading on the main market for
listed securities of the London Stock Exchange plc (together, the
"Admission"). It is expected that Admission will become effective
and that dealings in the Placing Shares will commence on or around
21 October 2019 (but may be extended by agreement between the
Company and Peel Hunt).
As part of the Placing, certain of the Directors are themselves
intending to subscribe for Placing Shares at the Placing Price. If
Directors do participate, we anticipate that these related party
transactions would constitute exempt small transactions pursuant to
paragraph 1 of Annex 1 to Chapter 11 of the Listing Rules.
The terms and conditions of the Placing are set out in the
Appendix to this Announcement.
Notes
1. Underlying EBIT excludes shareholder and associated
costs.
2. FY13 means the financial year ended 31 March 2013 and FY19
means the financial year ended 31 March 2019.
3. Return on investment is defined as underlying operating
profit attributable to the acquired businesses (that have been
owned for more than 2 years) over total acquisition costs
comprising up-front consideration, acquisition expenses, earn-out
(once earned), and integration costs.
IMPORTANT NOTICE
This Announcement, and the information contained herein is not
for release, publication or distribution, directly or indirectly,
in whole or in part, in or into or from any of the Restricted
Jurisdictions. The Placing Shares have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "Securities Act") or under the securities laws of any
state or other jurisdiction of the United States and may not be
offered, sold, resold or delivered, directly or indirectly, in or
into the United States absent registration under the Securities Act
except pursuant to an exemption from or in a transaction not
subject to the registration requirements of the Securities Act. No
public offering of the Placing Shares is being made in the United
States. The Placing Shares are being offered and sold (i) outside
the United States in "offshore transactions", as defined in, and in
compliance with, Regulation S under the Securities Act and (ii)
within the United States to persons reasonably believed to be
qualified institutional buyers ("QIBs") as defined in, and in
reliance on, Rule 144A under the Securities Act. Persons receiving
this Announcement (including custodians, nominees and trustees)
must not forward, distribute, mail or otherwise transmit it in or
into the United States or use the United States mails, directly or
indirectly, in connection with the Placing. This Announcement does
not constitute or form part of an offer to sell or issue or a
solicitation of an offer to buy, subscribe for or otherwise acquire
any securities in any jurisdiction including, without limitation,
the Restricted Jurisdictions or any other jurisdiction in which
such offer or solicitation would be unlawful. This Announcement and
the information contained in it is not for publication or
distribution, directly or indirectly, to persons in a Restricted
Jurisdiction unless permitted pursuant to an exemption under the
relevant local law or regulation in any such jurisdiction.
No action has been taken by the Company, Peel Hunt or any of
their respective directors, officers, partners, agents, employees,
affiliates, advisors, consultants, persons connected with them as
defined in FSMA (as defined below) (together, "Affiliates") that
would permit an offer of the Placing Shares or possession or
distribution of this Announcement or any other publicity material
relating to such Placing Shares in any jurisdiction where action
for that purpose is required. Persons receiving this Announcement
are required to inform themselves about and to observe any
restrictions contained in this Announcement.
This Announcement is directed at and is only being distributed
to: (A) persons in member states of the European Economic Area who
are "qualified investors", as defined in article 2(e) of the
Prospectus Regulation (Regulation (EU) 2017/1129) (the "Prospectus
Regulation"), (B) if in the United Kingdom, persons who (i) have
professional experience in matters relating to investments who fall
within the definition of "investment professionals" in article
19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005, as amended (the "FPO") or fall within the
definition of "high net worth companies, unincorporated
associations etc" in article 49(2)(a) to (d) of the FPO and (ii)
are "qualified investors" as defined in section 86 of the Financial
Services and Markets Act 2000, as amended ("FSMA") or (C) persons
to whom it may otherwise lawfully be communicated (each, a
"Relevant Person"). No other person should act on or rely on this
Announcement and persons distributing this Announcement must
satisfy themselves that it is lawful to do so. By accepting the
terms of this Announcement, you represent and agree that you are a
Relevant Person. This Announcement must not be acted on or relied
on by persons who are not Relevant Persons. Any investment or
investment activity to which this Announcement or the Placing
relate is available only to Relevant Persons and will be engaged in
only with Relevant Persons. As regards all persons other than
Relevant Persons, the details of the Placing set out in this
Announcement are for information purposes only.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of this Announcement should seek appropriate advice before taking
any action.
This Announcement is not being distributed by, nor has it been
approved for the purposes of section 21 of FSMA by, a person
authorised under FSMA. This Announcement is being distributed and
communicated to persons in the United Kingdom only in circumstances
in which section 21(1) of FSMA does not apply.
No prospectus will be made available in connection with the
matters contained in this Announcement and no such prospectus is
required (in accordance with the Prospectus Regulation) to be
published.
The information contained in this Announcement is for background
purposes only and does not purport to be full or complete. No
reliance may be placed for any purpose on the information contained
in this Announcement or its accuracy, fairness or completeness.
None of the information in this Announcement has been independently
verified or approved by Peel Hunt or any of its Affiliates.
Certain statements in this Announcement are forward-looking
statements, which include all statements other than statements of
historical fact and which are based on the Company's expectations,
intentions and projections regarding its future performance,
anticipated events or trends and other matters that are not
historical facts. These forward-looking statements, which may use
words such as "aim", "anticipate", "believe", "could", "intend",
"estimate", "expect" and words of similar meaning, include all
matters that are not historical facts. These forward-looking
statements involve risks, assumptions and uncertainties that could
cause the actual results of operations, financial condition,
liquidity and dividend policy and the development of the industries
in which the Company's businesses operate to differ materially from
the impression created by the forward-looking statements. These
statements are not guarantees of future performance and are subject
to known and unknown risks, uncertainties and other factors that
could cause actual results to differ materially from those
expressed or implied by such forward-looking statements. Given
those risks and uncertainties, prospective investors are cautioned
not to place undue reliance on forward-looking statements.
Forward-looking statements speak only as of the date of such
statements and, except as required by the FCA, the London Stock
Exchange or applicable law, the Company, Peel Hunt and their
respective Affiliates undertakes no obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.
Any indication in this Announcement of the price at which the
Company's shares have been bought or sold in the past cannot be
relied upon as a guide to future performance. Persons needing
advice should consult an independent financial adviser. No
statement in this Announcement is intended to be a profit forecast
and no statement in this Announcement should be interpreted to mean
that earnings per share of the Company for the current or future
financial years would necessarily match or exceed the historical
published earnings per share of the Company.
Peel Hunt, which is authorised and regulated in the United
Kingdom by the FCA, is acting exclusively for the Company and for
no one else in connection with the Placing and will not be
responsible to anyone other than the Company for providing the
protections afforded to its clients for providing advice in
relation to the Placing, or any other matters referred to in this
Announcement.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by or on behalf of the Company, Peel Hunt or
by their respective Affiliates as to, or in relation to, the
accuracy or completeness of this Announcement or any other written
or oral information made available to or publicly available to any
interested party or its advisers, and any liability therefor is
expressly disclaimed.
Recipients of this Announcement should conduct their own
investigation, evaluation and analysis of the business, data and
property described in this Announcement. This Announcement does not
constitute a recommendation concerning any investor's options with
respect to the Placing. The price and value of securities can go
down as well as up. Past performance is not a guide to future
performance. The contents of this Announcement are not to be
construed as legal, business, financial or tax advice. Each
shareholder or prospective investor should consult with his or her
or its own legal adviser, business adviser, financial adviser or
tax adviser for legal, financial, business or tax advice.
The Placing Shares to be issued pursuant to the Placing will not
be admitted to trading on any stock exchange other than the London
Stock Exchange's main market for listed securities.
The Appendix to this Announcement sets out the terms and
conditions of the Placing. By participating in the Placing, each
Placee will be deemed to have read and understood this Announcement
in its entirety and to be making such offer to acquire Placing
Shares on the terms and subject to the conditions set out in this
Announcement and to be providing the representations, warranties,
undertakings and acknowledgements contained in the Appendix.
Members of the public are not eligible to take part in the
Placing and no public offering of Placing Shares is being or will
be made.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this Announcement.
APPIX
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES
ONLY.
THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION,
RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN
PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR
SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION,
RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL ("RESTRICTED
JURISDICTIONS").
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING AND NO PUBLIC OFFERING OF PLACING SHARES IS BEING OR WILL
BE MADE. THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT AND
REFERRED TO IN IT ARE DIRECTED ONLY AT PERSONS SELECTED BY PEEL
HUNT WHO ARE (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC
AREA WHO ARE "QUALIFIED INVESTORS" FALLING WITHIN THE MEANING OF
ARTICLE (2)(E) OF THE PROSPECTUS REGULATION; (B) IF IN THE UNITED
KINGDOM, TO PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS
RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE
FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER
2001 (the "FPO") AND WHO FALL WITHIN THE DEFINITION OF "INVESTMENT
PROFESSIONALS" IN ARTICLE 19(5) OF THE FPO OR FALL WITHIN THE
DEFINITION OF "HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS ETC" IN ARTICLE 49(2)(A) TO (D) OF THE FPO AND (II)
ARE "QUALIFIED INVESTORS" AS DEFINED IN SECTION 86 OF FSMA OR (C)
PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH
PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS
ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT
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 ANNOUNCEMENT RELATES IS
AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH
RELEVANT PERSONS. EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS
AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN
PLACING SHARES. DISTRIBUTION OF THIS ANNOUNCEMENT IN CERTAIN
JURISDICTIONS MAY BE RESTRICTED OR PROHIBITED BY LAW. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by or on behalf of the Company, Peel Hunt,
or by their respective Affiliates as to, or in relation to, the
accuracy or completeness of this Announcement or any other written
or oral information made available to or publicly available to any
interested party or its advisers, and any liability therefor is
expressly disclaimed.
The Placing Shares have not been and will not be registered
under the Securities Act or under the securities laws of any state
or other jurisdiction of the United States and may not be offered,
sold, resold, transferred or delivered, directly or indirectly, in
or into the United States absent registration under the Securities
Act except pursuant to an exemption from or in a transaction not
subject to the registration requirements of the Securities Act. No
public offering of the Placing Shares is being made in the United
States. The Placing Shares are being offered and sold (i) outside
the United States in "offshore transactions", as defined in, and in
compliance with, Regulation S under the Securities Act and (ii)
within the United States to persons reasonably believed to be
qualified institutional buyers ("QIBs") as defined in, and in
reliance on, Rule 144A under the Securities Act. Persons receiving
this Announcement (including custodians, nominees and trustees)
must not forward, distribute, mail or otherwise transmit it or any
part of it in or into the United States or use the United States
mails, directly or indirectly, in connection with the Placing.
This Announcement does not constitute or form part of an offer
to sell or issue or a solicitation of an offer or invitation to buy
or subscribe for or otherwise acquire any securities in any
jurisdiction including, without limitation, the Restricted
Jurisdictions or any other jurisdiction in which such offer or
solicitation is or may be unlawful. No copy or part of this
Announcement and the information contained in it may be published
or distributed, directly or indirectly, to persons in a Restricted
Jurisdiction unless permitted pursuant to an exemption under the
relevant local law or regulation in any such jurisdiction.
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 Australia, Canada, Japan or 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 Australia, Canada,
Japan or South Africa or any other jurisdiction outside the United
Kingdom.
No action has been taken by the Company, Peel Hunt, or any of
their respective Affiliates that would permit an offer of the
Placing Shares or possession or distribution of this Announcement
or any other publicity material relating to such Placing Shares in
any jurisdiction where action for that purpose is required. Persons
receiving this Announcement are required to inform themselves about
and to observe any restrictions contained in this Announcement.
Persons distributing any part of this Announcement must satisfy
themselves that it is lawful to do so. Persons (including, without
limitation, nominees and trustees) who have a contractual or other
legal obligation to forward a copy of this Announcement should seek
appropriate advice before taking any action. Persons into whose
possession this Announcement comes are required by the Company and
Peel Hunt to inform themselves about, and observe, any such
restrictions.
Any indication in this Announcement of the price at which the
Company's shares have been bought or sold in the past cannot be
relied upon as a guide to future performance. Persons needing
advice should consult an independent financial adviser. No
statement in this Announcement is intended to be a profit forecast
and no statement in this Announcement should be interpreted to mean
that earnings per share of the Company for the current or future
financial years would necessarily match or exceed the historical
published earnings per share of the Company.
Peel Hunt, which is authorised and regulated in the United
Kingdom by the FCA, is acting exclusively for the Company and for
no one else in connection with the Placing and will not be
responsible to anyone other than the Company for providing the
protections afforded to clients of Peel Hunt (as applicable) or for
providing advice in relation to the Placing, or any other matters
referred to in this Announcement.
By participating in the Placing, each Placee is deemed to have
read and understood this Announcement in its entirety and to be
making such offer to acquire Placing Shares on the terms and
subject to the conditions set out in this Announcement and to be
providing the representations, warranties, undertakings, agreements
and acknowledgements contained in this Appendix.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF AN ACQUISITION OF
PLACING SHARES.
Details of the Placing Agreement and the Placing Shares
The Company has today entered into the Placing Agreement with
Peel Hunt. Pursuant to the Placing Agreement, Peel Hunt has,
subject to the terms set out in such agreement, agreed to use
reasonable endeavours, as agents of the Company, to procure Placees
for the Placing Shares. Peel Hunt will today commence the Bookbuild
to determine demand for participation in the Placing by Placees.
This Appendix gives details of the terms and conditions of, and the
mechanics for participation in, the Placing. The Placing is fully
underwritten by Peel Hunt.
The Placing Shares will, when issued, be subject to the articles
of association of the Company, be credited as fully paid and rank
pari passu in all respects with each other and with the existing
ordinary shares in the capital of the Company (the "Ordinary
Shares"), including the right to receive all dividends and other
distributions declared, made or paid in respect of the Ordinary
Shares after the date of issue of the Placing Shares.
The Placing Shares will be issued free of any encumbrance, lien
or other security interest.
Application for Admission
Application will be made to the FCA for admission of the Placing
Shares to the premium segment of the Official List of the UK
Listing Authority and to London Stock Exchange plc for admission to
trading of the Placing Shares on its main market for listed
securities ("Admission"). Admission is expected to become effective
on or around 21 October 2019 (or such later time/date as Peel Hunt
may agree with the Company) and dealings in the Placing Shares will
commence on the same day.
Principal terms of the Placing
1 Peel Hunt is acting as sole bookrunner, broker and agent of
the Company in connection with the Placing on the terms and subject
to the conditions of the Placing Agreement.
2 Participation in the Bookbuild will only be available to
persons who may lawfully be, and are, invited by Peel Hunt to
participate. Peel Hunt and any of its Affiliates are entitled to
enter bids in the Bookbuild as principal.
3 The price per Placing Share (the "Placing Price") is a price
of 415 pence and is payable to Peel Hunt (as agent for the Company)
by all Placees. No commissions will be paid to Placees or by the
Placees in respect of any Placing Shares.
4 The completion of the Bookbuild will be determined by Peel
Hunt in its absolute discretion following consultation with the
Company and the results of the Placing shall then be announced on a
Regulatory Information Service as soon as is practicable following
completion of the Bookbuild.
5 To bid in the Bookbuild, prospective Placees should
communicate their bid by telephone to their usual sales contact at
Peel Hunt. Each bid should state the number of Placing Shares which
the prospective Placee wishes to subscribe for.
6 The Bookbuild is expected to close later today but may be
closed earlier or later at the absolute discretion of Peel Hunt in
consultation with the Company. Peel Hunt may, in agreement with the
Company, accept bids either in whole or in part that are received
after the Bookbuild has closed and allocate Placing Shares after
the time of any initial allocation to any person submitting a bid
after time.
7 Each prospective Placee's allocation will be determined by
Peel Hunt in its absolute discretion following consultation with
the Company and will be confirmed orally by Peel Hunt to such
Placees, and a trade confirmation will be dispatched as soon as
practicable thereafter and the terms and conditions of this
Appendix will be deemed incorporated into the trade
confirmation.
8 Peel Hunt's oral and/or written confirmation to any person of
an allocation of Placing Shares will give rise to an immediate,
separate, irrevocable and legally binding commitment by that
person, in favour of Peel Hunt and the Company, under which it
agrees and is obligated to (i) acquire the number of Placing Shares
allocated to it and (ii) pay Peel Hunt (or as it may direct) in
cleared funds an amount equal to the product of the Placing Price
and the number of Placing Shares allocated to it and that the
Company has agreed to allot and issue to that Placee, on the terms
and subject to the conditions set out in this Appendix and in
accordance with the Company's articles of association. Except with
Peel Hunt's consent, such commitment will not be capable of
variation or revocation after the time at which it is submitted.
The Company will make a further Announcement following the close of
the Bookbuild detailing the number of Placing Shares for which
Placees have been procured. Each Placee's obligation will be owed
to the Company and to Peel Hunt.
9 Subject to paragraphs 4 and 5 above, Peel Hunt may choose to
accept bids, either in whole or in part, on the basis of
allocations determined at its discretion and may scale down any
bids for this purpose on such basis as it may determine.
10 The Company reserves the right (upon agreement with Peel
Hunt) to reduce or seek to increase the amount to be raised
pursuant to the Placing.
11 Each Placee's allocation and commitment to subscribe for
Placing Shares will be made on the terms and subject to the
conditions in this Appendix and will be legally binding on the
Placee on behalf of which it is made and except with Peel Hunt's
consent will not be capable of variation or revocation after the
time at which it is submitted.
12 Except as required by law or regulation, no press release or
other announcement will be made by Peel Hunt 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.
13 Irrespective of the time at which the Placee's allocation(s)
pursuant to the Placing is/are 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".
14 All obligations under the Placing will be subject to
fulfilment (or where applicable, waiver) of the conditions referred
to below under "Conditions of the Placing" and to the Placing not
being terminated on the basis referred to below under "Rights to
terminate under the Placing Agreement".
15 By participating in the Bookbuild, 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.
16 To the fullest extent permissible by law and applicable FCA
rules, neither Peel Hunt nor any of its Affiliates shall have any
liability (including to the extent permissible by law, any
fiduciary duties) to Placees or to any other person other than the
Company whether acting on behalf of a Placee or otherwise. In
particular neither Peel Hunt nor any of its Affiliates shall have
any liability (including, to the extent permissible by law, any
fiduciary duties) in respect of its conduct of the Placing or of
such alternative method of effecting the Placing as Peel Hunt and
the Company may agree.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming
unconditional and not having been terminated in accordance with its
terms.
The obligations of Peel Hunt under the Placing Agreement are
conditional, inter alia, on the following "Conditions":
1 the Company having complied with its material obligations
under the Placing Agreement to the extent that such obligations are
required to be performed prior to Admission;
2 the delivery to the Company of certain customary documentation;
3 the publication of the results of the Placing via a regulation
information service by no later than 17 October 2019 (or such later
time and/or date as the Company and Peel Hunt may agree); and
4 Admission having become effective at or before 8.00 am on 21
October 2019 (or such later time or date as the Company and Peel
Hunt may agree).
If (a) any of the conditions are not fulfilled (or to the extent
permitted under the Placing Agreement waived by Peel Hunt) by the
relevant time or date specified in the Placing Agreement (or such
later time or date as the Company and Peel Hunt may agree), or (b)
the Placing Agreement is terminated in the circumstances specified
below, the Placing will lapse and each Placee's rights and
obligations hereunder shall cease and terminate at such time and no
claim may be made by a Placee in respect thereof. Neither the
Company, nor Peel Hunt nor any of their respective Affiliates shall
have any liability to any Placees (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 in the
Placing Agreement 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 the Company and/or
Peel Hunt.
Peel Hunt may waive 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. Any such extension or waiver
will not affect Placees' commitments as set out in this
Announcement.
By participating in the Placing, each Placee agrees that its
rights and obligations hereunder terminate only in the
circumstances described below under "Rights to terminate under the
Placing Agreement" and will not be capable of rescission or
termination by the Placee.
Rights to terminate under the Placing Agreement
Peel Hunt may at any time before Admission, terminate its
obligations under the Placing Agreement by giving notice to the
Company if, inter alia, Peel Hunt becomes aware that:
1 any statement of fact contained in this Announcement, or
certain of the other documents delivered in relation to the
Placing, has been discovered to be untrue, incorrect or misleading
in any respect which Peel Hunt considers, acting in good faith, to
be materially adverse in the context of the Placing; or
2 there has been a breach of any of the warranties or any other
obligation of the Company under the Placing Agreement which Peel
Hunt considers, acting in good faith, to be materially adverse in
the context of the Placing; or
3 an event has occurred or a matter has arisen on or before the
date of the Placing Agreement and before Admission which if it had
occurred or arisen before the date of the Placing Agreement would
have rendered any of the warranties untrue or incorrect, which Peel
Hunt considers, acting in good faith, to be materially adverse in
the context of the Placing: or
4 there has been a breach of any provision of the agreement
pursuant to which the Acquisition described in the announcement
will take place (the "Acquisition Agreement") by any vendor party
to it which, Peel Hunt acting in good faith, considers to be
material in the context of the Placing or, in the opinion of Peel
Hunt acting in good faith, any event has occurred or matter has
arisen after entry into the Acquisition Agreement which had it
occurred or arisen prior to entry into the Acquisition Agreement
would have been such a breach; or
5 any of the conditions in the Placing Agreement shall have
become incapable of fulfilment before the latest time provided in
the Placing Agreement and has not been waived by Peel Hunt
according to the terms of the Placing Agreement; or
6 there has been (a) a suspension or material limitation of (i)
trading of any securities of the Company on the London Stock
Exchange or on any exchange or over-the-counter market; (ii)
trading generally on the London Stock Exchange, the New York Stock
Exchange or the Nasdaq Stock Market, or any over-the-counter
market; (iii) a fixing of minimum and maximum prices for trading,
or the imposition of a requirement for maximum ranges for prices by
any of the said exchanges or by such system or by order of any
government authority; or (iii) a material disruption in commercial
banking or securities settlement or clearance services in the
United States or the United Kingdom; (b) a general moratorium on
commercial banking activities in London declared by the relevant
authorities; (c) any declaration, outbreak, escalation, or
threatening of war or other hostilities or the occurrence of any
acts of terrorism involving the UK or the USA or the declaration by
either of a national emergency; (d) a material change in taxation
materially adversely affecting the Group taken as a whole or its
prospects or the Placing; (e) any other occurrence of any kind
which (by itself or together with any other such occurrence) in the
opinion of Peel Hunt acting in good faith, is likely to materially
and adversely affect the market's perception of the Company or the
financial position or trading position or prospects of the Group
taken as a whole; (f) any other crisis of international or national
effect or any change in any financial, political, economic or
market conditions or in market sentiment or any other calamity or
crisis which, in any case, in the opinion of Peel Hunt acting in
good faith, is materially adverse to the Placing, and which in the
case of (a)-(f), Peel Hunt considers, acting in good faith, makes
it impracticable or inadvisable to proceed with the Placing.
Upon termination, the Company and Peel Hunt shall be released
and discharged (except for any liability arising before or in
relation to such termination) from their respective obligations
under or pursuant to the Placing Agreement, subject to certain
exceptions.
By participating in the Placing, each Placee agrees that the
exercise by Peel Hunt of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Peel Hunt (acting in good faith where required) and
that Peel Hunt will not need to make any reference to the Placees
in this regard and that to the fullest extent permitted by law Peel
Hunt and the Company (or the Company's directors, officers or
employees) shall not have any liability whatsoever to the Placees
in connection with any such exercise.
No prospectus
No offering document or prospectus has been or will be prepared,
submitted or approved by the FCA in relation to the Placing and no
such prospectus is required to be published and Placees'
commitments will be made solely on the basis of the information
contained in this Announcement and any information previously
published by or on behalf of the Company by notification to a
Regulatory Information Service and subject to the further terms set
forth in the trade confirmation to be provided to individual
prospective Placees.
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 to Peel Hunt and the
Company that it has neither received nor relied on any information,
representation, warranty or statement made by or on behalf of Peel
Hunt (other than the amount of the relevant Placing participation
in the oral and/or written confirmation given to Placees and the
trade confirmation referred to above) or any of its Affiliates, any
persons acting on its behalf or the Company and neither Peel Hunt
nor any of its Affiliates, any persons acting on its behalf, nor
the Company will be liable for the decision of any Placee to
participate in the Placing based on any other information,
representation, warranty or statement which the Placee may have
obtained or received (regardless of whether or not such
information, representation, warranty or statement was given or
made by or on behalf of any such persons).
By participating in the Placing, each Placee acknowledges to,
and agrees with Peel Hunt, for itself and as agent for the Company
that, except in relation to the information obtained in this
Announcement, it has relied on its own investigation of the
business, financial or other position of the Company in deciding to
participate in the Placing. 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:GB0000055888) following Admission will take place within the
CREST system, subject to certain exceptions. Peel Hunt reserves the
right to require settlement for and delivery of the Placing Shares
to Placees by such other means that they deem necessary, if
delivery or settlement is not possible or practicable within the
CREST system within the timetable set out in this Announcement or
would not be consistent with the regulatory requirements in the
Placee's jurisdiction.
Each Placee allocated Placing Shares in the Placing will be sent
a trade confirmation in accordance with the standing arrangements
in place with Peel Hunt stating the number of Placing Shares
allocated to it, the Placing Price, the aggregate amount owed by
such Placee to Peel Hunt 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 standing
CREST or certificated settlement instructions that it has in place
with Peel Hunt.
A Placee's entitlement to receive any Placing Shares under the
Placing will be conditional on Peel Hunt's receipt of payment in
full for such Placing Shares by the relevant time to be stated in
the written confirmation referred to above, or by such later time
and date as Peel Hunt and the Company may in their absolute
discretion determine, or otherwise in accordance with that
confirmation's terms.
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 the base rate of
Barclays Bank Plc.
Each Placee is deemed to agree that if it does not comply with
these obligations: (i) the Company may release itself (if it
decides in its absolute discretion to do so) and will be released
from all obligations it may have to issue any such Placing Shares
to such Placee or at its direction which are then unissued; (ii)
the Company may exercise all rights of lien, forfeiture and set-off
over and in respect of any Placing Shares to the fullest extent
permitted under its articles of association or otherwise by law and
to the extent that such Placee then has any interest in or rights
in respect of any Placing Shares; (iii) the Company or Peel Hunt
may sell (and both of them is irrevocably authorised by such Placee
to do so) all or any Placing Shares on such Placee's behalf and
then retain from the proceeds, for the account and benefit of the
Company or, where applicable, Peel Hunt (a) any amount up to the
total amount due to it as, or in respect of, subscription monies,
or as interest on such monies, for any Placing Shares, (b) any
amount required to cover any stamp duty or stamp duty reserve tax
(together with any interest or penalties) arising on the sale of
such Placing Shares on such Placee's behalf, and (c) any amount
required to cover dealing costs and/or commissions necessarily or
reasonably incurred by it in respect of such sale; and (iv) such
Placee shall remain liable to the Company (and to Peel Hunt as
applicable) for the full amount of any losses or shortfall and of
any costs which it may suffer or incur as a result of it (a) not
receiving payment in full for such Placing Shares by the required
time, and/or (b) the sale of any such Placing Shares to any other
person at whatever price and on whatever terms actually obtained
for such sale by or for it. By communicating a bid for Placing
Shares, each Placee confers on Peel Hunt all such authorities and
powers necessary to carry out any such sale under this paragraph
and agrees to ratify and confirm all actions which Peel Hunt
lawfully takes in pursuance of such sale.
If Placing Shares are to be delivered to a custodian or
settlement agent, the Placee should ensure that the trade
confirmation is copied and delivered immediately to the relevant
person within that organisation.
Insofar as Placing Shares are registered in the Placee's name or
that of its nominee or in the name of any person for whom the
Placee is contracting as agent or that of a nominee for such
person, such Placing Shares will, subject as provided below, be so
registered free from any liability to stamp duty or stamp duty
reserve tax. If there are any circumstances in which any other
stamp duty or stamp duty reserve tax is payable in respect of the
issue of the Placing Shares, neither Peel Hunt nor the Company
shall be responsible for the payment thereof. Placees will not be
entitled to receive any fee or commission in connection with the
Placing.
Representations and Warranties
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf):
1 represents and warrants that it has read and understood this
Announcement in its entirety (including this Appendix) and
acknowledges that its participation in the Placing will be governed
by the terms and conditions of the Placing as referred to and
included in this Announcement (including this Appendix);
2 acknowledges that no prospectus or offering document has been
or will be prepared in connection with the Placing and that it has
not received and will not receive a prospectus or other offering
document in connection with the Placing or the Placing Shares;
3 acknowledges that the ordinary shares in the capital of the
Company are listed on the Official List of the FCA and are admitted
to trading on the London Stock Exchange, and the Company is
therefore required to publish certain business and financial
information in accordance with the rules and practices of the
London Stock Exchange and/or the FCA (collectively "Exchange
Information"), which includes a description of the nature of the
Company's business and the Company's most recent balance sheet and
profit and loss account and that it is able to obtain or access
such information or comparable information concerning any other
publicly traded company without undue difficulty;
4 represents and warrants that it has made its own assessment of
the Company, the Placing Shares and the terms and conditions of the
Placing and has relied on its own investigation of the business,
financial or other position of the Company in accepting a
participation in the Placing and has satisfied itself that the
information is still current;
5 agrees to indemnify on an after-tax basis and hold harmless
each of the Company, Peel Hunt, their Affiliates and any person
acting on their behalf from any and all costs, claims, liabilities
and expenses (including legal fees and expenses) arising out of or
in connection with any breach by it of the representations,
warranties, acknowledgements, agreements and undertakings in this
Announcement including this Appendix and further agrees that the
provisions of this Announcement including this Appendix shall
survive after completion of the Placing;
6 acknowledges that neither Peel Hunt nor any of its Affiliates
nor any person acting on its behalf has provided, and will not
provide it with, any material or information regarding the Placing
Shares or the Company; nor has it requested that Peel Hunt nor any
of its Affiliates nor any person acting on its behalf to provide it
with any such material or information;
7 acknowledges that the content of this Announcement is
exclusively the responsibility of the Company and that neither Peel
Hunt nor any of its Affiliates nor any person acting on its behalf
will be responsible for or shall have any liability for any
information, representation or statement relating to the Company
contained in this Announcement or any information previously
published by or on behalf of the Company and neither Peel Hunt nor
any of its Affiliates nor any person acting on its behalf will be
liable for any Placee's decision to participate in the Placing
based on any information, representation or statement contained in
this Announcement 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
to subscribe for Placing Shares is the information contained in
this Announcement and any Exchange Information, such information
being all that it deems necessary to make an investment decision in
respect of the Placing Shares and that it has relied on its own
investigation with respect to the Placing Shares and the Company in
connection with its decision to subscribe for Placing Shares and
acknowledges that it is not relying on any investigation that Peel
Hunt, any of its Affiliates or any person acting on its behalf may
have conducted with respect to the Placing Shares or the Company
and none of such persons has made any representations to it,
express or implied, with respect thereto;
8 represents and warrants that it has knowledge and experience
in financial, business and international investment matters as is
required to evaluate the merits and risks of subscribing for
Placing Shares. It further represents and warrants that it is
experienced in investing in securities of this nature and is aware
that it may be required to bear, and is able to bear, the economic
risk of, and is able to sustain, a complete loss in connection with
the Placing. It also represents and warrants that it has had
sufficient time to consider and has conducted its own investigation
with respect to the offer and subscription for Placing Shares,
including the tax, legal and other economic considerations, and has
relied upon its own examination and due diligence of the Company
and its affiliates taken as a whole, and the terms of the Placing,
including the merits and risks involved;
9 represents and warrants that it has not relied on any
confidential price sensitive information concerning the Company in
making its investment decision to participate in the Placing and is
not purchasing the Placing Shares on the basis of material
non-public information or inside information (as defined under the
Market Abuse Regulation (EU 596/2014) ("MAR");
10 represents and warrants that it has the funds available to
pay for the Placing Shares it has agreed to subscribe for and
acknowledges, agrees and undertakes that it will pay the total
subscription amount in accordance with the terms of this
Announcement on the due time and date set out herein, failing which
the relevant Placing Shares may be placed with other placees or
sold at such price as Peel Hunt determines;
11 acknowledges that it has not relied on any information
relating to the Company contained in any research reports prepared
by Peel Hunt, its Affiliates or any person acting on its, or any of
its Affiliates behalf and understands that (i) neither Peel Hunt
nor any of its Affiliates nor any person acting on its behalf has
or shall have any liability for public information or any
representation; (ii) neither Peel Hunt nor any of its Affiliates,
nor any person acting on its behalf, has or shall have any
liability for any additional information that has otherwise been
made available to such Placee, whether at the date of this
Announcement or otherwise; and (iii) neither Peel Hunt nor any of
its Affiliates, nor any person acting on its behalf, makes any
representation or warranty, express or implied, as to the truth,
accuracy or completeness of such information, whether at the date
of this Announcement or otherwise;
12 represents and warrants that (i) it is entitled to acquire
Placing Shares under the laws and regulations of all relevant
jurisdictions which apply to it; (ii) it has fully observed such
laws and regulations and obtained all such governmental and other
guarantees and other consents and authorities (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 Announcement including this Appendix)
which may be required thereunder and has complied with all
necessary formalities; (iii) it has all necessary capacity and
authority and is entitled to commit to participation in the Placing
and to perform its obligations in relation thereto and will honour
such obligations, and to make the representations and agreements
contained on this Appendix; (iv) it has paid any issue, transfer or
other taxes due in connection with its participation in the Placing
in any territory; (v) it has not taken any action which will or may
result in the Company, or Peel Hunt or any of their Affiliates or
any person acting on their behalf in breach of the legal and/or
regulatory requirements of any territory in connection with the
Placing and (iv) if it is a pension fund or investment company it
is aware of and acknowledges that it is required to comply with all
applicable laws and regulations with respect to its subscription
for Placing Shares;
13 represents and warrants that (i) 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, (ii) it will not offer, sell or
deliver, directly or indirectly, any Placing Shares in or into the
United States other than pursuant to an effective registration
under the Securities Act or in a transaction exempt from, or not
subject to, the registration requirements thereunder and in
compliance with any applicable securities laws of any state or
other jurisdiction of the United States;
14 represents and warrants that (i) it is outside of the United States, not acting on a non-discretionary basis for the account or benefit of a person located within the United States at the time the undertaking to acquire the Placing Shares is given and is otherwise acquiring the Placing Shares in an "offshore transaction" meeting the requirements of Regulation S under the Securities Act or (ii) if in the United States, it is a "qualified institutional buyer" as defined in, and in reliance on, Rule 144A under the Securities Act and will duly execute a US Investor Letter and deliver the same to the bank that will be provided to it by Peel Hunt;
15 represents and warrants that it is subscribing for the
Placing Shares for investment purposes, and not with a view to
offer, resell, or distribute within the meaning of US securities
law;
16 represents and warrants that none of it, its Affiliates, or
anyone acting on its or their behalf is acquiring any of the
Placing Shares as result of any form of general solicitation or
general advertising (within the meaning of Rule 502(c) of
Regulation D under the Securities Act) or directed selling efforts
(as defined in Regulation S under the Securities Act);
17 represents and warrants that it is not, and any person who it
is acting on behalf of is not, and at the time the Placing Shares
are subscribed will not be, a resident of, or with an address in
any Restricted Jurisdiction, and it acknowledges and agrees that
the Placing Shares have not been and will not be registered or
otherwise qualified under the securities legislation of any
Restricted Jurisdiction and may not be offered, sold, or acquired,
directly or indirectly, within those jurisdictions;
18 represents and warrants that, if it is a financial
intermediary, as that term is used in Article 5(1) of the
Prospectus Regulation, 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 other
than "qualified investors" as defined in Article 2(e) of the
Prospectus Regulation, or in circumstances in which the prior
consent of Peel Hunt has been given to the offer or resale;
19 represents and warrants that it has not offered or sold and
will not offer or sell any Placing Shares to the public in the
United Kingdom or any member state of the European Economic Area
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 the United Kingdom within the
meaning of section 85(1) of FSMA or an offer to the public in any
other member state of the European Economic Area within the meaning
of the Prospectus Regulation;
20 represents and warrants that it has not been engaged to
subscribe for the Placing Shares on behalf of any other person who
is not a Qualified Investor unless the terms on which it is engaged
enable it to make decisions concerning the acceptance of offers of
transferable securities on the client's behalf without reference to
the client as described in section 86(2) of FSMA;
21 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 FSMA) relating to the
Placing Shares in circumstances in which it is permitted to do so
pursuant to section 21 of FSMA and it acknowledges and agrees that
this Announcement has not been approved by Peel Hunt in its
capacity as authorised persons under section 21 of FSMA and it may
not therefore be subject to the controls which would apply if it
was made or approved as financial promotion by an authorised
person;
22 represents and warrants that it is aware of and has complied
and will comply with all applicable provisions of FSMA with respect
to anything done by it in relation to the Placing Shares in, from,
or otherwise involving the United Kingdom;
23 represents and warrants that it is aware of and has complied
with its obligations in connection with money laundering and
terrorist financing under the Criminal Justice Act 1993, section
118 of FSMA, MAR, the Proceeds of Crime Act 2002 (as amended), the
Terrorism Act 2000, the Terrorism Act 2006, the Antiterrorism Crime
and Security Act 2001, the Money Laundering Regulations (2007) and
related or similar rules, regulations or guidelines, issued,
administered or enforced by any government agency having
jurisdiction in respect thereof (the "Regulations") and the Money
Laundering Sourcebook of the FCA and, if it is 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;
24 represents and warrants that if it is in a Member State of
the European Economic Area or the United Kingdom, it is a Relevant
Person. For such purposes, it undertakes that it will acquire,
hold, manage and (if applicable) dispose of any Placing Shares that
are allocated to it for the purposes of its business only;
25 represents and warrants that its participation in the Placing
would not give rise to an offer being required to be made by it or
any person with whom it is acting in concert pursuant to Rule 9 of
the City Code on Takeovers and Mergers;
26 undertakes that it (and any person acting on its behalf) will
pay for the Placing Shares acquired by it in accordance with this
Announcement on the due time and date set out in this Announcement
or any trade confirmation issued pursuant to this Announcement
against delivery of such Placing Shares to it, failing which the
relevant Placing Shares may be placed with other Placees or sold as
either Peel Hunt or the Company may, in their absolute discretion,
determine and it will remain liable for any shortfall of the net
proceeds of such sale below the Placing proceeds of such Placing
Shares and may be required to bear any costs, commissions, stamp
duty or stamp duty reserve tax (together with any interest or
penalties due pursuant to the terms set out or referred to in this
Announcement) which may arise upon the sale of such Placee's
Placing Shares on its behalf;
27 acknowledges that if it has received any confidential price
sensitive information (including inside information as defined
under MAR) about the Company in advance of the Placing, it warrants
that it has received such information within the market soundings
regime provided for in Article 11 of MAR and has not: (a) dealt in
the securities of the Company; (b) encouraged or required another
person to deal in the securities of the Company; or (c) disclosed
such information to any person, prior to the information being made
publicly available;
28 acknowledges that neither Peel Hunt, nor any of its
Affiliates nor any person acting on its behalf is making any
recommendations to it or advising it regarding the suitability or
merits of any transaction it may enter into in connection with the
Placing, and that neither Peel Hunt, nor any of its Affiliates nor
any person acting on its behalf has any duties or responsibilities
to it for providing advice in relation to the Placing or in respect
of any representations, warranties, undertakings or indemnities
contained in the Placing Agreement or for the exercise or
performance of any of Peel Hunt's rights and obligations
thereunder, including any right to waive or vary any condition or
exercise any termination right contained therein;
29 acknowledges that it irrevocably appoints Peel Hunt as its
agent for the purposes of executing and delivering to the Company
and/or its registrars any documents on its behalf necessary to
enable it to be registered as the holder of any of the Placing
Shares agreed to be taken up by it under the Placing;
30 represents and warrants that any person who confirms to Peel
Hunt on behalf of a Placee an agreement to subscribe for Placing
Shares and/or who authorises Peel Hunt to notify the Placee's name
to the Company's registrar, has authority to do so on behalf of the
Placee;
31 acknowledges that the agreement to settle each Placee's
allocation of Placing Shares (and/or the allocation of a person for
whom it is contracting as agent) free of stamp duty and stamp duty
reserve tax depends on the settlement relating only to an
acquisition by it and/or such person direct from the Company of the
Placing Shares in question. Such agreement assumes that the Placing
Shares are not being acquired in connection with arrangements to
issue depositary receipts or to issue or transfer the Placing
Shares into a clearance service. If there were any such
arrangements, or the settlement related to other dealing in the
Placing Shares, stamp duty or stamp duty reserve tax may be
payable, for which neither the Company nor Peel Hunt will be
responsible. If this is the case, the Placee should take its own
advice and notify Peel Hunt accordingly;
32 represents and warrants that it, or the person specified by
it for registration as a holder of the Placing Shares, 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), if
any, payable on acquisition of any of the Placing Shares or the
agreement to subscribe for the Placing Shares and acknowledges and
agrees that none of Peel Hunt, the Company, any of their respective
Affiliates or any person acting on behalf of them 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 agrees to indemnify the Company and
Peel Hunt on an after--tax basis in respect of the same, on the
basis that the Placing Shares will be allotted to the CREST stock
account of Peel Hunt who will hold them as nominee on behalf of
such Placee until settlement in accordance with its standing
settlement instructions;
33 acknowledges that the Placing Shares will be issued subject
to the terms and conditions set out in this Announcement (including
this Appendix);
34 acknowledges that in order to ensure compliance with the
Money Laundering Regulations 2007, Peel Hunt (for itself and as
agent on behalf of the Company) or the Company's registrars may, in
their absolute discretion, require verification of its identity.
Pending the provision to Peel Hunt or the Company's registrars, as
applicable, of evidence of identity, definitive certificates in
respect of the Placing Shares may be retained at Peel Hunt's
absolute discretion or, where appropriate, delivery of the Placing
Shares to it in uncertificated form, may be retained at Peel Hunt's
or the Company's registrars', as the case may be, absolute
discretion. If within a reasonable time after a request for
verification of identity, Peel Hunt (for itself and as agent on
behalf of the Company) or the Company's registrars have not
received evidence satisfactory to them, Peel Hunt and/or the
Company may, at its absolute discretion, terminate its commitment
in respect of the Placing, in which event the monies payable on
acceptance of allotment will, if already paid, be returned without
interest to the account of the drawee's bank from which they were
originally debited;
35 acknowledges that when a Placee or any person acting on
behalf of the Placee is dealing with Peel Hunt, any money held in
an account with Peel Hunt 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 relevant rules and regulations of the FCA
made under 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 Peel Hunt's
money in accordance with the client money rules and will be used by
Peel Hunt in the course of its business; and the Placee will rank
only as a general creditor of Peel Hunt;
36 acknowledges and understands that the Placing is not
conditional on completion of the Acquisition and that the
Acquisition is dependent upon certain conditions being satisfied
and that accordingly neither the Company nor Peel Hunt warrant or
represent that the Acquisition will complete;
37 acknowledges and understands that the Company, Peel Hunt and
others will rely upon the truth and accuracy of the foregoing
agreements, acknowledgements, representations, warranties,
agreements and undertakings which are given to Peel Hunt, on its
own behalf and on behalf of the Company, are irrevocable;
38 acknowledges that time is of the essence as regard its
obligations in respect of its participation in the Placing under
these terms and conditions;
39 acknowledges that the basis of allocation will be determined
by Peel Hunt in its absolute discretion in consultation with the
Company. The right is reserved to reject in whole or in part and/or
scale back any participation in the Placing;
40 irrevocably authorises the Company and Peel Hunt to produce
this Announcement pursuant to, in connection with, or as may be
required by any applicable law or regulation, administrative or
legal proceeding or official inquiry with respect to the matters
set forth in this Announcement;
41 acknowledges that its commitment to subscribe for Placing
Shares on the terms set out in this Announcement including this
Appendix 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;
42 acknowledges that Peel Hunt, and its Affiliates acting as an
investor for its or their own account(s) may, subscribe for and/or
purchase Placing Shares and, in that capacity may retain, purchase,
offer to sell or otherwise deal for its or their own account(s) in
the Placing Shares, any other securities of the Company or other
related investments in connection with the Placing or otherwise.
Accordingly, references in this Announcement to the Placing Shares
being offered, subscribed, acquired or otherwise dealt with should
be read as including any offer to, or subscription, acquisition or
dealing by, Peel Hunt and/or any of its Affiliates acting as an
investor for its or their own account(s). Each Placee further
acknowledges that Peel Hunt and its Affiliates may enter into
financing arrangements and swaps with investors in connection with
which Peel Hunt and any of its Affiliates may from time to time
acquire, hold or dispose of such securities of the Company,
including the Placing Shares. Neither Peel Hunt nor the Company
intend to disclose the extent of any such investment or transaction
otherwise than in accordance with any legal or regulatory
obligation to do so; and
43 acknowledges that its participation in the Placing, these
terms and conditions and any contractual or non-contractual
obligations arising out of, or in relation to thereto, shall be
governed by and construed in accordance with English law and that
the courts of England shall have exclusive jurisdiction to hear and
decide any proceedings which may arise out of or in connection with
these terms and conditions, except that enforcement proceedings in
respect of the Placee's obligation to make payment for the Placing
Shares (together with any interest chargeable thereon) may be taken
by Peel Hunt or the Company in any jurisdiction.
The acknowledgements, agreements, undertakings, representations
and warranties referred to above are given to each of the Company
and Peel Hunt (for their own benefit and, where relevant, the
benefit of their respective Affiliates) and any person acting on
their behalf and are irrevocable.
No claim shall be made against the Company, Peel Hunt or their
respective Affiliates or any other person acting on their behalf of
any of such persons by a Placee to recover any damage, cost, charge
or expense which it may suffer or incur by reason of or arising
from the carrying out by it of the work to be done by it pursuant
to this Announcement or the performance of its obligations pursuant
to this Announcement or otherwise in connection with the
Placing.
No UK stamp duty or stamp duty reserve tax should be payable to
the extent that the Placing Shares are issued or transferred (as
the case may be) into CREST to, or to the nominee of, a Placee who
holds those shares beneficially (and not as agent or nominee for
any other person) within the CREST system and registered in the
name of such Placee or such Placee's nominee.
Any arrangements to issue or transfer the Placing Shares into a
depositary receipts system or a clearance service or to hold the
Placing Shares as agent or nominee of a person to whom a depositary
receipt may be issued or who will hold the Placing Shares in a
clearance service, or any arrangements subsequently to transfer the
Placing Shares, may give rise to stamp duty and/or stamp duty
reserve tax, for which neither the Company nor Peel Hunt 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 stamp duty or
stamp duty reserve tax undertakes to pay such stamp duty or stamp
duty reserve tax forthwith and to indemnify on an after-tax basis
and to hold harmless the Company and Peel Hunt in the event that
either of the Company and/or Peel Hunt has incurred any such
liability to stamp duty or stamp duty reserve tax.
In addition, Placees should note that they will be liable for
any capital duty, 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
acquisition by them of any Placing Shares or the agreement by them
to acquire any Placing Shares.
All times and dates in this Announcement may be subject to
amendment. Peel Hunt shall notify the Placees and any person acting
on behalf of the Placees of any such changes.
This Announcement has been issued by the Company and is the sole
responsibility of the Company.
Each Placee, and any person acting on behalf of the Placee,
acknowledges that Peel Hunt does not owe any fiduciary or other
duties to any Placee in respect of any representations, warranties,
undertakings or indemnities in the Placing Agreement.
The rights and remedies of Peel Hunt and the Company under these
terms and conditions are in addition to any rights and remedies
which would otherwise be available to each of them and the exercise
or partial exercise or partial exercise of one will not prevent the
exercise of others.
Each Placee may be asked to disclose in writing or orally to
Peel Hunt:
(a) if he is an individual, his nationality; or
(b) if he is a discretionary fund manager, the jurisdiction in
which the funds are managed or owned.
Information to Distributors
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "MiFID
II Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the Product Governance
Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has
determined that the Placing Shares are: (i) compatible with an end
target market of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each
as defined in MiFID II; and (ii) eligible for distribution through
all distribution channels as are permitted by MiFID II (the "Target
Market Assessment"). Notwithstanding the Target Market Assessment,
distributors should note that: the price of the Company's ordinary
shares may decline and investors could lose all or part of their
investment; the Company's ordinary shares offer no guaranteed
income and no capital protection; and an investment in the
Company's ordinary shares is compatible only with investors who do
not need a guaranteed income or capital protection, who (either
alone or in conjunction with an appropriate financial or other
adviser) are capable of evaluating the merits and risks of such an
investment and who have sufficient resources to be able to bear any
losses that may result therefrom. The Target Market Assessment is
without prejudice to the requirements of any contractual, legal or
regulatory selling restrictions in relation to the Placing.
Furthermore, it is noted that, notwithstanding the Target Market
Assessment, the Banks will only procure investors who meet the
criteria of professional clients and eligible counterparties. For
the avoidance of doubt, the Target Market Assessment does not
constitute: (a) an assessment of suitability or appropriateness for
the purposes of MiFID II; or (b) a recommendation to any investor
or group of investors to invest in, or purchase, or take any other
action whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCMFBBTMBTBTTL
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October 17, 2019 02:00 ET (06:00 GMT)
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