TIDMMAB
RNS Number : 8117P
Mitchells & Butlers PLC
22 February 2021
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM
AUSTRALIA, CANADA, THE REPUBLIC OF IRELAND, JAPAN, NEW ZEALAND,
SOUTH AFRICA, THE UNITED STATES OR ANY JURISDICTION WHERE TO DO SO
WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A
PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. NOTHING HEREIN SHALL
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
PURCHASE ANY SECURITIES, OR CONSTITUTE OR FORM PART OF ANY OFFER TO
ACQUIRE ANY SECURITIES, IN ANY JURISDICTION. ANY DECISION TO
PURCHASE, SUBSCRIBE FOR, OTHERWISE ACQUIRE, SELL OR OTHERWISE
DISPOSE OF, ANY SECURITIES REFERRED TO IN THIS ANNOUNCEMENT MUST BE
MADE SOLELY ON THE BASIS OF THE INFORMATION THAT IS CONTAINED IN
THE PROSPECTUS TO BE PUBLISHED BY THE COMPANY IN DUE COURSE
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
22 February 2021
MITCHELLS & BUTLERS PLC
LEI no: 213800JHYNDNB1NS2W10
Open Offer to raise up to GBP351 million
Notice of General Meeting
Following the announcement on 15 February 2021, the Board of
Mitchells & Butlers plc (the "Company" and, together with its
subsidiaries, "Mitchells & Butlers" or the "Group"), today
announces an underwritten fully pre-emptive open offer (the "Open
Offer") to raise up to GBP351 million.
Background to the Open Offer
-- The Group's liquidity position has deteriorated significantly
as a result of the impact of the COVID-19 pandemic and the Open
Offer is critical for the continued operation of the Group and its
immediate financial stability
-- An Open Offer of up to GBP351 million provides the Company
with the capital to reduce its unsecured debt and to support the
Group's secured debt financing through an injection of equity,
allowing the Group to meet its fixed obligations
-- It will also enable the resumption of investment in the
Group's estate to maintain its competitive position, providing the
financial stability and strength to emerge from the crisis,
allowing previous momentum to be regained
-- On 14 February 2021, the Company reached agreement with its
relationship banks for a new GBP150 million 3 year unsecured
revolving credit facility (the "Refinancing"). The facility under
the Refinancing is conditional on completion of the Open Offer
-- Additionally, on 14 February 2021 an agreement was reached on
a number of amendments and waivers (the "2021 WBS Amendments and
Waivers") with Ambac Assurance UK Limited as controlling creditor
and HSBC Trustee (C.I.) Limited as trustee and borrower security
trustee in respect of certain potential breaches under its secured
debt financing arising as a result of the ongoing impact of COVID
and the measures taken to stem the spread of the virus. In the
event that the Open Offer is not completed, such Amendments and
Waivers may be withdrawn
-- Pursuant to the Open Offer, the Company is proposing to offer
New Shares to all Qualifying Shareholders at a price of 210 pence
per share on the basis of 7 New Shares for every 18 Existing
Shares
-- As announced on 15 February 2021, Piedmont Inc., Elpida Group
Limited and Smoothfield Holding Ltd. have been acquired by Odyzean
Limited and as such are now wholly owned subsidiaries of Odyzean
(collectively the "Odyzean Group"). As a result, the Odyzean Group
held approximately 55 per cent. of the Company's issued share
capital as at 19 February 2021
-- The Odyzean Group has entered into an irrevocable undertaking
with the Company to take up its entitlements under the Open Offer
and to subscribe for any additional shares that become available
through, and are allocated to it under, the Excess Application
Facility. The Open Offer is therefore fully underwritten
-- The Open Offer is conditional upon shareholder approval
Morgan Stanley & Co. International plc ("Morgan Stanley") is
acting as Financial Adviser, Global Co-ordinator, Joint Bookrunner,
Corporate Broker and Sponsor, alongside N. M. Rothschild & Sons
Limited ("Rothschild & Co") as Financial Adviser to the
Company. HSBC Bank plc ("HSBC") and Banco Santander, S.A.
("Santander") are acting as Joint Bookrunners.
Capitalised terms not otherwise defined in this announcement
shall have the meaning set out in the Appendix to this
announcement.
All documents relating to the Open Offer and the details of a
conference call at 8.30am this morning can be found at
www.mbplc.com/investors/capitalraise .
The person responsible for arranging for the release of this
announcement on behalf of Mitchells & Butlers is Greg
McMahon.
Contact details:
Company
Mitchells & Butlers plc
Tim Jones
Tel: +44 (0) 121 498 6112
Gabby Shilvock
Tel: +44 (0)121 498 6514
Financial Adviser, Global Co-ordinator, Joint Bookrunner,
Corporate Broker and Sponsor Morgan Stanley
Nick Bishop
Andrew Foster
Melissa Godoy
Anthony Zammit
Tel: +44 (0) 20 7425 8000
Financial Adviser
Rothschild & Co
Edward Duckett
Francis Burkitt
Claire Suddens-Spiers
Shannon Nicholls
Tel: +44 (0) 20 7280 5000
Joint Bookrunner
HSBC
Richard Fagan
Pushpjit Singh Malik
Tel: +44 (0) 20 7991 8888
Joint Bookrunner
Santander
Javier Mata
Simon Payne
Michael Ward
Santander Equity Syndicate
Tel: +34 692 206 356
Media
Finsbury
James Murgatroyd
Tel: +44 (0) 20 7251 3801
Background to the Open Offer
2020 saw Mitchells & Butlers face the most challenging year
in its history from an operational perspective. The impact of the
COVID-19 pandemic has resulted in multiple periods of total closure
of the restaurant, pub and bar estates in the United Kingdom and
Germany and varying degrees of restrictions during the periods
since March 2020 where only limited trading has been possible.
The Group's liquidity position has deteriorated significantly as
a result of these closures and restrictions and the Open Offer is
critical for the continued operation of the Group and its immediate
financial stability. To provide the Group with a strong and stable
financial base, the Group has agreed the 2021 WBS Amendments and
Waivers with Ambac and the Trustee with respect to the WBS
financing, and the New Debt Package with its Lenders, both of which
are contingent on the successful completion of the Open Offer. The
absence of these new arrangements will result in events of default
under the Existing Facilities and the Issuer/ Borrower Facility
Agreement (which will occur on 10 April 2021 with respect to the
Existing Facilities and, with respect the Issuer/Borrower Facility,
would be expected to occur on 30 April 2021 (being the date on
which Ambac and the Trustee may withdraw their consents to the 2021
WBS Amendments and Waivers in the event that the Open Offer has not
been completed by then)).
The successful completion of the Open Offer will allow the Group
to avoid these events of default. The Open Offer will also allow
the Group to take advantage of the previous operational progress
gained in the context of a potentially weakened hospitality sector
in order to win market share and to continue with its long-term
strategy of creating value for shareholders by reducing the Group's
level of debt as a proportion of the total value of the Group's
business.
Reasons for the Open Offer
The Directors unanimously agree that the Open Offer is critical
for the continued operation and financial stability of the Group,
including the WBS Group, and for managing the business through the
current pandemic and, ultimately, to deliver long-term, sustainable
growth to Shareholders.
The effect of the COVID-19 pandemic on trading has had a
significant adverse impact on the financial position of the
business. Prolonged periods of closure have caused a drain on cash
resources, and the cumulative effect of three lockdowns in England
over the past year is significant. Even where the Group's sites
have been allowed to open, social distancing restrictions have had
a material impact on sales, with tier 2 and 3 sites experiencing
sales declines for sites when open in FY21, of 35.8 per cent. from
14 October to the close of 4 November 2020, approaching the point
at which profit generation becomes marginal. During December 2020,
more than 90 per cent. of the estate was closed over the important
festive season, one of the most profitable times of the year for
the Group and other businesses in the hospitality sector, and
currently the Group is facing a further prolonged period of closure
with no certainty on an end date. Uncertainty remains over the
restrictions which will be in place when restaurants, pubs and bars
are permitted to reopen, and it is expected that trading levels for
the remainder of this year will be lower than pre-COVID levels.
When substantially closed, the Group's cashflows are cash negative
thereby depleting its cash resources. While the Group benefits from
UK Government support measures (such as relief from business rates
and the Coronavirus Job Retention Scheme), these may not be
extended and are not sufficient to cover the Group's current costs.
The Group had a cash balance of GBP113 million as at 16 January
2021. Agreement has been reached with the trustee of the Group
pension funds to delay monthly contributions from January to March
2021, inclusive, with these becoming due in April 2021. Taking this
into account, from 1 January 2021 through to the date of this
announcement, during which time the Group's estate has been fully
closed, cash burn was estimated to be between GBP30 million and
GBP35 million per four-week period. In addition, the Group has
securitised debt servicing costs of GBP51 million per quarter
(comprising interest and amortisation) as well as GBP13 million of
deferred pensions payments in regard to January, February and March
2021. The Group may also look to acquire suitable restaurants, pubs
and bars which come to market.
In addition, the consequence of the financial impact of COVID-19
has been an increase in unsecured debt. As at 28 September 2019 the
Group had unsecured committed bank facilities totalling GBP150
million, of which nil was drawn. Prior to the first national
lockdown in March 2020, the full GBP150 million was drawn on 16
March 2020. Subsequently an additional GBP100 million was raised
through the UK Government backed CLBILS on 11 June 2020. Since 5
January 2021 the full amount of GBP250 million has been drawn. This
increase in unsecured debt is not sustainable in the long-term,
particularly given further uncertainty that lies ahead. Capital
expenditure has also been suspended from March 2020 due to the
pandemic, which is also not sustainable as investment is crucial to
maintaining the competitiveness and condition of the estate. As
described above, the Group also agreed the 2021 WBS Amendments and
Waivers with Ambac and the Trustee with respect to the WBS
financing, and the New Debt Package with its Lenders, both of which
are contingent on the successful completion of the Open Offer.
The Directors carefully considered the best time to launch an
Open Offer. At the beginning of the crisis, during initial closure,
short-term agreements with Ambac and the Trustee, together with
additional liquidity from the Group's unsecured lenders were
obtained so that the severity of the impact could be assessed.
Three prolonged periods of closure of various lengths have now been
endured, and the end to the current lockdown is uncertain putting
pressure on the Group's liquidity position. There is a need for
additional liquidity in order to meet the Group's immediate debt
service obligations and to obtain the 2021 WBS Amendments and
Waivers and the New Debt Package and thus avoid events of default
under the Group's Existing Facilities and the Issuer/Borrower
Facility Agreement (which will occur on 10 April 2021 with respect
to the Existing Facilities and, with respect the Issuer/Borrower
Facility, would be expected to occur on 30 April 2021 (being the
date on which Ambac and the Trustee may withdraw their consents to
the 2021 WBS Amendments and Waivers in the event that the Open
Offer has not been completed by then)).
A key consideration has also been the quantum of the proposed
Open Offer. In addition to providing the ability to meet its fixed
costs and to enable the resumption of investment in the estate, the
Directors considered a number of different scenarios and
assumptions and the impact these might have on the Group's
financial position. These included the length of the current
lockdown, potential future lockdowns, the impact of ongoing social
distancing measures, the strength of any possible recovery, and the
likelihood of any further restrictions. Taking these into
consideration, the Directors believe that an Open Offer to raise
gross proceeds of GBP351 million would provide the Group with the
optimum capital structure to support the business through the
current pandemic, and, going forward, deliver its strategy.
The Directors have carefully considered the timing of the Open
Offer and believe that the quantum of the Open Offer will be
sufficient to meet the needs of the business and is a prudent and
sensible approach to address the current liquidity constraints, to
support the balance sheet and to position the Group to emerge from
this pandemic in a stronger financial position.
Future arrangements with the Odyzean Group
As a result of the establishment of Odyzean Limited, 55 per
cent. of the Company's Shares are owned and controlled by the
Odyzean Group. The Odyzean Group has communicated to the Company
that it is fully supportive of the Group's management team, which
has re-established the business as a sector leader with a strong
focus and direction. The Odyzean Group has indicated that, in order
to streamline decision-making, it intends to review the composition
of the Board, which may result in fewer independent Non-Executive
Directors and less focus on compliance with the UK Corporate
Governance Code recommendations in the future. In particular, the
Odyzean Group has indicated that it will disregard specific
corporate governance expectations around tenure and that it expects
the Board to focus on retaining and acquiring skillsets amongst the
independent Non-Executive Directors that are required to optimise
the development of the business going forward. The Odyzean Group
has also indicated that the time and cost devoted by the senior
management team to public company matters should be reduced.
The Odyzean Group has said that it intends to work with the
management team to ensure the strategy and structure of the
business are appropriate to optimise its long-term success. The
Odyzean Group believes the long-term success of the Company would
be beneficial to all stakeholders, including its approximately
40,000 employees and its suppliers, lenders and shareholders. The
Odyzean Group believes that this review could include consideration
of the speed and nature of the existing Ignite investment programme
and opportunities for acquisitions and partnerships. In order to
support these initiatives, the Company may in the medium term (at
least 12 months after the date of this announcement) need to raise
additional capital through the issue of new shares.
Prior to the formation of the Odyzean Group, the shareholder
representatives of Piedmont Inc. and Elpida Group Limited confirmed
their support for the Group's proposed remuneration policy. The
Odyzean Group subsequently confirmed that it will continue to
support the proposed remuneration policy, but has indicated that it
intends to work with the Board to ensure the remuneration structure
for all levels of the management team remains fully aligned with
both the strategy of the business and shareholder value
maximisation over the long-term. Any changes to the current
remuneration structure, if proposed, may run counter to listed
company norms and benchmarking. The Odyzean Group has, however,
confirmed that there are no immediate plans to propose or implement
arrangements which are not consistent with the proposed
remuneration policy.
In addition, the Odyzean Group has indicated that it will
support a focus on reinvesting any surplus cash in the Group's
businesses and therefore would prefer the Company to prioritise
debt repayment and investment in the Group's businesses over the
payment of dividends for the foreseeable future.
As a result of the Odyzean Group holding over 30 per cent. of
the Company's shares, the Odyzean Group is considered to be a
controlling shareholder for the purposes of the Listing Rules. The
Company has requested that the Odyzean Group enters into a
relationship agreement with the Company in compliance with the
Listing Rules, which the Company has six months to put in place
from the time at which the Odyzean Group became a controlling
shareholder. A relationship agreement requires a controlling
shareholder to: (a) only enter into transactions and arrangements
with the company on an arm's length basis and on normal commercial
terms; (b) ensure it and its associates do not take any action
which would prevent the company from complying with its obligations
under the Listing Rules; and (c) not propose, and ensure its
associates do not propose, any shareholder resolution which is
intended to circumvent the proper application of the Listing Rules.
If the Odyzean Group does not enter into a relationship agreement
with the Company during such six month period, the Company will be
required to disclose this in its annual report and any transactions
entered into between the Company and members of the Odyzean Group
will not be subject to certain exemptions from the related party
rules set out in the Listing Rules. The Company would expect such
enhanced oversight measures to apply until a relationship agreement
was entered into. The Company may need to consider a transfer of
its listing category from a premium listing to a standard listing
if a relationship agreement that satisfies the Listing Rules is not
entered into with Odyzean Limited, and potentially its owners,
within six months of them having become controlling shareholders.
If the Company moved to a standard listing this may have adverse
consequences for the Company and its shareholders, such as
exclusion from certain of the FTSE indices for listed shares.
Further, as a result of the Odyzean Group holding over 50 per
cent. of the Company's issued share capital, it may acquire further
interests in the Company without being required to make a mandatory
offer for the remaining Shares pursuant to Rule 9 of the Takeover
Code.
If there is any change of control of Odyzean after the initial
formation of Odyzean which results in a change of control of the
Company, there would be a termination right for the lenders under
the New RCF Agreement.
Use of Proceeds
The Open Offer is expected to raise up to GBP351 million in
gross proceeds and up to approximately GBP340 million in net
proceeds.
An Open Offer of up to GBP351 million provides the Company with
the capital to reduce its unsecured debt and to support the WBS
financing through an injection of equity, allowing the Group to
meet its fixed obligations and also enabling the resumption of
investment in the estate to maintain the competitive position. The
Open Offer is intended to provide the Group with the financial
stability and strength to emerge from the crisis, allowing previous
momentum to be regained.
The Company intends to use the net proceeds of the Open Offer
for:
-- Repayment of GBP100 million in debt in connection with the
refinancing of the Existing Facilities;
-- Full repayment of GBP150 million under the RCF Agreements
(offset in full by GBP150 million made available under the New RCF
Agreement);
-- Paying overdue rental payments of GBP28 million and deferred VAT of GBP30 million;
-- Making an equity injection into the WBS Group in order to
enable the WBS Group to repay an anticipated GBP60 million of debt
to be incurred under the WBS' Liquidity Facility as at March 2021,
with full repayment of the drawn amount to be settled no later than
December 2021;
-- Making deferred pension payments of GBP13 million in respect
of each of January, February and March 2021; and
-- The general funding of the business going forward including
cash payments in advance of the estate resuming trade and the
future purchase of sites which come to market if there is
sufficient funding to do so.
The New Debt Package
The Company has agreed the terms of the New Debt Package which,
when taken together with the Open Offer , will be sufficient to
refinance GBP200 million of the Group's existing debt, being all of
the Group's existing unsecured debt facilities save for the
Santander CLBILS of GBP50 million which may remain outstanding (the
"Refinanced Facilities"). The Existing Facilities all mature on 31
December 2021. As at the date of this announcement, the Existing
Facilities are all fully drawn.
The New Debt Package is conditional upon completion of the Open
Offer , which itself is contingent on the passing of all the
Resolutions. Consequently, if any of the Resolutions relating to
the Open Offer are not approved and the Open Offer is not completed
successfully, the New Debt Package will lapse and cease to be
available to the Company. The New Debt Package is not, however,
conditional on the 2021 WBS Amendments and Waivers set out below
(and there would be no default under the New Debt Package in
relation to the WBS Group, including if the 2021 WBS Amendments and
Waivers were not in place).
Failure to complete the New Debt Package would mean that the
Group would breach a number of financial covenants in the Existing
Facilities on 10 April 2021. The minimum liquidity headroom in the
Existing Facilities as at the end of each four-week accounting
period would need to be maintained. The next four test dates are 13
March 2021, 10 April 2021, 8 May 2021 and 5 June 2021. The minimum
liquidity headroom required by the Existing Facilities is GBP30
million as at 13 March 2021 and GBP25 million as at 10 April 2021
and at the end of each four-week accounting period thereafter. The
Company expects that it would not meet this requirement for the
first time on 10 April 2021 with a shortfall of GBP32 million. The
minimum liquidity covenant under each of the Existing Facilities
has been waived from launch of the Open Offer until the earliest of
six weeks after such launch, receipt of proceeds from the Open
Offer and 31 May 2021. At the end of the waiver period, the Company
must ensure that the minimum liquidity covenant was met at the
previous test dates. The remaining financial covenants do not apply
until the test date on 10 April 2021. At that date, the relevant
test would be in respect of the ratio of the EBITDAR of members of
the Unsecured Group to net rent payable plus interest, for each of
the two preceding quarterly testing dates. The Company would fail
this test on that date, with an EBITDAR shortfall of GBP53 million.
Such breaches would constitute events of default under the Existing
Facilities entitling the Lenders to declare all amounts outstanding
under the Existing Facilities (approximately GBP250 million as at
19 February 2021) as immediately due and payable, and to take
enforcement action against the Group.
The Directors do not expect the Group to have sufficient funds
available to repay the expected amounts due in such circumstances.
In the absence of being able to agree or implement successfully any
of the alternatives arrangements considered below, enforcement
action by the Lenders (by way of accelerating their loans
insolvency proceedings) would likely result in Shareholders losing
all or a substantial part of the value of their investment in the
Company.
If the Open Offer does not proceed, the Company would put in
place an action plan to seek to avoid the possibility of
enforcement action by the Lenders. The Directors expect that the
Company would seek to obtain waivers, amendments and/or
standstills, although the Lenders have given no indication that
such waivers, amendments and/or standstills would be
forthcoming.
The Directors expect that the Company would also ask the Lenders
to further amend the Existing Facilities to allow additional
funding to be made available to the Group (either by the Lenders or
by alternative finance providers) and/or seek alternative
financing. The Directors believe that such amendments would only be
agreed to by the Lenders, if at all, at a significant cost to the
Group in the form of additional fees payable to the Lenders,
increased interest payments and/or additional restrictions on, or
commitments to engage in, corporate actions (such as the
restriction of payment of dividends to Shareholders, acquisitions
and disposals), which would adversely affect or delay
implementation of the Company's strategies.
The Directors are not confident that additional financing would
be achievable, nor that the Lenders would be willing to continue to
support the business in these circumstances and, therefore, the
most likely outcome would be that the Shareholders would lose all
or a substantial part of the value of their investments in the
Company as a result of the enforcement action taken by the
Lenders.
Furthermore, in light of the undertaking provided by the Company
under the 2021 WBS Amendments and Waivers to provide funding to the
Borrower by way of additional equity in an amount at least equal to
the amounts drawn under the Liquidity Facility, in the event that
the Open Offer or the New Debt Package is not completed
successfully, the Company would have insufficient funds available
to provide such funding to the WBS Group. In such circumstances,
Ambac and the Trustee will have the right to withdraw their
respective consents to any amendments and waivers effected by the
2021 WBS Amendments and Waivers, the consequences of which are
detailed below.
2021 WBS Amendments and Waivers
In addition to the unsecured financing arrangements of the Group
described above, the Borrower established, in November 2003, the
WBS pursuant to which the Issuer was established to issue secured
notes, the proceeds of which were on-lent to the Borrower under the
Issuer/Borrower Facility Agreement which imposes certain covenants
on the Borrower and the WBS Group. The Borrower must dedicate a
portion of the cash flow (which amounted to GBP197 million in FY19,
the last full year prior to the COVID-19 pandemic) generated from
the restaurants, pubs and bars owned by the WBS Group to service
its debt obligations under the Issuer/Borrower Facility Agreement
which the Issuer then uses to make payments in respect of the
issued notes.
As a result of the impact of the COVID-19 pandemic and the
various measures taken by the Government and the devolved
administrations in the United Kingdom to stem the spread of the
pandemic, requiring closure of, or restriction on operations and/or
capacity within the WBS Estate since March 2020, the WBS Group has
been unable to comply with a number of the covenants set out in the
Issuer/Borrower Facility Agreement. In June 2020, Ambac and the
Trustee granted the 2020 WBS Amendments and Waivers, including
waivers of non-payment events of default arising as a result of
failure by the Borrower to pay its full debt service to the Issuer
for the loan payment dates in June 2020 up to and including
December 2020 and a waiver of the requirement to comply fully with
the Debt Service Covenant up to and including April 2021. However,
given the continuing impact of the COVID-19 pandemic and the
ongoing measures requiring closures of, and restrictions on
operations within, the WBS Estate, the Borrower requires extensions
to, and further modifications in respect of, the 2020 WBS
Amendments and Waivers so as to address further breaches of the
Issuer/Borrower Facility Agreement which will occur upon the expiry
of the 2020 WBS Amendments and Waivers.
Under the terms of the 2021 WBS Amendments and Waivers, a number
of the amendments/waivers apply with effect from 14 February 2021
(including amendments in relation to a 30-day suspension of
business provision (effective as of 31 December 2020) and the
waivers and amendments in relation to the failure by the WBS Group
to pay in full the debt service over the next three quarters),
whilst a number of other amendments and waivers thereunder will
only come into effect upon receipt by the Company of the proceeds
of the Open Offer (including amendments in relation to the debt
service coverage ratio covenant, facilitating disposals of
properties by the WBS Group and lifting a restriction on making
acquisitions). To the extent that the Open Offer is not completed
successfully by 30 April 2021, Ambac and the Trustee will be
entitled to withdraw their respective consents to those amendments
and waivers which came into effect on 14 February 2021, and the
balance of the amendments and waivers under the 2021 WBS Amendments
and Waivers would not come into effect at all.
Whilst the New Debt Package is not conditional on the 2021 WBS
Amendments and Waiver, the 2021 WBS Amendments and Waivers (other
than the amendments/waivers which apply with effect from 14
February 2021) are conditional upon entry by the Company into the
New Debt Package and applying the New Debt Package to refinance the
Existing Facilities other than the Santander CLBILS. Failure to
satisfy this condition by 30 April 2021 will also entitle Ambac and
the Trustee to withdraw their respective consents to the waivers in
effect under the 2021 WBS Amendments and Waivers by 30 April
2021.
The absence and/or withdrawal of the 2021 WBS Amendments and
Waivers would mean that the Borrower would immediately be in breach
of a number of provisions of the Issuer/Borrower Facility Agreement
with effect from such date of withdrawal. In particular, the waiver
of the note payment date of 15 March 2021 and the waiver that
allows for the deferral of the repayment of GBP9 million drawn on
the Liquidity Facility and a further GBP50.7 million drawing in
March 2021 would, following such withdrawal, be ineffective and the
Group does not expect that the WBS Group would have sufficient
funds to repay these amounts should they become immediately due and
payable. In addition, under the 2020 WBS Amendments and Waivers,
the WBS financial covenants are currently fully waived until the
test date at the end of July 2021. At that date, the relevant test
would be in respect of the free cashflow to debt service for the
preceding two quarters. In the absence of the 2021 WBS Amendments
and Waivers, the test would be failed at that date, with an
estimated free cashflow shortfall of GBP122 million. Such breaches
would constitute events of default under the Issuer/Borrower
Facility Agreement entitling Ambac to instruct the Trustee to
declare the principal amount outstanding (GBP1,580 million as at 19
February 2021) and all other sums payable under the Issuer/Borrower
Facility Agreement to be immediately due and repayable . In the
event that all amounts outstanding under the Issuer/Borrower
Facility Agreement were declared immediately due and repayable,
certain other amounts may also become due and payable including,
for example, termination amounts in respect of the related hedging
arrangements (the mark-to-market value of which is currently around
GBP250 million).
The Directors do not expect the WBS Group to have sufficient
funds available to repay the expected amounts outstanding under the
Issuer/Borrower Facility Agreement if they become due and payable.
In the absence of being able to raise other debt in order to repay
the amounts due under the Issuer/Borrower Facility Agreement, it
would be open to Ambac and the Trustee to take enforcement action
with respect to the Borrower Security (comprising the assets of the
WBS Estate), including a sale of the WBS Group and/or the WBS
Estate as a whole or piecemeal. Enforcement action by Ambac and the
Trustee (by way of a sale of the WBS Group or otherwise) would be
likely to result in Shareholders losing all or a substantial part
of the value of their investment in the Company.
If the Open Offer does not proceed, the Company and the Borrower
would put in place an action plan to seek to avoid the possibility
of enforcement action by the Trustee and Ambac , in light of the
expected event of default on all of its financing arrangements .
The Directors expect that the Company and the Borrower would seek
to obtain waivers, amendments and/or standstills, although Ambac
and the Trustee have given no indication that such waivers,
amendments and/or standstills would be forthcoming.
If the Open Offer does not proceed, the Directors expect that
the Group would also look to obtain alternative financing so as to
give Ambac and the Trustee comfort that the WBS Group will have
sufficient financial support to be able to continue to run its
business and service its debt obligations under the Issuer/Borrower
Facility Agreement, such that Ambac and the Trustee agree not to
take enforcement action with respect to the Borrower Security. To
date, Ambac and the Trustee have given no indication that their
consent would be forthcoming if the Open Offer is not completed.
The Directors believe that such consent would only be provided by
Ambac and the Trustee at significant cost to the Group in the form
of additional fees payable to Ambac and possibly other secured
creditors of the WBS Group and/or additional restrictions on, or
commitments to engage in, corporate actions (such as the
restriction of payment of dividends by the WBS Group to the wider
Group, acquisitions and disposals), each of which would adversely
affect or delay implementation of the Group's strategies and may
ultimately be unsustainable.
It should be noted that even if the Open Offer is completed
successfully and the requisite portion of the proceeds thereof are
put into the WBS Group, the WBS Group will still need the 2021 WBS
Amendments and Waivers in respect of the breach the debt service
coverage ratio covenant and certain other covenants because such
covenants will not be cured by the amount of equity which will be
put into the WBS Group. As set out in the Prospectus, compliance
with such covenants will only be possible once the WBS Estate is
able to reopen and trade sufficiently so as to generate enough
revenue, which is why the 2021 WBS Amendments and Waivers in
respect of the relevant covenants are permitted to apply up to
until January 2023.
In addition, the Odyzean Group has entered into an irrevocable
undertaking with the Company to vote in favour of the Resolutions
to be proposed at the General Meeting and to subscribe for its pro
rata entitlement under the Open Offer and to subscribe for any
Excess Shares made available and allocated to it through the Excess
Application Facility. However, if the Odyzean Group should fail to
subscribe for any New Shares, including Excess Shares that are made
available and allocated to it under the Excess Application
Facility, the Global Coordinator will be entitled to terminate the
obligations of the Underwriters under the Underwriting Agreement.
If the Underwriting Agreement is terminated, the Open Offer will
not be successfully completed, as a result of which the New Debt
Package will lapse and cease to be available to the Company and
Ambac and the Trustee would be entitled to withdraw their
respective consents to the waivers in effect under the 2021 WBS
Amendments and Waivers by 30 April 2021. This would result in
events of default under the Existing Facilities and the
Issuer/Borrower Facility Agreement (which will occur on 10 April
2021 with respect to the
Existing Facilities and, with respect the Issuer/ Borrower
Facility, would be expected to occur on 30 April 2021 (being the
date on which Ambac and the Trustee may withdraw their consents to
the 2021 WBS Amendments and Waivers in the event that the Open
Offer has not been completed by then)). These events of default
would be likely to result in Shareholders losing all or a
substantial part of the value of their investment in the
Company.
Conclusion
The Directors believe that the Open Offer is critical to
avoiding events of default under the Existing Facilities and the
Issuer/Borrower Facility Agreement (which will occur on 10 April
2021 with respect to the Existing Facilities and, with respect the
Issuer/Borrower Facility, would be expected to occur on 30 April
2021 (being the date on which Ambac and the Trustee may withdraw
their consents to the 2021 WBS Amendments and Waivers in the event
that the Open Offer has not been completed by then)), and therefore
for the continued operation and financial stability of the Group
(including the WBS Group) and, in addition, that (i) the New Debt
Package represents a favourable option in respect of the
refinancing of the Company's Existing Facilities and (ii) the 2021
WBS Amendments and Waivers are essential in order to prevent a
breach of certain provisions of the WBS financing which would put
the WBS Group, and the assets of the WBS Estate, at risk of being
subject to enforcement action.
For these reasons, it is essential that Shareholders vote in
favour of the Resolutions, as the Directors consider the Open Offer
to be a critical transaction for the Company and to be the best
transaction available to the Company, its Shareholders and its
stakeholders as a whole in the current circumstances.
The Company expects to publish a combined prospectus and
circular in connection with the Open Offer (the "Prospectus") at
www.mbplc.com/investors/capitalraise later today which will be sent
to Shareholders on 23 February 2021, in order to convene the
General Meeting. Full details of the Open Offer will be included in
the Prospectus.
The Prospectus will be submitted to the National Storage
Mechanism and will shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
An indicative timetable for the Open Offer is set out below. The
times and dates set out in the indicative timetable and mentioned
throughout this announcement are times and dates in London and may
be adjusted by the Company.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Record Date for entitlements under the Open Offer 6.00 p.m. on 17 February 2021
Announcement of the Open Offer and publication of the 22 February 2021
Prospectus
Ex-entitlement date for the Open Offer 8.00 a.m. on 22 February 2021
Posting of the Prospectus, which contains the notice of 23 February 2021
General Meeting, the Form of Proxy,
and the Application Forms (to Qualifying non-CREST
Shareholders only)
Publication of notice of the Open Offer in the London 23 February 2021
Gazette
Open Offer Entitlements and Excess Open Offer As soon as practicable after 8.00 a.m. on 24 February
Entitlements enabled in CREST and credited to 2021
stock accounts of Qualifying CREST Shareholders in CREST
Recommended latest time for requesting withdrawal of Open 4:30 p.m. on 4 March 2021
Offer Entitlements from CREST
Latest time and date for depositing Open Offer 3.00 p.m. on 5 March 2021
Entitlements into CREST
Latest time and date for splitting of Application Forms 3.00 p.m. on 8 March 2021
(to satisfy bona fide market claims
only)
Latest time and date for electronic proxy appointments, 10.00 a.m. on 9 March 2021
receipt of Form of Proxy or submission
of CREST Proxy Instructions
Latest time and date for receipt of completed Application 11.00 a.m. on 10 March 2021
Forms and payment in full under
the Open Offer or settlement of relevant CREST
instructions (as appropriate)
Announcement of the results of the Open Offer through a 7.00 a.m. on 11 March 2021
Regulatory Information Service
General Meeting 10.00 a.m. on 11 March 2021
Results of General Meeting announced through a Regulatory 11 March 2021
Information Service
Admission of, and dealings in New Shares commence on the 8.00 a.m. on 12 March 2021
London Stock Exchange
CREST members' accounts credited in respect of New Shares As soon as practicable after 8.00 a.m. on 12 March 2021
in uncertificated form
Expected despatch of definitive share certificates for Within 14 days of Admission
New Shares in certificated form
Terms of the Open Offer
The Directors have given careful consideration as to how to
structure the proposed issue of the New Shares. Following
consultation with several of the Company's major Shareholders, the
Directors have concluded that the Open Offer is the most suitable
option available to the Company and its Shareholders.
Pursuant to the Open Offer, the Company is proposing to offer up
to 166,937,606 New Shares by way of an open offer to Qualifying
Shareholders being Shareholders other than those with a registered
address, or resident in, one of the Excluded Territories (subject
to certain exceptions). The offer is to be made at 210 pence per
New Share, payable in full on acceptance by no later than 11.00
a.m. on 10 March 2021. The Open Offer is expected to raise up to
approximately GBP340 million, net of expenses. The Offer Price
represents a 36 per cent. discount to the closing market price of
328.5 pence per Share on 12 February 2021 (being the last Business
Day prior to the Announcement).
The Open Offer will be made on the basis of:
7 New Shares at 210 pence per New Share
for every 18 Existing Shares
held by Qualifying Shareholders at the close of business on the
Record Date. Entitlements to New Shares will be rounded down to the
nearest whole number (or to zero) and fractional entitlements will
not be allotted to Shareholders and will be discarded. Holdings of
Existing Shares in certificated and uncertificated form will be
treated as separate holdings for the purpose of calculating
entitlements under the Open Offer. Qualifying Non-CREST
Shareholders will receive an Application Form with the Prospectus
which sets out their basic entitlement to New Shares as shown by
the number of Open Offer Entitlements offered to them. Qualifying
CREST Shareholders will receive a credit to their appropriate stock
accounts in CREST in respect of their Open Offer Entitlements on 24
February 2021.
Excess Application Facility and Allocations
Qualifying Shareholders who take up their Open Offer
Entitlements in full may apply to subscribe for Excess Shares using
the Excess Application Facility. Qualifying Non-CREST Shareholders
wishing to apply to subscribe for Excess Shares may do so by
completing the relevant sections on the Application Form.
Qualifying CREST Shareholders who wish to and are able to apply to
subscribe for more than their Open Offer Entitlements will have
Excess Open Offer Entitlements credited to their stock account in
CREST, and should refer to the Prospectus for information on how to
apply for Excess Shares pursuant to the Excess Application
Facility.
The Excess Application Facility will comprise New Shares that
are offered to Qualifying Shareholders under the Open Offer as Open
Offer Entitlements but are not taken up. Qualifying Shareholders'
applications for Excess Shares will, therefore, be satisfied only
to the extent that applications by other Qualifying Shareholders
are made for less than their pro rata Open Offer Entitlements.
Each Qualifying Shareholder's application under the Excess
Application Facility will be subject to the Excess Application Cap
which will be (the "Excess Application Cap"):
(i) the number of New Shares for which the relevant Qualifying
Shareholder is entitled to subscribe pursuant to their Open Offer
Entitlement;
multiplied by
(ii) 0.81739501,
subject to any resulting fractions of Excess Shares being
rounded down to the nearest whole number.
Any application made by a Qualifying Shareholder which exceeds
the relevant Shareholder's Excess Application Cap will be deemed to
be an application for an amount equal to the relevant Shareholder's
Excess Application Cap.
The Excess Application Cap has been set at a level that ensures
that the Odyzean Group's commitment to subscribe for its Open Offer
Entitlements in full and for Excess Shares up to the level of its
Excess Application Cap results in the Open Offer being fully
subscribed from launch.
If there is an over subscription resulting from excess
applications, allocations of Excess Shares will be determined by
using the following formula (the "Excess Allocation Method"):
Each Qualifying Shareholder who takes up their Open Offer
Entitlements in full and applies for Excess Shares under the Excess
Application Facility (an "Excess Share Applicant") will be
allocated a number of Excess Shares equal to:
(i) the total number of New Shares which have not been applied
for by Qualifying Shareholders pursuant to their Open Offer
Entitlements;
multiplied by
(ii) the number of Excess Shares applied for by the Excess Share
Applicant (being a number up to their Excess Application Cap)
divided by the aggregate number of Excess Shares applied for by all
Excess Share Applicants,
subject to any resulting fractions of Excess Shares being
rounded down to the nearest whole number.
General Meeting
The Prospectus will include a notice convening a general meeting
of the Company to be held at 10.00 a.m. on 11 March 2021 by
telephone. This General Meeting is being held for the purpose of
considering and, if thought fit, passing the Resolutions as set out
therein. A summary and explanation of the Resolutions is set out in
the Notice of the General Meeting.
The Directors take the well-being of the Group's Shareholders,
directors and colleagues very seriously. The UK Government's
restrictions on public gatherings and associated social distancing
measures in respect to the COVID-19 crisis remain in place as at
the latest practicable date prior to the publication of this
announcement. The Directors therefore regret that it will not be
possible for Shareholders to attend the General Meeting in person.
Shareholders should not attend the General Meeting in person and
anyone attempting to do so will be refused entry. There will be
only limited Company representation at the meeting and the
Company's advisers have also been asked not to attend. In order to
comply with relevant legal requirements, the General Meeting will
be convened with the minimum necessary quorum. This will be
facilitated by the Company.
The Company is providing a telephone facility to allow
Shareholders to listen to the business of the General Meeting.
Further details in relation to these arrangements, including the
telephone number is in the Notice of General Meeting. Shareholders
should note that any such participation via the telephone facility
will not constitute formal attendance at the General Meeting and
Shareholders will not be able to speak, ask questions or vote on
any Resolutions through that facility. Shareholders are therefore
encouraged to register their vote in advance of the General Meeting
in the ways described below.
The Directors continue to closely monitor the evolving situation
in relation to COVID-19 and related guidance issued by the
Government, and may, if necessary, make further changes to the
arrangements for the General Meeting. Shareholders should continue
to monitor the Company's website www.mbplc.com in case there are
further changes to the arrangements for the General Meeting.
The Directors are keen to ensure that Shareholders are able to
exercise their right to vote and, accordingly, strongly recommends
that Shareholders vote on all Resolutions in advance of the General
Meeting by completing and returning their proxy forms. As no
persons other than a limited number of Company representatives will
be permitted to attend the General Meeting, Shareholders should
appoint the chairman of the General Meeting (and not any named
individual) to act as their proxy, otherwise their votes will be
incapable of being cast.
For the avoidance of doubt, it will not be possible to vote in
person at the General Meeting.
IMPORTANT NOTICES
This announcement is not intended to, and does not constitute,
an offer to sell or the solicitation of an offer to subscribe for
or buy, or an invitation to subscribe for or to purchase any
securities, or an offer to acquire via tender offer or otherwise
any securities, or the solicitation of any vote, in any
jurisdiction. This announcement has been issued by and is the sole
responsibility of the Company. 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 any of
the Underwriters or the Financial Adviser (as defined below) or by
any of their respective affiliates or agents or any of their
respective directors, officers, employees, members, agents,
advisers, representatives or shareholders as to, or in relation to,
the accuracy or completeness of this announcement or any other
written or oral information made available to any interested party
or its advisers, and any liability therefore is expressly
disclaimed.
The information contained in this announcement is for background
purposes only and does not purport to be full or complete. No
reliance may or should be placed by any person for any purpose
whatsoever on the information contained in this announcement or on
its accuracy or completeness. The information in this announcement
is subject to change.
This announcement is not a prospectus but an advertisement.
Neither this announcement nor anything contained in it shall form
the basis of, or be relied upon in conjunction with, any offer or
commitment whatsoever in any jurisdiction. Investors should not
acquire any New Shares referred to in this announcement except on
the basis of the information contained in the Prospectus to be
published by the Company in connection with the Open Offer.
Copies of the Prospectus when published will be available on the
Company's website at www.mbplc.com/investors/capitalraise. Neither
the content of the Company's website nor any website accessible by
hyperlinks on the Company's website is incorporated in, or forms
part of, this announcement. The Prospectus will provide further
details of the New Shares being offered pursuant to the Open
Offer.
Each of Morgan Stanley and HSBC are authorised and regulated in
the United Kingdom by the FCA and the Prudential Regulation
Authority ("PRA") and the Financial Adviser is authorised and
regulated in the United Kingdom by the FCA. Santander is authorised
and regulated by the Bank of Spain and subject to supervision by
the Bank of Spain and the European Central Bank and to limited
regulation by the FCA and PRA. None of the Underwriters or the
Financial Adviser will regard any person (whether or not a
recipient of this announcement) other than the Company as its
customer in relation to the Open Offer and none of them will be
responsible for providing the protections afforded to its customers
to any other person or for providing advice to any other person in
relation to the Open Offer.
This announcement, oral statements made in relation to this
announcement and other information published by the Company may
contain certain forward-looking statements, beliefs or opinions,
with respect to the financial condition, results of operations and
business of the Company and the Group. This announcement includes
statements that are, or may be deemed to be, "forward-looking
statements". The words "believe," "estimate," "target,"
"anticipate," "expect," "could," "would," "intend," "aim," "plan,"
"predict," "continue," "assume," "positioned," "may," "will,"
"should," "shall," "risk", their negatives and other similar
expressions that are predictions of or indicate future events and
future trends identify forward-looking statements. An investor
should not place undue reliance on forward-looking statements
because they involve known and unknown risks, uncertainties and
other factors that are in many cases beyond the control of the
Company or the Group. By their nature, forward-looking statements
involve risks and uncertainties because they relate to events and
depend on circumstances that may or may not occur in the future.
The Company cautions investors that forward-looking statements are
not guarantees of future performance and that its actual results of
operations and financial condition, and the development of the
industry in which it operates, may differ materially from those
made in or suggested by the forward-looking statements contained in
this announcement.
Past performance of the Company cannot be relied on as a guide
to future performance. A variety of factors may cause the Company's
or the Group's actual results to differ materially from the
forward-looking statements contained in this announcement. The
contents of this announcement are not to be construed as legal,
business, financial or tax advice. Each investor or prospective
investor should consult his, her or its own legal adviser, business
adviser, financial adviser or tax adviser for legal, financial,
business or tax advice. Nothing in this announcement should be
construed as a profit forecast.
The Company, the Underwriters, the Financial Adviser and any of
their respective directors, officers, employees, agents, affiliates
and advisers expressly disclaim any obligation to supplement,
amend, update or revise any of the forward-looking statements made
herein, except where required to do so under applicable law.
The Open Offer (subject to certain limited exceptions) is only
being extended to Qualifying Shareholders, and as such the Open
Offer (subject to certain limited exceptions) is not being extended
into the United States or any other Excluded Territory. This
announcement is for information purposes only and is not intended
to and does not constitute or form part of any offer or invitation
to sell, allot or issue, or any offer or invitation to purchase or
subscribe for, or any solicitation to purchase or subscribe for, or
an offer to acquire, any securities of the Company in Australia,
Canada, the Republic of Ireland, Japan, New Zealand, South Africa,
the United States or in any other jurisdiction where the extension
or availability of the Open Offer would result in a requirement to
comply with any governmental or other consent or any registration
filing or other formality which the Company regards as unduly
onerous or otherwise breach any applicable law or regulation.
The distribution of this announcement into jurisdictions other
than the United Kingdom may be restricted by law, and, therefore,
persons into whose possession this announcement comes should inform
themselves about and observe any such restrictions. Any failure to
comply with any such restrictions may constitute a violation of the
securities laws of such jurisdiction. In particular, subject to
certain exceptions, this announcement, the Prospectus (once
published) and the Application Forms (once printed) should not be
distributed, forwarded to or transmitted in or into the United
States or any Excluded Territory.
The New Shares, Open Offer Entitlements and Excess Open Offer
Entitlements have not been and will not be registered under the US
Securities Act of 1933, or under any securities laws of any state
or other jurisdiction of the United States, and may not be offered,
sold, taken up, exercised, resold, transferred or delivered,
directly or indirectly, within the United States. There will be no
public offer of the New Shares, Open Offer Entitlements and Excess
Open Offer Entitlements in the United States. This announcement and
any other document relating to the Open Offer may not be sent into,
distributed or otherwise disseminated (including by custodians,
nominees or trustees or others that may have a contractual or legal
obligation to forward such documents) in the United States by use
of the mails or by any means or instrumentality of interstate or
foreign commerce (including, without limitation, email, facsimile
transmission, the internet or other form of electronic
transmission) or any facility of a national securities exchange of
the United States.
This announcement is released by Mitchells & Butlers plc and
contains inside information for the purposes of Article 7 of the
Market Abuse Regulation (EU) 596/2014 as it forms part of domestic
law by virtue of the European Union (Withdrawal Act) 2018 ("UK
MAR"), encompassing certain information relating to the Open Offer
and is disclosed in accordance with the Company's obligations under
Article 17 of UK MAR.
APPIX
2021 WBS Amendments the amendments and waivers to the Issuer/Borrower
and Waivers Facility Agreement agreed on 14 February
2021
Admission admission to: (a) the premium listing
segment of the Official List; and (b)
trading on the London Stock Exchange's
main market for listed securities
Ambac Ambac Assurance UK Limited
Announcement the announcement of the Open Offer released
by the Company through a Regulatory Information
Service on 15 February 2021
Application Form the personalised application form on which
the Qualifying Non-CREST Shareholders
may apply for New Shares under the Open
Offer
Articles the articles of association of the Company
which are described in paragraph 4 of
Part X - Additional Information in the
Prospectus
Board the board of directors of the Company
Business Days a day (other than a Saturday or Sunday)
on which banks are open for general business
in London
certificated or in a share or other security which is not
certificated form in uncertificated form (that is, not in
CREST)
Company Mitchells & Butlers plc
CREST the CREST system (as defined in the CREST
Regulations)
CREST member a person who has been admitted by Euroclear
as a system--member (as defined in the
CREST Regulations)
CREST Proxy Instruction instruction to appoint a proxy or proxies
through the CREST electronic proxy appointment
service, as described in the Notice of
General Meeting at the end of the Prospectus
CREST Regulations the Uncertificated Securities Regulations
2001 (SI 2001/3755)
Directors the Executive Directors and Non--Executive
Directors of the Company
EBITDA earnings before interest, taxes, depreciation
and amortisation
EU European Union
Euroclear Euroclear UK & Ireland Limited
Excess Allocation the Excess Allocation Method referred
Method to in paragraph 2 of Part III - Terms
and Conditions of the Open Offer in the
Prospectus
Excess Application the Excess Application Cap referred to
Cap in paragraph 2 of Part III - Terms and
Conditions of the Open Offer in the Prospectus
Excess Application the facility for Qualifying Shareholders
Facility to apply for Excess Shares in excess of
their Open Offer Entitlements
Excess Open Offer in respect of each Qualifying Shareholder
Entitlements who has taken up his or her Open Offer
Entitlement in full, the entitlement (in
addition to the Open Offer Entitlement)
to apply for Excess Shares, pursuant to
the Excess Application Facility, which
may be subject to scaling down in accordance
with the Excess Allocation Method and
the terms of the Prospectus
Excess Share Applicant each Qualifying Shareholder who has (i)
taken up its Open Offer Entitlement in
full and (ii) applied for Excess Shares
under the Excess Application Facility
Excess Shares New Shares which may be applied for by
Qualifying Shareholders in addition to
their Open Offer Entitlements pursuant
to the Excess Application Facility
Excluded Territories Australia, Canada, Japan, New Zealand,
the Republic of Ireland, South Africa
and the United States
Executive Directors the executive directors of the Company
Existing Facilities (a) the bilateral revolving facility agreements
entered into between the Company, Mitchells
& Butlers Retail (No. 2) Limited, Barclays
Bank PLC, HSBC UK Bank plc and Santander
UK plc on 20 September 2017; and (b) the
bilateral term facility agreements (structured
under the UK Government-backed Coronavirus
Large Business Interruption Loan Scheme)
entered into between the Company, Mitchells
& Butlers Retail (No. 2) Limited, HSBC
UK Bank plc and Santander UK plc on 11
June 2020
Ex-Entitlement Date the date on which Existing Shares are
marked ex-entitlement, being 22 February
2021
Existing Shares the existing Shares in issue immediately
prior to the issue of the New Shares
Financial Adviser N.M. Rothschild & Sons Limited
or Rothschild & Co
Financial Conduct the Financial Conduct Authority acting
Authority or FCA in its capacity as the competent authority
for the purposes of Part VI of the FSMA
Form of Proxy the form of proxy for use at the General
Meeting which accompanies the Prospectus
Forward-looking Statements forward-looking statements, forecasts,
estimates, projections and opinions
FSMA the Financial Services and Markets Act
2000, as amended
FY19 the 52 weeks ended 28 September 2019
General Meeting the general meeting of the Company to
be held at 10.00 a.m. on 11 March 2021,
notice of which is set out at the back
of the Prospectus
Global Co-ordinator Morgan Stanley
Group the Company and its subsidiary undertakings
and, where the context requires, its associated
undertakings
HSBC HSBC Bank plc
Issuer/Borrower Facility an issuer/borrower facility agreement
Agreement between Mitchells & Butlers Retail Limited
and Mitchells & Butlers Finance plc dated
15 September 2006
Joint Bookrunners HSBC and Santander
Lenders Barclays Bank PLC, HSBC UK Bank plc and
Santander UK plc
Listing Rules the listing rules of the FCA
London Stock Exchange London Stock Exchange plc
Main Market the London Stock Exchange's main market
for listed securities
Market Abuse Regulation the UK version of Regulation (EU) 596/2014
of the European Parliament and of the
Council of 16 April 2014 on market abuse
and repealing Directive 2003/6/EC of the
European Parliament and of the Council
and Commission Directives 2003/124/EC,
2003/125/EC and 2004/72/EC, which is part
of UK law by virtue of the European Union
(Withdrawal) Act 2018, as amended from
time to time
Mitchells & Butlers Mitchells & Butlers plc and its subsidiary
undertakings and, where the context requires,
its associated undertakings
Morgan Stanley Morgan Stanley & Co. International plc
New Debt Package the revolving facility agreement entered
into between the Company, Mitchells &
Butlers Retail (No. 2) Limited, Barclays
Bank PLC, HSBC UK Bank plc and Santander
UK plc on 14 February 2021
New Shares up to 166,937,606 Shares which the Company
intends to allot and issue pursuant to
the Open Offer
Non--Executive Directors the non--executive directors of the Company
Notice of General the notice of General Meeting set out
Meeting at the back of the Prospectus
Odyzean Odyzean Limited
Odyzean Group Odyzean Limited and its subsidiary undertakings,
being Piedmont Inc., Elpida Group Limited
and Smoothfield Holding Ltd
Offer Price 210 pence per share
Official List the Official List of the FCA
Open Offer the conditional invitation to Qualifying
Shareholders to subscribe for the New
Shares at the Offer Price on the terms
and subject to the conditions set out
in the Prospectus and, in the case of
Qualifying Non-CREST Shareholders only,
the Application Form
Open Offer Entitlements entitlements to subscribe for the New
Shares, allocated to a Qualifying Shareholder
pursuant to the Open Offer
Overseas Shareholders Shareholders with registered addresses
in, or who are citizens, residents or
nationals of jurisdictions outside the
United Kingdom
Prospectus Delegated the Delegated Regulation (EU) 2019/980
Regulation of 14 March 2019 supplementing the Prospectus
Regulation
Prospectus Regulation the Prospectus Regulation (EU) 2017/1129
and amendments thereto
Prospectus Regulation the prospectus rules published by the
Rules FCA under section 73A of the FSMA
Qualifying CREST Shareholders Qualifying Shareholders holding Shares
in uncertificated form
Qualifying Non--CREST Qualifying Shareholders holding Shares
Shareholders in certificated form
Qualifying Shareholders Shareholders on the register of members
of the Company on the Record Date with
the exclusion of persons with a registered
address or located or resident in an Excluded
Territory (subject to certain exceptions)
Record Date 6.00 p.m. on 17 February 2021
Refinanced Facilities the bilateral revolving facility agreements
entered into between the Company, Mitchells
& Butlers Retail (No. 2) Limited, Barclays
Bank PLC, HSBC UK Bank plc and Santander
UK plc on 20 September 2017
Resolutions the resolutions to be proposed at the
General Meeting, as set out in the notice
at the back of the Prospectus
Santander Banco Santander, S.A.
Santander CLBILS the bilateral term facility agreement
(structured under the UK Government-backed
Coronavirus Large Business Interruption
Loan Scheme (the CLBILS) entered into
with Santander UK plc on 11 June 2020
Securities Act United States Securities Act of 1933,
as amended
Shareholder Undertaking the irrevocable undertaking given by each
of the members of the Odyzean Group to
the Company, dated 22 February 2021
Shareholders holders of Shares
Shares ordinary shares of 8 13/24 pence each
in the capital of the Company having the
rights set out in the Articles as described
in paragraph 4 of Part X - Additional
Information in the Prospectus
Sponsor Morgan Stanley
Takeover Code The City Code on Takeovers and Mergers
Trustee HSBC Trustee (C.I) Limited
UK Corporate Governance the UK Corporate Governance Code issued
Code by the Financial Reporting Council, as
amended from time to time
UK Government the Government of the United Kingdom
uncertificated or recorded on the register of members as
in uncertificated being held in uncertificated form in CREST
form and title to which, by virtue of the CREST
Regulations, may be transferred by means
of CREST
Underwriters Morgan Stanley, HSBC and Santander
Underwriting Agreement the underwriting agreement entered into
between the Company and the Underwriters
on 22 February 2021
United Kingdom or the United Kingdom of Great Britain and
UK Northern Ireland
United States or the United States of America, its territories
US and possessions, any state of the United
States and the District of Columbia
VAT (a) any tax charged in accordance with
the Value Added Tax Act 1994, as may be
amended or substituted from time to time;
(b) any tax imposed by any Member State
in conformity with the directive of the
council of the European Union on the common
system of value added tax (2006/112/EC);
and (c) any tax corresponding to, or substantially
similar to, the taxes referred to in paragraphs
(a) and (b) above of this definition
WBS Group Mitchells & Butlers Retail Holdings Limited
and Mitchells & Butlers Retail Limited
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February 22, 2021 02:00 ET (07:00 GMT)
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