TIDM44EB
RNS Number : 8328I
London & Quadrant Housing Trust
09 August 2023
THIS ANNOUNCEMENT RELATES TO THE DISCLOSURE OF INFORMATION THAT
QUALIFIED OR MAY HAVE QUALIFIED AS INSIDE INFORMATION FOR THE
PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014
AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION
(WITHDRAWAL) ACT 2018, AS AMED.
FOR DISTRIBUTION ONLY OUTSIDE THE UNITED STATES TO PERSONS OTHER
THAN "U.S. PERSONS" (AS DEFINED IN REGULATION S OF THE UNITED
STATES SECURITIES ACT OF 1933, AS AMED (THE SECURITIES ACT)). NOT
FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO, OR TO ANY
PERSON LOCATED OR RESIDENT IN, ANY OTHER JURISDICTION WHERE IT IS
UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT (SEE
"SOLICITATION AND DISTRIBUTION RESTRICTIONS" BELOW).
UK MIFIR PROFESSIONALS/ECPS-ONLY - MANUFACTURER TARGET MARKET
(UK MIFIR PRODUCT GOVERNANCE) IS ELIGIBLE COUNTERPARTIES AND
PROFESSIONAL CLIENTS ONLY (ALL DISTRIBUTION CHANNELS).
LONDON & QUADRANT HOUSING TRUST
(incorporated in England with limited liability under the
Co-operative and Community Benefit Societies Act 2014 with
registration number 30441R and registered with the Regulator of
Social Housing under the Housing and Regeneration Act 2008, as
amended by the Localism Act 2011, with number L4517)
announces consent solicitation in respect of the outstanding
GBP130,000,000 Guaranteed Secured Stepped Coupon Bonds due 2018
to 2033
(the Bonds )
of its subsidiary
QUADRANT HOUSING FINANCE LIMITED
(the Existing Issuer )
9 August 2023 . London & Quadrant Housing Trust (L&Q)
announces today an invitation (such invitation the Consent
Solicitation) to Eligible Bondholders (as defined below) to consent
to (i) the substitution of L&Q in place of the Existing Issuer
as issuer of the Bonds, (ii) the full and final release and
discharge of Ambac Assurance UK Limited (Ambac) from its guarantee
in respect of the Bonds, (iii) certain changes to the terms and
conditions of, and other documents relating to, the Bonds to align
the Bonds with the terms of L&Q's most recent bond issue and
(iv) the amendment of the security underlying the Bonds to
acknowledge that such security has been granted by L&Q in
respect of the Bonds and the partial release of such security from
time to time in compliance with the Asset Cover Test and Minimum
Performance Levels Test, all as proposed for approval by an
extraordinary resolution at a meeting of the holders of the Bonds,
(together, the Proposed Amendments) as further described in the
Consent Solicitation Memorandum (as defined below).
This announcement does not contain the full terms and conditions
of the Consent Solicitation, which are contained in the Consent
Solicitation Memorandum dated 9 August 2023 (the Consent
Solicitation Memorandum) prepared by L&Q, and this announcement
should be read in conjunction with the Consent Solicitation
Memorandum. Subject to the restrictions described under
"Solicitation and Distribution Restrictions" below, Eligible
Bondholders may obtain a copy of the Consent Solicitation
Memorandum from the Tabulation Agent, the contact details for which
are set out below. In order to receive a copy of the Consent
Solicitation Memorandum, a holder of the Bonds will be required to
provide confirmation as to his or her status as an Eligible
Bondholder. Eligible Bondholders are advised to read carefully the
Consent Solicitation Memorandum.
Capitalised terms used but not otherwise defined in this
announcement have the meanings given in the Consent Solicitation
Memorandum.
Details of the Bonds
Original Principal (Amortised) Outstanding
Amount of the Bonds Principal Amount
ISIN / Common Code Outstanding of the Bonds
------------------------ -------------------- -----------------------
GBP130,000,000 XS0084364016 / 008436401 GBP130,000,000 GBP102,053,120(1)
Guaranteed Secured
Stepped Coupon
Bonds due 2018
to 2033
1. At the time of the Meeting the (amortised) outstanding principal
amount of the Bonds is expected to be GBP98,613,580.00
Background to, and rationale for, the Consent Solicitation
The Bonds were originally issued in February 1998, and the net
proceeds from the issue of the Bonds were originally advanced by
the Existing Issuer to the former London & Quadrant Housing
Trust (Old L&Q) and to London & Quadrant Bexley Housing
Association Limited (L&Q Bexley) pursuant to the Loan
Agreement. Following an amalgamation between Old L&Q and
L&Q Bexley (amongst others) in March 2008 to form L&Q,
L&Q is now the sole borrower under the Loan Agreement. The
Bonds continue to be obligations of the Existing Issuer.
In the Consent Solicitation, L&Q is seeking to make the
Bonds direct obligations of L&Q with the objective of
simplifying its corporate and funding structure and aligning the
Bonds with the terms by which its most recent and existing listed
debt obligations have been issued and are governed.
Proposed Amendments
The Existing Issuer is convening a meeting (the Meeting) of the
holders of the Bonds (the Bondholders) for the approval by the
Eligible Bondholders, by an extraordinary resolution (the
Extraordinary Resolution), of the Proposed Amendments, as further
set out in the notice convening the Meeting published by the
Existing Issuer on the date of this announcement (the Notice).
The purpose of the Consent Solicitation and the Meeting is:
(i) to modify the terms and conditions of the Bonds (as set out
in the Third Schedule to the Existing Bond Trust Deed, the
Conditions), and the other documents relating to the Bonds, to
provide for:
(a) the substitution of L&Q in place of the Existing Issuer as issuer of the Bonds; and
(b) certain changes to the Conditions and the other documents
relating to the Bonds to align the Bonds with the terms of
L&Q's most recent bond issue;
(ii) to approve (a) the full and final release and discharge of
Ambac from any liabilities, actions, claims, promises, debts or
obligations that it may have under the financial guarantee
insurance policy dated 10 February 1998 and the endorsement thereto
issued by Ambac in respect of the Bonds (the Ambac Bond Policy),
and the cancellation of the AMBAC Bond Policy (the Ambac Release),
and (b) certain consequential amendments to the Conditions and
other documents relating to the Bonds to reflect the Ambac Release;
and
(iii) to approve the amendment of the security underlying the
Bonds to acknowledge that such security has been granted by L&Q
in respect of the Bonds and the partial release from time to time
of such security, provided that, notwithstanding any such release,
the value of the Charged Properties will at all times be at least
the requisite minimum to comply with the Asset Cover Test and
Minimum Performance Levels Test.
Further information in relation to the Consent Solicitation,
including in respect of the Proposed Amendments and the manner in
which the Proposed Amendments will be implemented, is set out in
the Consent Solicitation Memorandum.
Results of Consultation with a Special Committee of the
Investment Association
The Consent Solicitation has been considered by a Special
Committee (the Special Committee) consisting of Bondholders and
convened by The Investment Association (the IA) at the request of
L&Q. The members of the Special Committee, who hold in
aggregate approximately 71.62 per cent. of the aggregate original
principal amount of the Bonds currently outstanding, have examined
the Consent Solicitation, the Extraordinary Resolution and the
Proposed Amendments. They have informed L&Q that (i) they find
the Proposed Amendments acceptable; and (ii) subject to client and
other approvals (including those of each member of the Special
Committee's underlying investors) and each member of the Special
Committee exercising its voting rights in the best interests of its
underlying investors at the point of voting, they intend to vote in
favour of the Extraordinary Resolution in respect of their holdings
of the Bonds. As such, whilst each member of the Special Committee
has been asked to confirm, after due enquiry, the amount of its
holding of the Bonds that it will be able to commit to vote in
favour of the Extraordinary Resolution, any indication given by
such member of its intention to vote is not binding. The Special
Committee has advised L&Q that this relates only to the
proposals set out in the Consent Solicitation Memorandum with
respect to the Bonds and not to any future offers or proposals
which L&Q and/or the Existing Issuer may make.
Ambac Assurance UK Limited
Ambac has confirmed in writing to L&Q that, subject to
satisfaction of the Consent Conditions, it will enter into the
First Supplemental Trust Deed and the Amendment and Restatement
Deed following conclusion of the Meeting, in order to effect the
Ambac Release.
Eligible Bondholders
The Consent Solicitation is only being made, and the Consent
Solicitation Memorandum and any other documents or materials
relating to the Consent Solicitation are only for distribution or
to be made available, to each Bondholder who is (a) located and
resident outside the United States and not a U.S. person (as
defined in Regulation S under the Securities Act), (b) not a retail
investor (as defined under "Solicitation and Distribution
Restrictions" below) and, if applicable and acting on a
non-discretionary basis, who is acting on behalf of a beneficial
owner that is not a retail investor, and (c) otherwise a person to
whom the Consent Solicitation can be lawfully made and that may
lawfully participate in the Consent Solicitation (each an Eligible
Bondholder ).
Meeting
At the Meeting, Bondholders will be invited to consider and, if
thought fit, pass the Extraordinary Resolution to approve the
implementation of the Proposed Amendments, as more fully described
in the Consent Solicitation Memorandum and the Notice.
A person attending the Meeting via video conference or telephone
conference, as the case may be, shall be deemed to be present in
person at the Meeting, and all such references in the Consent
Solicitation Memorandum shall be construed accordingly. In order to
attend the Meeting via video conference, a Bondholder will need to
provide suitable identification documentation (including photo
identification) to the Tabulation Agent, following which the
Tabulation Agent will provide the Bondholder with details to access
the video conference (or, in the event a video conference is
unavailable, via telephone conference call).
Consent Conditions
The implementation of the Consent Solicitation and the
Extraordinary Resolution will be conditional on:
(a) the passing of the Extraordinary Resolution;
(b) the Consent Solicitation not having been terminated in accordance with its terms; and
(c) the quorum required for, and the requisite majority of votes
cast at, the Meeting being satisfied by Eligible Bondholders,
irrespective of any participation at the Meeting by Bondholders who
are not Eligible Bondholders (all such persons, Ineligible
Bondholders), as further described in the Consent Solicitation
Memorandum,
(together, the Consent Conditions).
Expiration Deadline
The Consent Solicitation commences on the date of this Consent
Solicitation Memorandum and expires at 5.00 p.m. (London time) on
29 August 2023 (such time and date as the same may be extended, the
Expiration Deadline). All Consent Instructions from Eligible
Bondholders wishing to vote in respect of the Extraordinary
Resolution must be received by the Tabulation Agent by the
Expiration Deadline.
No Fee
No consent or participation fee will be payable in connection
with the Consent Solicitation.
Ineligible Bondholders
An Ineligible Bondholder may deliver, or arrange to have
delivered on its behalf, a valid Ineligible Bondholder Confirmation
(as defined in the Notice) that is received by the Tabulation Agent
by 5.00 p.m. (London time) on 29 August 2023 and is not
subsequently revoked).
Timetable
The indicative timetable is summarised below:
Event Indicative Timetable
Announcement of Consent Solicitation 9 August 2023
and publication of Notice convening
the Meeting
Expiration Deadline 5.00 p.m. (London time) on 29
August 2023
Meeting 10.00 a.m. (London time) on 1
September 2023
Announcement of results of Meeting As soon as reasonably practicable
and satisfaction of Consent Conditions after the Meeting
Execution and delivery of the Amendment As soon as reasonably practicable
Documents, and implementation of after the Meeting
the Extraordinary Resolution
The above dates and times are subject to the right of L&Q to
extend, waive any condition (other than the Consent Conditions) of,
amend and/or terminate the Consent Solicitation (other than the
terms of the Extraordinary Resolution) as described in the Consent
Solicitation Memorandum and the passing of the Extraordinary
Resolution (and satisfaction of the Eligibility Condition) at the
initial Meeting. Accordingly, the actual timetable may differ
significantly from the timetable above.
Bondholders are advised to check with any bank, custodian,
securities broker or other intermediary through which they hold
their Bonds when such intermediary would need to receive
instructions from a Bondholder in order for such Bondholder to
participate in, or (in the circumstances in which revocation is
permitted) to validly revoke their instruction to participate in,
the Consent Solicitation and/or the Meeting before the deadlines
specified above. The deadlines set by any such intermediary and
each Clearing System for the submission and revocation of Consent
Instructions will be earlier than the relevant deadlines above.
Further details on the Consent Solicitation can be obtained
from:
SOLICITATION AGENTS
Barclays Bank PLC RBC Europe Limited
1 Churchill Place 100 Bishopsgate
London E14 5HP London EC2N 4AA
United Kingdom United Kingdom
Telephone: +44 20 3134 8515 Telephone: +44 20 7029 0165
Attention: Liability Management Group Attention: Liability Management
Email: eu.lm@barclays.com Email: liability.management@rbccm.com
Requests for documentation and information in relation to the
procedures for delivering Consent Instructions should be directed
to:
TABULATION AGENT
Kroll Issuer Services Limited
The Shard
32 London Bridge Street
London SE1 9SG
United Kingdom
Telephone: +44 20 7704 0880
Attention: Arlind Bytyqi
Email: lqgroup@is.kroll.com
Website: https://deals.is.kroll.com/lqgroup
None of the Solicitation Agents, the Tabulation Agent, the
Security Trustee, the Bond Trustee, the Principal Paying Agent,
Ambac or any of their respective directors, officers, employees,
agents, representatives or affiliates has been involved in the
formulation of, expresses any opinion on the merits of, or makes
any representation whatsoever regarding, the Consent Solicitation,
the Extraordinary Resolution or the Consent Solicitation Memorandum
or makes any recommendation as to whether Bondholders should
participate in the Consent Solicitation or otherwise participate at
the Meeting. None of the Security Trustee, the Bond Trustee, the
Principal Paying Agent and Ambac has reviewed this
announcement.
This announcement is released by London & Quadrant Housing
Trust and contains information that qualified or may have qualified
as inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018, as amended
(UK MAR), encompassing information relating to the Consent
Solicitation and the Proposed Amendments described above. For the
purposes of UK MAR and the Implementing Technical Standards, this
announcement is made by Martin Watts, Director of Treasury at
London & Quadrant Housing Trust.
DISCLAIMER : This announcement must be read in conjunction with
the Consent Solicitation Memorandum. This announcement and the
Consent Solicitation Memorandum contain important information which
should be read carefully before any decision is made with respect
to the Consent Solicitation or the Meeting. If any Bondholder is in
any doubt as to the action it should take or is unsure of the
impact of the implementation of the Extraordinary Resolution, it is
recommended to seek its own financial and legal advice, including
in respect of any tax consequences, immediately from its broker,
bank manager, solicitor, accountant or other independent financial,
tax or legal adviser. Any individual or company whose Bonds are
held on its behalf by a broker, dealer, bank, custodian, trust
company or other nominee or intermediary must contact such entity
if it wishes to participate in the Consent Solicitation or
otherwise participate at the Meeting. None of L&Q, the Existing
Issuer, the Solicitation Agents, the Tabulation Agent, the Security
Trustee, the Bond Trustee, the Principal Paying Agent or Ambac
expresses any opinion about the terms of the Consent Solicitation
or the Extraordinary Resolution or makes any recommendation as to
whether Bondholders should participate in the Consent Solicitation
or otherwise participate at the Meeting.
SOLICITATION AND DISTRIBUTION RESTRICTIONS
United States
The Consent Solicitation is only being made outside the United
States, to persons other than "U.S. persons" (as defined in
Regulation S under the Securities Act). Any purported participation
in the Consent Solicitation resulting directly or indirectly from a
violation of these restrictions will be invalid and any
participation in the Consent Solicitation by a person that is
located or resident in the United States or that is a U.S. person
or by any agent, fiduciary or other intermediary acting on a
non-discretionary basis for a beneficial owner that is giving
instructions from within the United States or that is any U.S.
person will not be accepted.
Neither this announcement nor the Consent Solicitation
Memorandum is an offer of securities for sale in the United States
or to any U.S. person. Securities may not be offered or sold in the
United States absent registration or an exemption from
registration. The Bonds have not been, and will not be, registered
under the Securities Act, or the securities laws of any state or
other jurisdiction of the United States, and may not be offered or
sold in the United States or to, or for the account or benefit of,
U.S. persons, unless an exemption from the registration
requirements of the Securities Act is available.
Each Bondholder participating in the Consent Solicitation will
represent that it is not a U.S. person (as defined in Regulation S
under the Securities Act), and is not acting for the account or
benefit of any U.S. person, and that it is not located or resident
in the United States.
For the purpose of this announcement and the Consent
Solicitation Memorandum, United States means the United States of
America, its territories and possessions (including Puerto Rico,
the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the
Northern Mariana Islands), any state of the United States of
America and the District of Columbia.
European Economic Area and United Kingdom
The Consent Solicitation is not being made to any "retail
investor" (as defined below). Each Bondholder participating in the
Consent Solicitation will represent that it is an Eligible
Bondholder, thereby confirming, inter alia, that it is not a retail
investor.
For the purposes of this announcement and the Consent
Solicitation Memorandum, a retail investor means a person who is
one (or more) of: (i) a retail client, as defined in point (8) of
Article 2 of Regulation (EU) No 2017/565 as it forms part of United
Kingdom domestic law by virtue of the EUWA, or (ii) a customer
within the meaning of the provisions of the FSMA and any rules or
regulations made under the FSMA to implement Directive (EU)
2016/97, where that customer would not qualify as a professional
client, as defined in point (8) of Article 2(1) of Regulation (EU)
No 600/2014 as it forms part of United Kingdom domestic law by
virtue of the EUWA.
UK MiFIR product governance / Professional investors and ECPs
only target market - Solely for the purposes of each manufacturer's
product approval process, the target market assessment in respect
of the Bonds has led to the conclusion that: (i) the target market
for the Bonds is only eligible counterparties, as defined in the
FCA Handbook Conduct of Business Sourcebook (COBS), and
professional clients, as defined in Regulation (EU) No 600/2014 as
it forms part of United Kingdom domestic law by virtue of the
European Union (Withdrawal) Act 2018, as amended (the EUWA); and
(ii) all channels for distribution of the Bonds to eligible
counterparties and professional clients are appropriate. Any person
subsequently offering, selling or recommending the Bonds (a
distributor) should take into consideration the manufacturers'
target market assessment; however, a distributor subject to the FCA
Handbook Product Intervention and Product Governance Sourcebook is
responsible for undertaking its own target market assessment in
respect of the Bonds (by either adopting or refining the
manufacturers' target market assessment) and determining
appropriate distribution channels.
General
Nothing in this announcement or the Consent Solicitation
Memorandum constitutes or contemplates an offer of, an offer to
purchase or the solicitation of an offer to sell any security in
any jurisdiction and participation in the Consent Solicitation by a
Bondholder in any circumstances in which such participation is
unlawful will not be accepted.
The distribution of this announcement and the Consent
Solicitation Memorandum in certain jurisdictions may be restricted
by law, and persons into whose possession this announcement or the
Consent Solicitation Memorandum comes are requested to inform
themselves about, and to observe, any such restrictions.
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END
MSCBBGDICUGDGXC
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