TIDMBREE
RNS Number : 0996L
Breedon Group PLC
17 April 2018
17 April 2018
Breedon Group plc
("Breedon")
Acquisition of Lagan Group (Holdings) Limited
Placing to raise approximately GBP170 million
Breedon announces that it has entered into a conditional
agreement to acquire Lagan Group (Holdings) Limited ("Lagan"), a
leading construction materials business based in Belfast, for a
cash consideration of GBP455 million* on a cash- and debt-free
basis (the "Acquisition"). The combination of Breedon and Lagan
will create a leading independent construction materials group in
the UK and Ireland, and extend Breedon's geographic footprint with
immediate critical mass in Ireland and across the entire value
chain. The Acquisition also provides Breedon with an enhanced
platform for further organic growth and bolt-on acquisitions.
Transaction highlights
-- Breedon has agreed to acquire Lagan for GBP455 million* on a cash- and debt-free basis. The consideration will be payable to the sellers on Completion
-- Lagan is a leading supplier of construction materials and
contract surfacing in Ireland and the UK with a modern cement plant
in Kinnegad, nine active quarries, 13 asphalt plants and nine
ready-mixed concrete plants
-- In the year ended 31 December 2017, Lagan generated revenues
of GBP249 million and EBITDA of GBP46 million
-- The consideration will be financed by a combination of a new
GBP150 million term loan, a new GBP350 million revolving credit
facility which replaces Breedon's existing GBP300 million revolving
facility and a GBP170 million equity placing (the "Placing")
-- The Acquisition enables Breedon to enter the attractive Irish
construction market and provides significant opportunities to
expand upstream though the aggregates business in Ireland and
downstream through the asphalt and ready-mixed concrete
operations
-- Breedon expects to achieve annual cost synergies of
approximately GBP5 million by the third full year following
Completion
-- The Acquisition is expected to be double-digit accretive to
Underlying EPS in the first full year following Completion**
* Based on locked-box accounts at 31 December 2017
**This should not be construed as a profit forecast and should
therefore not be interpreted to mean that earnings per share in any
future financial period will necessarily match or be greater than
those for the relevant preceding financial period.
-- The placing will raise gross proceeds of approximately GBP170
million through the issue of 222,222,222 new Ordinary Shares (the
"Placing Shares") at 76.5 pence per share (the "Placing Price")
-- Of the Placing Shares, 65,488,454 new Ordinary Shares (the
"Clawback Placing Shares") have been placed subject to a right of
recall to satisfy allocations under the Clawback Placing also
announced today by Breedon, the terms and conditions of which are
set out in this Announcement
-- Breedon also intends to raise up to approximately GBP4
million through the issue of 5,542,967 new Ordinary Shares pursuant
to an open offer (the "Open Offer"), to allow Breedon shareholders
who are not participating in the Placing to subscribe for new
Ordinary Shares at the Placing Price
-- Breedon's pro forma net debt is expected to be approximately
2.6x Underlying EBITDA at Completion. Leverage is expected to fall
to less than 1x in 2020
Peter Tom CBE, Breedon's Executive Chairman, commented:
"We are delighted to have completed our largest acquisition to
date and particularly pleased that it has been so strongly
supported by our shareholders.
"Over the last eight years we have pursued a successful
buy-and-build strategy which has established Breedon as the largest
independent construction materials business in the UK and the
acquisition of Lagan is another strategic step for us. We believe
it has the potential to add significantly to the Group's
performance and prospects and we are looking forward to working
with our new colleagues to deliver further value for our
investors."
Pat Ward, Breedon's Group Chief Executive, added:
"Lagan represents a unique opportunity to enter a growing market
with immediate scale and excellent opportunities for expansion. It
significantly strengthens our cement offer, adds to our mineral and
downstream resources, brings us a bitumen import/export business
and adds real weight to our contract surfacing operations.
"Lagan is well-run, well-invested, with an experienced
management team and a strong track record. Its culture is
complementary to our own, with a sharp focus on customer service, a
first-class workforce and a commitment to safety, which is a key
priority for us.
"From a strategic perspective, it provides us with a stronger
platform from which to pursue further organic growth and bolt-on
acquisitions."
Kevin Lagan, Chairman of Lagan Group, said:
"I'd like to thank our committed and passionate staff for the
role they have played in the growth of Lagan Group and I wish them
every success as they enter an exciting new chapter with Breedon,
who I am confident will build on that success, supporting the
development of the business in the years ahead."
- ends -
Note to editors
Following the acquisition of Lagan, Breedon Group plc will be a
leading construction materials group in the UK and Ireland. It will
operate two cement plants, around 70 quarries, 40 asphalt plants,
200 ready-mixed concrete and mortar plants, nine concrete and clay
products plants, four contract surfacing businesses, six
import/export terminals and two slate production facilities.
The Group will employ nearly 3,000 people and have around 870
million tonnes of mineral reserves and resources. The Group's
strategy is to continue growing organically and through the
acquisition of businesses in the heavyside construction materials
market.
Webcast for analysts and investors
Breedon will host a meeting for invited analysts at 9.00am today
at Travers Smith LLP, 2-3 Hosier Lane, London EC1 and there will be
a simultaneous webcast of the meeting. Please use this link to join
the webcast:
http://webcasting.brrmedia.co.uk/broadcast/5acf2c6d5a296618f1792643
The webcast will also be available to view on our website later
today at www.breedongroup.com/investors and the presentation can
also be viewed or downloaded from the same location from 8.55am
today.
The information contained within this announcement is deemed by
the Group to constitute inside information under the Market Abuse
Regulations (EU) No. 596/2014.
Enquiries:
Breedon Group plc Tel: 01332 694444
Peter Tom, Executive Chairman
Pat Ward, Group Chief Executive
Rob Wood, Group Finance Director
Stephen Jacobs, Head of Communications Tel: 07831 764592
Moelis & Company (Financial Adviser to Breedon) Tel: 020 7634
Mark Aedy 3500
Liam Beere
Rich Newman
Cenkos Securities (NOMAD and Joint Broker Tel: 020 7397
to Breedon) 8900
Max Hartley
Oliver Goad
Numis Securities (Joint Broker to Breedon) Tel: 020 7260
Heraclis Economides 1000
Ben Stoop
IMPORTANT NOTICES
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
CLAWBACK PLACING. THIS ANNOUNCEMENT (INCLUDING THE APPIX) AND THE
TERMS AND CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT")
ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM
IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS
PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE:
(1) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"),
QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(1)(e) OF DIRECTIVE
2003/71/EC AS AMED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE
AMING DIRECTIVE (DIRECTIVE 2010/73/EC) AND TO THE EXTENT
IMPLEMENTED IN THE RELEVANT MEMBER STATE (THE "PROSPECTUS
DIRECTIVE"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO
(A) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS
ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMED (THE "ORDER")
(INVESTMENT PROFESSIONALS) OR (B) FALL WITHIN ARTICLE 49(2)(a) TO
(d) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.)
OF THE ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS
"RELEVANT PERSONS").
THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON
OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO. 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. THIS ANNOUNCEMENT
DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY
SECURITIES IN BREEDON GROUP PLC.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (THE
"SECURITIES ACT") OR WITH ANY SECURITIES REGULATORY AUTHORITY OF
ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE
OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION OF THE UNITED STATES. THE PLACING SHARES ARE
BEING OFFERED AND SOLD ONLY OUTSIDE OF THE UNITED STATES IN
"OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE
WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN
ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING
SHARES IS BEING MADE IN THE UNITED STATES OR ELSEWHERE.
THIS ANNOUNCEMENT (INCLUDING THE APPIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF
SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH
RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
The distribution of this Announcement and/or the Placing and/or
issue of the Placing Shares in certain jurisdictions may be
restricted by law. No action has been taken by the Company, the
Joint Bookrunners or any of their respective affiliates, agents,
directors, officers or employees that would permit an offer of the
Placing Shares or possession or distribution of this Announcement
or any other offering or publicity material relating to such
Placing Shares in any jurisdiction where action for that purpose is
required. Persons into whose possession this Announcement comes are
required by the Company and the Joint Bookrunners to inform
themselves about and to observe any such restrictions.
This Announcement or any part of it is for information purposes
only and does not constitute or form part of any offer to issue or
sell, or the solicitation of an offer to acquire, purchase or
subscribe for, any securities in the United States (including its
territories and possessions, any state of the United States and the
District of Columbia (the "United States" or the "US")), Australia,
Canada, the Republic of South Africa or Japan or any other
jurisdiction in which the same would be unlawful. No public
offering of the Placing Shares is being made in any such
jurisdiction.
All offers of the Placing Shares in the EEA will be made
pursuant to an exemption under the Prospectus Directive from the
requirement to produce a prospectus. In the United Kingdom, this
Announcement is being directed solely at persons in circumstances
in which section 21(1) of the Financial Services and Markets Act
2000 (as amended) does not apply.
The Placing Shares have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States. The relevant clearances have not
been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged
with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the Placing Shares 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, the Republic of South Africa or
Japan.
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, the Republic of South Africa or Japan or any other
jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligations to forward
a copy of this Announcement should seek appropriate advice before
taking any action.
By participating in the Placing, each person who is invited to
and who chooses to participate in the Placing (a "Placee") by
making an oral and legally binding offer to acquire Placing Shares
will be deemed to have read and understood this Announcement in its
entirety, to be participating, making an offer and acquiring
Placing Shares on the terms and conditions contained herein and to
be providing the representations, warranties, indemnities,
acknowledgements and undertakings contained in the Appendix.
This Announcement may contain and the Company may make verbal
statements containing "forward-looking statements" with respect to
certain of the Company's plans and its current goals and
expectations relating to its future financial condition,
performance, strategic initiatives, objectives and results.
Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "seek", "may", "could", "outlook" or other words
of similar meaning. By their nature, all forward-looking statements
involve risk and uncertainty because they relate to future events
and circumstances which are beyond the control of the Company,
including amongst other things, United Kingdom domestic and global
economic business conditions, market-related risks such as
fluctuations in interest rates and exchange rates, the policies and
actions of governmental and regulatory authorities, the effect of
competition, inflation, deflation, the timing effect and other
uncertainties of future acquisitions or combinations within
relevant industries, the effect of tax and other legislation and
other regulations in the jurisdictions in which the Company and its
affiliates operate, the effect of volatility in the equity, capital
and credit markets on the Company's profitability and ability to
access capital and credit, a decline in the Company's credit
ratings; the effect of operational risks; and the loss of key
personnel. As a result, the actual future financial condition,
performance and results of the Company may differ materially from
the plans, goals and expectations set forth in any forward-looking
statements. Any forward-looking statements made in this
Announcement by or on behalf of the Company speak only as of the
date they are made. Except as required by applicable law or
regulation, the Company expressly disclaims any obligation or
undertaking to publish any updates or revisions to any
forward-looking statements contained in this Announcement to
reflect any changes in the Company's expectations with regard
thereto or any changes in events, conditions or circumstances on
which any such statement is based.
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 (a) retail investors, (b) investors who meet the
criteria of professional clients and (c) 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 Placing
Shares may decline and investors could lose all or part of their
investment; the Placing Shares offer no guaranteed income and no
capital protection; and an investment in the Placing 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 Joint
Bookrunners 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.
Moelis & Company UK LLP ("Moelis & Company"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting exclusively as financial adviser to Breedon and no-one else
in connection with the Acquisition and will not be responsible to
anyone other than Breedon for providing the protections afforded to
clients of Moelis & Company nor for providing advice in
connection with the Acquisition or any matter referred to
herein.
Cenkos Securities plc ("Cenkos Securities") which is authorised
and regulated in the United Kingdom by the FCA, is acting solely
for Breedon in relation to the Placing and no-one else and will not
be responsible to anyone other than Breedon for providing the
protections afforded to clients of Cenkos Securities nor for
providing advice in relation to the Placing or any other matter
referred to in this Announcement.
Numis Securities Limited ("Numis Securities") which is
authorised and regulated in the United Kingdom by the FCA, is
acting solely for Breedon in relation to the Placing and no-one
else and will not be responsible to anyone other than Breedon for
providing the protections afforded to clients of Numis Securities
nor for providing advice in relation to the Placing or any other
matter 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 the Joint Bookrunners, Moelis &
Company or by any of their respective affiliates or agents 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.
No statement in this Announcement is intended to be a profit
forecast or estimate, 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.
The price of shares and any income expected from them may go
down as well as up and investors may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance, and persons needing advice should consult an
independent financial adviser.
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.
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.
1. Introduction
Breedon announces that it has entered into a conditional
agreement to acquire Lagan Group (Holdings) Limited ("Lagan"), a
leading construction materials business based in Belfast, for a
cash consideration of GBP455 million* on a cash- and debt-free
basis (the "Acquisition"). The consideration will be payable to the
sellers on Completion. The combination of Breedon and Lagan will
create a leading independent construction materials group in the UK
and Ireland, and extend Breedon's geographic footprint with
immediate critical mass in Ireland and across the entire value
chain. The Acquisition also provides Breedon with an enhanced
platform for further organic growth and bolt-on acquisitions.
2. Information on Lagan
Lagan is a leading supplier of construction materials and
contract surfacing in Ireland and the UK, supplying a range of bulk
and bagged cement, aggregates, asphalt and bitumen, with services
ranging from road surfacing and maintenance to airfield surfacing.
Founded in 1960, Lagan is one of the largest privately-owned
companies in Ireland, employing approximately 750 people.
Lagan's assets include: a modern cement manufacturing facility,
nine active quarries across the UK & Ireland (including the
Welsh Slate business), 13 asphalt plants, nine ready-mixed concrete
plants, a brick manufacturing plant, four port terminals (one for
cement export, one for aggregates export and two for bitumen import
& export) and a share in a bitumen vessel.
In the year ended 31 December 2017, Lagan generated revenue of
GBP249 million, EBITDA of GBP46 million and profit before tax of
GBP21 million. As at 31 December 2017, Lagan had pro forma net
assets of GBP156 million.
3. Information on Breedon
Breedon is the largest independent construction materials group
in the UK after the four global majors. It operates a cement plant,
around 60 quarries, 26 asphalt plants, nearly 200 ready-mixed
concrete and mortar plants and four concrete products plants
nationwide, employing around 2,200 people. Breedon has strong asset
backing, with around 750 million tonnes of mineral reserves and
resources. Breedon's strategy is to continue growing through
organic improvement and acquisition of businesses in the heavyside
construction materials market.
In the year ended 31 December 2017, Breedon sold 16.0 million
tonnes of aggregates, 1.9 million tonnes of asphalt and 3.3 million
cubic metres of concrete. In the same period Breedon generated
revenue of GBP652 million, Underlying EBITDA of GBP117 million and
profit before tax of GBP71 million.
Breedon's Ordinary Shares are admitted to trading on the AIM
market of the London Stock Exchange.
4. Strategic rationale for the Acquisition
Expansion into the attractive Irish construction market
Lagan's strong presence as a leading supplier of construction
materials and services in Ireland complements Breedon's existing
footprint in the UK. The strategic entry into Ireland secures
immediate critical mass across the entire value chain and will
allow Breedon to service an attractive market with a strong growth
outlook for the Irish construction sector.
* Based on locked-box accounts at 31 December 2017
Increased scale and enhanced market position
The Acquisition creates a leading independent construction
materials group in the UK and Ireland.
The Enlarged Group will have: two cement manufacturing plants,
69 quarries, 39 asphalt plants, approximately 200 ready-mixed
concrete and mortar plants, six import/export terminals, eight
rail-fed depots and four contract surfacing businesses.
In the year ended 31 December 2017, the Enlarged Group would
have reported pro forma revenue of GBP901 million and pro forma
Underlying EBITDA of GBP163 million.
Further consolidation of the UK and Irish heavyside construction
materials sectors
As a result of sector consolidation over the last 15 years or
so, international cement companies now account for the vast
majority of the UK heavyside building materials industry.
The combination of Breedon and Lagan brings together two
sizeable companies in this sector in the UK and RoI and, in line
with Breedon's strategy, further consolidates the UK and RoI
heavyside construction materials industry. With the significantly
enhanced platform created by this Acquisition, and with the smaller
end of the sector remaining highly fragmented, there are further
consolidation opportunities for the Enlarged Group in the
future.
Improved and broadened product mix
The Acquisition provides a range of complementary products and
services that will enable Breedon to strengthen its core product
offering. In addition to aggregates, asphalt, ready-mixed concrete
and bitumen, Lagan adds bricks, a range of concrete and clay
products and Welsh slate to Breedon's existing portfolio.
Lagan also brings with it a substantial contract surfacing and
road maintenance business which will significantly increase the
scale of Breedon's existing contract surfacing operations and
enable the Enlarged Group to provide solutions to larger surfacing
and road maintenance projects.
Cost synergies
Breedon expects to achieve annual cost synergies of
approximately GBP5 million from operational improvements by the
third full year following Completion. One-off integration costs to
achieve these savings are expected to be approximately GBP4
million.
5. Key terms of the Acquisition
Under the terms of the sale and purchase agreement relating to
the Acquisition (the "SPA"), Breedon Holdings (Jersey) Limited, a
wholly-owned subsidiary of Breedon, will acquire the entire issued
share capital of Lagan for a purchase price of GBP455 million on a
cash- and debt-free basis. The consideration will be payable to the
sellers on Completion. Completion is conditional on, and is
expected to occur within one Business Day of, Admission.
The SPA also contains customary warranties, covenants,
undertakings and conditions for a transaction of this nature.
6. Financing for the Acquisition
The consideration will be financed by a combination of a new
term loan, a new revolving credit facility and the net proceeds of
the Placing.
At the time of signing the SPA, Breedon entered into a new
GBP500 million term and revolving credit facility agreement with
Barclays Bank PLC, HSBC Bank plc, The Royal Bank of Scotland plc,
Santander UK plc and AIB Group (UK) PLC (t/a First Trust Bank). The
new facility replaces Breedon's existing GBP300 million revolving
credit facility and has a four-year term with an option to extend
by one year (in respect of the GBP350 million revolving facility
only; the GBP150 million term facility amortises fully over the
four-year term) and a GBP100 million accordion option. The pricing
is marginally better than Breedon's existing revolving credit
facility.
7. The Placing
The Placing Shares have been conditionally placed by Cenkos
Securities and Numis Securities, as agents for Breedon, with
existing institutional and other investors at the Placing Price in
accordance with the terms of the Placing Agreement. Breedon intends
to use the net proceeds of the Placing to part-fund the cash
consideration payable under the terms of the SPA.
Of the Placing Shares, 65,488,454 new Ordinary Shares (the
"Clawback Placing Shares") have been placed subject to a right of
recall to satisfy allocations under the Clawback Placing which will
be launched immediately following this Announcement. The Clawback
Placing is subject to the terms and conditions set out in the
appendix of this Announcement. The remaining 156,733,768 Placing
Shares (the "Firm Placing Shares") have been placed firm and are
not subject to clawback.
Cenkos Securities and Numis Securities will today commence a
bookbuilding process in respect of the Clawback Placing Shares. The
Clawback Placing Shares will be placed at the Placing Price. The
timing of the closing of the book and allocations are at the
absolute discretion of Cenkos Securities, Numis Securities and
Breedon. Regardless of the take-up of the Clawback Placing Shares,
the full number of Placing Shares will be allotted pursuant to the
Placing Agreement.
The issue of the Placing Shares is to be effected by way of a
cashbox placing. Breedon will allot and issue the Placing Shares on
a non-pre-emptive basis to the Placees in consideration for Cenkos
Securities transferring its holdings of redeemable preference
shares and ordinary subscriber shares in Lisbon Funding Limited
("JerseyCo") to Breedon.
The Placing is not underwritten and is not conditional on
Completion. The Placing Agreement contains certain warranties and
indemnities from Breedon in favour of Cenkos Securities and Numis
Securities, and is conditional, inter alia, upon:
(a) certain announcement obligations;
(b) the SPA having become unconditional in all respects (save in
relation to any condition relating to the Placing Agreement
becoming unconditional and Admission) and not being terminated in
accordance with its terms;
(c) the Facility Agreement having become unconditional in all
respects (save in respect of any condition relating to the Placing
Agreement becoming unconditional, Admission and the completion of
the SPA) and not being terminated in accordance with its terms;
(d) the warranties contained in the Placing Agreement not being
breached (save where such breach is not considered by the Joint
Bookrunners, acting jointly and in good faith, to be material in
the context of the Placing) when made at the date of the Placing
Agreement and at Admission by reference to the facts and
circumstances subsisting at the time;
(e) the Company complying with its obligations under the Placing
Agreement in all material respects to the extent that they fall to
be performed on or before Admission; and
(f) Admission becoming effective in accordance with the AIM
Rules for Companies by no later than 8.00 a.m. on 19 April 2018 (or
by such later date as the Company and the Joint Bookrunners (acting
jointly) may agree in writing, being no later than 8.00 a.m. on 30
April 2018.
In the unlikely event that the Acquisition does not complete in
circumstances where Admission has already taken place, the Board's
current intention is that the net proceeds of the Placing will be
invested and/or applied for general corporate purposes and, where
possible, financing other acquisition opportunities that fulfil the
Company's strategic objectives.
The Placing Shares will represent approximately 15.4 per cent of
Breedon's current issued share capital and approximately 13.3 per
cent of the Enlarged Share Capital of Breedon following Admission
and Completion. The Placing Shares will, following Admission, rank
in full for all dividends and distributions declared, made or paid
in respect of the issued ordinary share capital of Breedon and
otherwise rank pari passu in all other respects with the existing
Ordinary Shares. The Placing Price represents a 2.3 per cent
discount to the closing mid-market price of 78.3 pence per Ordinary
Share on 16 April 2018 (being the latest practicable date prior to
the date of this Announcement).
8. Open Offer
The Board is pleased to provide Qualifying Shareholders with the
opportunity to participate in the Open Offer at the Placing Price
to raise approximately GBP4 million (assuming full take up of the
Open Offer but being less than the EUR5 million maximum amount
permitted without requiring publication of a prospectus under the
Prospectus Rules). The Open Offer is in addition to and separate
from the Placing. The Open Offer is conditional upon (amongst other
things) Completion and is not being underwritten.
The Directors are fully supportive of the Open Offer and the
Directors who are Qualifying Shareholders (other than one of the
non-executive Directors) have therefore indicated their intention
to participate in part or in full in the Open Offer in respect of
their respective Basic Entitlements, which amount to 190,496 Open
Offer Shares in aggregate. However, the Directors who are
Qualifying Shareholders are willing to be scaled back by other
Qualifying Shareholders under the Excess Application Facility to
accommodate demand from other Qualifying Shareholders.
Qualifying Shareholders are also being given the opportunity,
provided they take up their Basic Entitlements in full, to apply
for Excess Entitlements through the Excess Application Facility,
further details of which are set out below.
Qualifying Shareholders with holdings of Existing Shares in both
certificated and uncertificated form will be treated as having
separate holdings for the purpose of calculating their Open Offer
Entitlements.
Entitlements of Qualifying Shareholders will be rounded down to
the nearest whole number of Open Offer Shares. Fractional
entitlements which would otherwise arise will not be issued to the
Qualifying Shareholders but will made available under the Excess
Application Facility.
The Excess Application Facility enables Qualifying Shareholders
to apply for Open Offer Shares in excess of their Basic Entitlement
as at the Record Date.
However, applications for Excess Entitlements will be satisfied
only and to the extent that corresponding applications by other
Qualifying Shareholders are not made or are made for less than
their Basic Entitlements and may be scaled back at Breedon's
absolute discretion. No assurance can be given that applications by
Qualifying Shareholders under the Excess Application Facility will
be met in full, in part or at all.
In any event, applications will be rejected if acceptance would
result in the Qualifying Shareholder, together with those acting in
concert with him for the purposes of the City Code on Takeovers and
Mergers, holding 30 per cent. or more of the Ordinary Shares in
issue immediately following Admission.
Qualifying Non-CREST Shareholders who wish to apply to acquire
more than their Basic Entitlements should complete the relevant
sections on the Application Form. Qualifying CREST Shareholders
will have Excess Entitlements credited to their stock account in
CREST and should refer to the Circular for information on how to
apply for Excess Entitlements pursuant to the Excess Application
Facility.
The Circular contains the full terms and conditions of the Open
Offer.
9. Financial effects of the Acquisition
The Acquisition will significantly increase Breedon's scale and
profitability, bringing into the Group a business that generated
revenue of GBP249 million and EBITDA of GBP46 million in the year
ended 31 December 2017. In addition, Breedon expects to achieve
annual cost synergies of approximately GBP5 million by the third
full year following Completion.
The Acquisition is expected to be double-digit accretive to
Breedon's Underlying EPS in the first full year following
Completion.**
Breedon's pro forma net debt is expected to be approximately
2.6x Underlying EBITDA at Completion. Leverage is expected to fall
to less than 1x in 2020. The Enlarged Group's strong balance sheet
and expected increased future cash flow will provide it with the
financial flexibility to pursue further bolt-on acquisitions and
future growth opportunities.
10. Board, management and employees
Breedon greatly values the skills, knowledge and expertise of
Lagan's existing management team and employees. Lagan's experienced
management team will continue to drive growth in Ireland, supported
by Breedon's existing management team.
11. Strategy of the Enlarged Group
The strategy of the Enlarged Group will remain consistent with
Breedon's current strategy of pursuing a well-planned combination
of organic growth and continuing consolidation of the UK and Irish
heavyside construction materials industry. Breedon's objective
remains to be the safest and most profitable construction materials
company in the UK and Ireland market through:
-- striving for best customer service;
-- delivering continuous organic improvement;
-- securing value-enhancing acquisitions; and
-- doing all these things safely.
12. Interim results
In light of the acquisition of Lagan, and in order to allow time
for the first phase of its integration into the Group to be
completed, it has been decided to reschedule the announcement of
Breedon's interim results from mid-July to 5 September 2018. This
will apply to the current year only. In 2019 Breedon will resume
its customary practice of reporting in mid-July.
** This should not be construed as a profit forecast and should
therefore not be interpreted to mean that earnings per share in any
future financial period will necessarily match or be greater than
those for the relevant preceding financial period.
13. Trading update for underlying Breedon business
In common with the rest of our industry, we have experienced
disruption from the severe weather in the first quarter which has
impacted the phasing of some of our work. However, with the worst
of the weather behind us, we have seen an improvement in recent
weeks and anticipate a continuing recovery in activity. The Board's
expectation for the full year remains unchanged.
14. Total Voting Rights
Application has been made for the Placing Shares to be admitted
to trading on AIM. The Placing Shares will rank pari-passu with
existing Ordinary Shares and it is expected that Admission will
occur at 8.00 a.m. on or around 19 April 2018.
Following Admission, Breedon's issued ordinary share capital
will comprise 1,668,936,659 Ordinary Shares, of which none are held
in treasury. Therefore, the total number of Ordinary Shares with
voting rights in Breedon following Admission will be
1,668,936,659.
The above figure of 1,668,936,659 may be used by shareholders as
the denominator for the calculations by which they will determine
if they are required to notify their interest in, or a change to
their interest in Breedon under the FCA's Disclosure Guidance and
Transparency Rules.
15. Definitions
The following words and expressions shall have the following
meanings in this Announcement unless the context otherwise
requires:
"Acquisition" the proposed acquisition by Breedon
of Lagan
"Admission" the admission to trading on AIM of the
Placing Shares becoming effective in
accordance with Rule 6 of the AIM Rules
"AIM" the AIM Market of the London Stock Exchange
"AIM Rules" the rules for AIM companies as published
by the London Stock Exchange from time
to time
"Announcement" this announcement and the Appendix
"Basic Entitlement" the basic entitlement to subscribe for
Open Offer Shares, allocated to a Qualifying
Shareholder pursuant to the Open Offer
"Board of Directors" or the directors of Breedon
"Directors"
"Breedon" or the "Company" Breedon Group plc, a company registered
in Jersey with a registered number 98465
"Cenkos Securities" Cenkos Securities plc
"Circular" the shareholder circular relating to
the Open Offer to be published on the
date of this Announcement
"Clawback Placing" the right of recall in respect of the
Clawback Placing Shares to satisfy allocations
under the bookbuilding process being
launched today
"Clawback Placing Shares" 65,488,454 Ordinary Shares
"Completion" completion of the Acquisition
"CREST" the computer system (as defined in the
CREST Regulations) in respect of which
Euroclear is the recognised operator
(as defined in those regulations)
"EBITDA" earnings before interest, tax, depreciation
and amortisation
"Enlarged Group" Breedon and its subsidiary undertakings,
including Lagan, following Completion
"Enlarged Share Capital" the issued ordinary share capital of
Breedon immediately following Completion
and the Placing
"EPS" earnings per share
"Excess Entitlements" an entitlement for each Qualifying Shareholder
to apply to subscribe for Open Offer
Shares in addition to his Basic Entitlement
pursuant to the Excess Application Facility
which is conditional on him taking up
his Basic Entitlement in full and which
may be subject to scaling back in accordance
with the provisions of the Circular
"Existing Shares" the Ordinary Shares in issue at the
Record Date
"Facility Agreement" the term loan and revolving credit facility
agreement between the Company, Barclays
Bank PLC, HSBC Bank plc, The Royal Bank
of Scotland plc, Santander UK plc and
AIB Group (UK) PLC (t/a First Trust
Bank) dated 17 April 2018
"Joint Bookrunners" Cenkos Securities and Numis Securities
"Lagan" Lagan Group (Holdings) Limited
"Moelis & Company" Moelis & Company UK LLP
"Numis Securities" Numis Securities Limited
"Open Offer" the invitation by the Company to Qualifying
Shareholders to apply to subscribe for
the Open Offer Shares at the Placing
Price on the terms and subject to the
conditions set out in the Circular
"Open Offer Entitlements" the Basic Entitlements and Excess Entitlements
"Ordinary Shares" ordinary shares of no par value in the
share capital of Breedon
"Placee" each person who is invited to and who
chooses to participate in the Placing
"Placing" the placing of new Ordinary Shares pursuant
to the Placing Agreement
"Placing Agreement" the placing agreement entered into between
Breedon and Cenkos Securities and Numis
Securities on 17 April 2018
"Placing Price" 76.5 pence per Placing Share
"Placing Shares" 222,222,222 Ordinary Shares
"Qualifying CREST Shareholders" Qualifying Shareholders holding Existing
Shares in uncertificated form
"Qualifying Non-CREST Qualifying Shareholders holding Existing
Shareholders" Shares in certificated form
"Qualifying Shareholders" holders of Existing Shares on the register
of members of the Company at the Record
Date but excluding any non-exempt overseas
shareholder in a Restricted Jurisdiction
"Record Date" 13 April 2018
"Restricted Jurisdiction" United States, Canada, Australia, the
Republic of South Africa or Japan
"RoI" Republic of Ireland
"SPA" the sale and purchase agreement entered
into between Breedon, Breedon Holdings
(Jersey) Limited, Kevin Lagan and the
other Sellers (as defined therein) and
Lagan setting out the terms and conditions
of the Acquisition
"Underlying EBITDA" EBITDA before acquisition-related expenses,
redundancy and reorganisation costs,
"Underlying EPS" property items, amortisation of acquisition
intangibles and related tax items
EPS before acquisition-related expenses,
redundancy and reorganisation costs,
property items, amortisation of acquisition
intangibles and related tax items
"UK" or "United Kingdom" the United Kingdom of Great Britain
and Northern Ireland
EXPECTED TIMETABLE OF OPEN OFFER
2018
Record Date and time for entitlement under 5.30 p.m. on 13
the Open Offer April
Announcement of the Placing, the Acquisition 17 April
and the Open Offer
Publication of the Circular and, to Qualifying 17 April
Non-Crest Shareholders, the Application Form
"Ex" entitlement date of the Open Offer 17 April
Open Offer Entitlements credited to stock by 18 April
accounts in CREST of Qualifying CREST Shareholders
Latest recommended time and date for requested 4.30 p.m. on 2 May
withdrawal of Open Offer Entitlements from
CREST
Latest time and date for depositing Open Offer 3.00 p.m. on 3 May
Entitlements in CREST
Latest time and date for splitting Application 3.00 p.m. on 4 May
Forms (to satisfy bona fide market claims)
Latest time and date for receipt of Application 11.00 a.m. on 9
Forms and payment in full under the Open Offer May
and settlement of relevant CREST instructions
(as appropriate)
Results of the Open Offer announced 11 May
Admission and dealings in the Open Offer Shares 8.00 a.m. on 14
expected to commence on AIM May
Expected date for CREST accounts to be credited 14 May
in respect of Open Offer Shares in uncertificated
form (where applicable)
Expected date for despatch of share certificates within 14 days of
for Open Offer Shares in certificated form Admission
(where applicable)
Notes
Each of the times and dates above are indicative only and if
any of the details contained in the timetable above should change,
the revised times and dates will be notified to Shareholders
by means of an announcement through a Regulatory Information
Service. References to time in this Announcement are to London
time, unless otherwise stated.
APPIX - TERMS AND CONDITIONS OF THE CLAWBACK PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
CLAWBACK PLACING.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
CLAWBACK PLACING. THIS ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE
TERMS AND CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT")
ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM
IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS
PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE:
(1) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"),
QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(1)(e) OF DIRECTIVE
2003/71/EC AS AMED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE
AMING DIRECTIVE (DIRECTIVE 2010/73/EC) AND TO THE EXTENT
IMPLEMENTED IN THE RELEVANT MEMBER STATE (THE "PROSPECTUS
DIRECTIVE"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO
(A) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS
ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMED (THE "ORDER")
(INVESTMENT PROFESSIONALS) OR (B) FALL WITHIN ARTICLE 49(2)(a) TO
(d) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.)
OF THE ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS
"RELEVANT PERSONS").
THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON
OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO. 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. THIS ANNOUNCEMENT
DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY
SECURITIES IN BREEDON GROUP PLC.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (THE
"SECURITIES ACT") OR WITH ANY SECURITIES REGULATORY AUTHORITY OF
ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE
OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION OF THE UNITED STATES. THE PLACING SHARES ARE
BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN "OFFSHORE
TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE WITH,
REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN ACCORDANCE
WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING SHARES IS
BEING MADE IN THE UNITED STATES OR ELSEWHERE.
THIS ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF
SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH
RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
The distribution of this Announcement and/or the Placing and/or
issue of the Placing Shares in certain jurisdictions may be
restricted by law. No action has been taken by the Company, the
Joint Bookrunners or any of their respective affiliates, agents,
directors, officers or employees that would permit an offer of the
Placing Shares or possession or distribution of this Announcement
or any other offering or publicity material relating to such
Placing Shares in any jurisdiction where action for that purpose is
required. Persons into whose possession this Announcement comes are
required by the Company and the Joint Bookrunners to inform
themselves about and to observe any such restrictions.
This Announcement or any part of it is for information purposes
only and does not constitute or form part of any offer to issue or
sell, or the solicitation of an offer to acquire, purchase or
subscribe for, any securities in the United States (including its
territories and possessions, any state of the United States and the
District of Columbia), Australia, Canada, the Republic of South
Africa or Japan or any other jurisdiction in which the same would
be unlawful. No public offering of the Placing Shares is being made
in any such jurisdiction.
All offers of the Placing Shares in the EEA will be made
pursuant to an exemption under the Prospectus Directive from the
requirement to produce a prospectus. In the United Kingdom, this
Announcement is being directed solely at persons in circumstances
in which section 21(1) of the Financial Services and Markets Act
2000 (as amended) (the "FSMA") does not apply.
The Placing Shares have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States. The relevant clearances have not
been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged
with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the Placing Shares and the Placing
Shares have not been, nor will they be, registered under or
offering in compliance with the securities laws of any state,
province or territory of Australia, Canada, the Republic of South
Africa or Japan. 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, the Republic of South Africa or Japan or
any other jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligations to forward
a copy of this Announcement should seek appropriate advice before
taking any action.
This Announcement should be read in its entirety. In particular,
you should read and understand the information provided in the
"Important Notices" section of this Announcement.
By participating in the Clawback Placing, each Placee will be
deemed to have read and understood this Announcement in its
entirety, to be participating, making an offer and acquiring
Clawback Placing Shares on the terms and conditions contained
herein and to be providing the representations, warranties,
indemnities, acknowledgements and undertakings contained in this
Appendix.
In particular, each such Placee represents, warrants,
undertakes, agrees and acknowledges (amongst other things)
that:
1. it is a Relevant Person and undertakes that it will acquire,
hold, manage or dispose of any Clawback Placing Shares that are
allocated to it for the purposes of its business;
2. in the case of a Relevant Person in a member state of the EEA
which has implemented the Prospectus Directive (each, a "Relevant
Member State") who acquires any Clawback Placing Shares pursuant to
the Clawback Placing:
(a) it is a Qualified Investor within the meaning of Article
2(1)(e) of the Prospectus Directive; and
(b) in the case of any Clawback Placing Shares acquired by it as
a financial intermediary, as that term is used in Article 3(2) of
the Prospectus Directive:
(i) the Clawback Placing Shares acquired by it in the Clawback
Placing have not been acquired on behalf of, nor have they been
acquired with a view to their offer or resale to, persons in any
Relevant Member State other than Qualified Investors or in
circumstances in which the prior consent of the Joint Bookrunners
have been given to the offer or resale; or
(ii) where Clawback Placing Shares have been acquired by it on
behalf of persons in any Relevant Member State other than Qualified
Investors, the offer of those Clawback Placing Shares to it is not
treated under the Prospectus Directive as having been made to such
persons; and
3. it is acquiring the Clawback Placing Shares for its own
account or is acquiring the Clawback Placing Shares for an account
with respect to which it exercises sole investment discretion and
has the authority to make and does make the representations,
warranties, indemnities, acknowledgements, undertakings and
agreements contained in this Announcement; and
4. it understands (or if acting for the account of another
person, such person has confirmed that such person understands) the
resale and transfer restrictions set out in this Appendix; and
5. except as otherwise permitted by the Company and subject to
any available exemptions from applicable securities laws, it (and
any account referred to in paragraph 4 above) is outside the United
States acquiring the Clawback Placing Shares in offshore
transactions as defined in and in accordance with Regulation S
under the Securities Act.
No prospectus
The Clawback Placing Shares are being offered to a limited
number of specifically invited persons only and will not be offered
in such a way as to require any prospectus or other offering
document to be published. No prospectus or other offering document
has been or will be submitted to be approved by the FCA in relation
to the Clawback Placing or the Clawback Placing Shares and Placees'
commitments will be made solely on the basis of the information
contained in this Announcement and any information publicly
announced through a Regulatory Information Service (as defined in
the AIM Rules for Companies (the "AIM Rules")) by or on behalf of
the Company on or prior to the date of this Announcement (the
"Publicly Available Information") and subject to any further terms
set forth in the contract note to be sent to individual
Placees.
Each Placee, by participating in the Clawback Placing, agrees
that the content of this Announcement is exclusively the
responsibility of the Company and confirms that it has neither
received nor relied on any information (other than the Publicly
Available Information), representation, warranty or statement made
by or on behalf of the Joint Bookrunners or the Company or any
other person and none of the Joint Bookrunners, the Company nor any
other person acting on such person's behalf nor any of their
respective affiliates has or shall have any liability for any
Placee's decision to participate in the Clawback Placing based on
any other information, representation, warranty or statement. Each
Placee acknowledges and agrees that it has relied on its own
investigation of the business, financial or other position of the
Company in accepting a participation in the Clawback Placing. No
Placee should consider any information in this Announcement to be
legal, tax or business advice. Nothing in this paragraph shall
exclude the liability of any person for fraudulent
misrepresentation.
Details of the Placing Agreement and the Placing Shares
The Joint Bookrunners have today entered into a placing
agreement (the "Placing Agreement") with the Company under which,
on the terms and subject to the conditions set out in the Placing
Agreement, the Joint Bookrunners, as agents for and on behalf of
the Company, have agreed to use their respective reasonable
endeavours to procure Placees for the Placing Shares.
The Placing Shares will, when issued, be subject to the
memorandum and articles of association of the Company and credited
as fully paid and will rank pari passu in all respects with the
existing issued ordinary shares of no par value ("Ordinary Shares")
in the capital of the Company, including the right to receive all
dividends and other distributions declared, made or paid in respect
of such Ordinary Shares after the date of issue of the Placing
Shares.
As part of the Placing, the Company has agreed that it will not
for a period of 90 days after (but including) Admission, without
the prior written consent of the Joint Bookrunners (such consent
not to be unreasonably withheld or delayed), directly or
indirectly, allot, issue, offer, sell, lend, pledge, contract to
sell or issue, grant any option, right or warrant to subscribe or
purchase or otherwise dispose of or create any encumbrance over any
Ordinary Shares (or any interest therein or in respect thereof) or
other securities of the Company exchangeable for, convertible into
or representing the right to subscribe or purchase Ordinary Shares
or any substantially similar securities or otherwise enter into any
transaction (including derivative transaction) directly or
indirectly, permanently or temporarily, to dispose of any Ordinary
Shares or undertake any other transaction with the same economic
effect as any of the foregoing or announce an offering of Ordinary
Shares or any interest therein or to announce publicly any
intention to enter into any transaction described above. This
agreement is subject to certain customary exceptions and does not
prevent the grant or exercise of options under any of the Company's
existing share incentives and share option schemes.
The issue of the Placing Shares is to be effected by way of a
cashbox placing. The Company will allot and issue the Placing
Shares on a non-pre-emptive basis to the Placees in consideration
for Cenkos transferring its holdings of redeemable preference
shares and ordinary subscriber shares in Lisbon Funding Limited to
the Company. Accordingly, instead of receiving cash as
consideration for the issue of Placing Shares, at the conclusion of
the Placing the Company will own all of the issued ordinary shares
and redeemable preference shares of Lisbon Funding Limited whose
only asset will be its cash reserves, which will represent an
amount approximately equal to the net proceeds of the Placing.
Application for admission to trading
Application has been made to the London Stock Exchange for
admission of the Placing Shares to trading on AIM.
It is expected that Admission will take place on or before 8.00
a.m. on 19 April 2018 and that dealings in the Placing Shares on
AIM will commence at the same time.
Principal terms of the Placing
1. The Joint Bookrunners are acting joint bookrunners to the
Placing, as agents for and on behalf of the Company.
2. Participation in the Placing will only be available to
persons who may lawfully be, and are, invited by the Joint
Bookrunners to participate. The Joint Bookrunners and any of their
respective affiliates are entitled to participate in the Placing as
principal.
3. The Placing Price is fixed at 76.5 pence and is payable to
the Joint Bookrunners (as agents for the Company) by all
Placees.
4. Each Placee's allocation will be determined by the Joint
Bookrunners in their discretion following consultation with the
Company and will be confirmed orally by the Joint Bookrunners.
5. Each Placee's allocation and commitment will be evidenced by
a contract note issued to such Placee by the relevant Joint
Bookrunner. The terms of this Appendix will be deemed incorporated
in that contract note.
6. Each Placee's allocation and commitment to acquire Clawback
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 the relevant
Joint Bookrunner's consent will not be capable of variation or
revocation after the time at which it is submitted. Each Placee
will have an immediate, separate, irrevocable and binding
obligation, owed to the relevant Joint Bookrunner (as agent for the
Company), to pay to it (or as it may direct) in cleared funds an
amount equal to the product of the Placing Price and the number of
Clawback Placing Shares such Placee has agreed to acquire and the
Company has agreed to allot and issue to that Placee.
7. Except as required by law or regulation, no press release or
other announcement will be made by the Joint Bookrunners 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.
8. Irrespective of the time at which a Placee's allocation(s)
pursuant to the Clawback Placing is/are confirmed, settlement for
all Clawback Placing Shares to be acquired pursuant to the Clawback
Placing will be required to be made at the same time, on the basis
explained below under "Registration and Settlement".
9. All obligations under the Placing will be subject to
fulfilment 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 "Termination of the Placing".
10. By participating in the Clawback Placing, each Placee will
agree that its rights and obligations in respect of the Clawback
Placing will terminate only in the circumstances described below
and will not be capable of rescission or termination by the
Placee.
11. To the fullest extent permissible by law and applicable FCA rules, neither:
(a) the Joint Bookrunners;
(b) any of their respective affiliates, agents, directors,
officers, consultants or employees; nor
(c) to the extent not contained within (a) or (b), any person
connected with the Joint Bookrunners as defined in the FSMA ((b)
and (c) being together "affiliates" and individually an "affiliate"
of the Joint Bookrunners);
shall have any liability (including to the extent permissible by
law, any fiduciary duties) to Placees or to any other person
whether acting on behalf of a Placee or otherwise. In particular,
neither the Joint Bookrunners nor any of their respective
affiliates shall have any liability (including, to the extent
permissible by law, any fiduciary duties) in respect of the Joint
Bookrunners' conduct of the Placing or of such alternative method
of effecting the Placing as the Joint Bookrunners and the Company
may agree.
Registration and settlement
If Placees are allocated any Clawback Placing Shares in the
Clawback Placing they will be sent a contract note or electronic
confirmation which will confirm the number of Clawback Placing
Shares allocated to them, the Placing Price and the aggregate
amount owed by them to the relevant Joint Bookrunner.
Each Placee will be deemed to agree that it will do all things
necessary to ensure that delivery and payment is completed as
directed by the relevant Joint Bookrunner in accordance with either
the standing CREST or certificated settlement instructions which
they have in place with the relevant Joint Bookrunner.
Settlement of transactions in the Placing Shares (ISIN:
JE00B2419D89) following Admission will take place within the CREST
system, subject to certain exceptions. Settlement through CREST
will be on a T+2 basis unless otherwise notified by the Joint
Bookrunners and is expected to occur on 19 April 2018 (the
"Settlement Date") in accordance with the contract notes.
Settlement will be on a delivery versus payment basis. However, in
the event of any difficulties or delays in the admission of the
Placing Shares to CREST or the use of CREST in relation to the
Placing, the Company and the Joint Bookrunners may agree that the
Placing Shares should be issued in certificated form. The Joint
Bookrunners reserve the right to require settlement for the Placing
Shares, and to deliver the Placing Shares to Placees, by such other
means as they deem necessary if delivery or settlement to Placees
is not practicable within the CREST system or would not be
consistent with regulatory requirements in the jurisdiction in
which a Placee is located.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above, in respect of either CREST or certificated deliveries, at
the rate of two percentage points above prevailing base rate of
Barclays Bank plc as determined by the Joint Bookrunners.
Each Placee is deemed to agree that if it does not comply with
these obligations, the Joint Bookrunners may sell any or all of
their Clawback Placing Shares on their behalf and retain from the
proceeds, for the relevant Joint Bookrunner's own account and
benefit, an amount equal to the aggregate amount owed by the Placee
plus any interest due. The relevant Placee will, however, remain
liable for any shortfall below the Placing Price and for any stamp
duty or stamp duty reserve tax (together with any interest or
penalties) which may arise upon the sale of its Clawback Placing
Shares on its behalf.
If Clawback Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional contract note is copied and delivered immediately to
the relevant person within that organisation. Insofar as Clawback
Placing Shares are registered in a Placee's name or that of its
nominee or in the name of any person for whom a Placee is
contracting as agent or that of a nominee for such person, such
Clawback Placing Shares should, subject as provided below, be so
registered free from any liability to United Kingdom stamp duty or
stamp duty reserve tax. Placees will not be entitled to receive any
fee or commission in connection with the Clawback Placing.
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 the Joint Bookrunners under the Placing
Agreement are, and the Placing is, conditional upon, inter
alia:
(a) certain announcement obligations;
(b) the SPA having become unconditional in all respects (save in
respect of any condition relating to the Placing Agreement,
including the transfer of the Placing proceeds, becoming
unconditional and Admission) and not being terminated in accordance
with its terms
(c) the Facility Agreement having become unconditional in all
respects (save in respect of any condition relating to the Placing
Agreement becoming unconditional, Admission and the completion of
the SPA) and not being terminated in accordance with its terms;
(d) the warranties contained in the Placing Agreement not being
breached (save where such breach is not considered by the Joint
Bookrunners, acting jointly and in good faith, to be material in
the context of the Placing) when made at the date of the Placing
Agreement and at Admission by reference to the facts and
circumstances subsisting at the time;
(e) the Company complying with its obligations under the Placing
Agreement in all material respects to the extent that they fall to
be performed on or before Admission; and
(f) Admission becoming effective in accordance with the AIM
Rules for Companies by no later than 8.00 a.m. on 19 April 2018 (or
by such later date as the Company and the Joint Bookrunners (acting
jointly) may agree in writing, being no later than 8.00 a.m. on 26
April 2018);
(all conditions to the obligations of the Joint Bookrunners
included in the Placing Agreement being together, the
"conditions").
If any of the conditions set out in the Placing Agreement is not
fulfilled or, where permitted, waived in accordance with the
Placing Agreement within the stated time periods (or such later
time and/or date as the Company and the Joint Bookrunners may
agree), or the Placing Agreement is terminated in accordance with
its terms, the Placing will lapse and the Placee's rights and
obligations shall cease and terminate at such time and each Placee
agrees that no claim can be made by or on behalf of the Placee (or
any person on whose behalf the Placee is acting) in respect
thereof.
By participating in the Clawback Placing, each Placee agrees
that its rights and obligations cease and terminate only in the
circumstances described above and under "Termination of the
Placing" below and will not be capable of rescission or termination
by it.
The Joint Bookrunners may, in their absolute discretion and upon
such terms as they think fit, waive fulfilment of all or any of the
conditions in the Placing Agreement in whole or in part, or extend
the time provided for fulfilment of one or more conditions, save
that the condition relating to Admission referred to in paragraph
(f) above may not be waived. Any such extension or waiver will not
affect Placees' commitments as set out in this Appendix.
The Joint Bookrunners may terminate the Placing Agreement in
certain circumstances, details of which are set out below.
Neither the Joint Bookrunners nor any of their respective
affiliates, agents, directors, officers or employees nor the
Company shall have any liability to any Placee (or to any other
person whether acting on behalf of a Placee or otherwise) in
respect of any decision any of them may make as to whether or not
to waive or to extend the time and/or date for the satisfaction of
any condition to the Placing nor for any decision any of them may
make as to the satisfaction of any condition or in respect of the
Placing generally and by participating in the Placing each Placee
agrees that any such decision is within the absolute discretion of
the Joint Bookrunners.
Termination of the Placing
The Joint Bookrunners may, in their absolute discretion (acting
jointly and in good faith and after such consultation with the
Company as may be practicable in the circumstances), by notice to
the Company, terminate the Placing Agreement at any time up to
Admission if, inter alia:
(a) any statement contained in this Announcement or any other
document or announcement issued or published by or on behalf of the
Company in connection with the Placing is or has become or has been
discovered to be untrue, inaccurate or misleading in any material
respect or any matter has arisen which would, at the time the
relevant document was issued, constitute a material omission from
any such documents;
(b) any of the warranties in the Placing Agreement was breached
(save where such breach is not material) when made at the date of
the Placing Agreement or at Admission by reference to the facts and
circumstances subsisting at that time; or
(c) there has been a material adverse change of the Company or
the Group which is material in the context of the Group as a whole,
or there is a fact, circumstance or development reasonably likely
to result in a material adverse change;
(d) there has been a force majeure event.
If the Placing Agreement is terminated in accordance with its
terms, the rights and obligations of each Placee in respect of the
Clawback Placing as described in this Announcement shall cease and
terminate at such time and no claim can be made by any Placee in
respect thereof.
By participating in the Clawback Placing, each Placee agrees
with the Company and the Joint Bookrunners that the exercise by the
Company or the Joint Bookrunners of any right of termination or any
other right or other discretion under the Placing Agreement shall
be within the absolute discretion of the Company or the Joint
Bookrunners or for agreement between the Company and the Joint
Bookrunners (as the case may be) and that neither the Company nor
the Joint Bookrunners need make any reference to such Placee and
that none of the Company, the Joint Bookrunners nor any of their
respective affiliates, agents, directors, officers or employees
shall have any liability to such Placee (or to any other person
whether acting on behalf of a Placee or otherwise) whatsoever in
connection with any such exercise.
By participating in the Clawback Placing, each Placee agrees
that its rights and obligations terminate only in the circumstances
described above and under the "Conditions of the Placing" section
above and will not be capable of rescission or termination by it
after the issue by the Joint Bookrunners of a contract note
confirming each Placee's allocation and commitment in the Clawback
Placing.
Representations, warranties and further terms
By participating in the Clawback Placing, each Placee (and any
person acting on such Placee's behalf) represents, warrants,
acknowledges and agrees (for itself and for any such prospective
Placee) that (save where the Joint Bookrunners expressly agree in
writing to the contrary):
1. it has read and understood this Announcement in its entirety
and that its acquisition of the Clawback Placing Shares is subject
to and based upon all the terms, conditions, representations,
warranties, indemnities, acknowledgements, agreements and
undertakings and other information contained herein and that it has
not relied on, and will not rely on, any information given or any
representations, warranties or statements made at any time by any
person in connection with Admission, the Placing, the Company, the
Placing Shares or otherwise, other than the information contained
in this Announcement and the Publicly Available Information;
2. it has not received a prospectus or other offering document
in connection with the Placing and acknowledges that no prospectus
or other offering document:
(a) is required under the Prospectus Directive or other applicable law; and
(b) has been or will be prepared in connection with the Placing;
3. the Ordinary Shares are admitted to trading on AIM, and that
the Company is therefore required to publish certain business and
financial information in accordance with the AIM Rules and the
Market Abuse Regulation (EU Regulation No. 596/2014 (the "MAR")),
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 without undue difficulty, and is able to obtain access
to such information or comparable information concerning any other
publicly traded company, without undue difficulty;
4. it has made its own assessment of the Clawback Placing Shares
and has relied on its own investigation of the business, financial
or other position of the Company in accepting a participation in
the Clawback Placing and neither the Joint Bookrunners nor the
Company nor any of their respective affiliates, agents, directors,
officers or employees nor any person acting on behalf of any of
them has provided, and will not provide, it with any material
regarding the Clawback Placing Shares or the Company or any other
person other than the information in this Announcement or the
Publicly Available Information; nor has it requested the Joint
Bookrunners, the Company, any of their respective affiliates,
agents, directors, employees or officers or any person acting on
behalf of any of them to provide it with any such information;
5. neither the Joint Bookrunners nor any person acting on behalf
of them nor any of their respective affiliates, agents, directors,
officers or employees has or shall have any liability for any
Publicly Available Information, or any representation relating to
the Company, provided that nothing in this paragraph excludes the
liability of any person for fraudulent misrepresentation made by
that person;
6.
(a) the only information on which it is entitled to rely on and
on which it has relied in committing to acquire the Clawback
Placing Shares is contained in the Publicly Available Information,
such information being all that it deems necessary to make an
investment decision in respect of the Clawback Placing Shares and
it has made its own assessment of the Company, the Clawback Placing
Shares and the terms of the Clawback Placing based on Publicly
Available Information;
(b) neither the Joint Bookrunners, nor the Company (nor any of
their respective affiliates, agents, directors, officers and
employees) have made any representation or warranty to it, express
or implied, with respect to the Company, the Placing or the Placing
Shares or the accuracy, completeness or adequacy of the Publicly
Available Information;
(c) it has conducted its own investigation of the Company, the
Clawback Placing and the Clawback Placing Shares, satisfied itself
that the information is still current and relied on that
investigation for the purposes of its decision to participate in
the Clawback Placing; and
(d) it has not relied on any investigation that the Joint
Bookrunners or any person acting on their behalf may have conducted
with respect to the Company, the Clawback Placing or the Clawback
Placing Shares;
7. the content of this Announcement and the Publicly Available
Information has been prepared by and is exclusively the
responsibility of the Company and that neither the Joint
Bookrunners nor any persons acting on their behalf is responsible
for or has or shall have any liability for any information,
representation, warranty or statement relating to the Company
contained in this Announcement or the Publicly Available
Information nor will they be liable for any Placee's decision to
participate in the Clawback Placing based on any information,
representation, warranty or statement contained in this
Announcement, the Publicly Available Information or otherwise.
Nothing in this Appendix shall exclude any liability of any person
for fraudulent misrepresentation;
8. it is not, and at the time the Clawback Placing Shares are
acquired will not be, a resident of Australia, Canada, the Republic
of South Africa or Japan;
9. the Clawback Placing Shares have not been registered or
otherwise qualified, and will not be registered or otherwise
qualified, for offer and sale nor will a prospectus be cleared or
approved in respect of any of the Clawback Placing Shares under the
securities laws of the United States, or any state or other
jurisdiction of the United States, Australia, Canada, the Republic
of South Africa or Japan and, subject to certain exceptions, may
not be offered, sold, taken up, renounced or delivered or
transferred, directly or indirectly, within the United States,
Australia, Canada, the Republic of South Africa or Japan or in any
country or jurisdiction where any such action for that purpose is
required;
10. it has the funds available to pay for the Clawback Placing
Shares for which it has agreed to acquire and acknowledges and
agrees 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 Clawback Placing Shares may
be placed with other Placees or sold at such price as the Joint
Bookrunners determine;
11. it and/or each person on whose behalf it is participating:
(a) is entitled to acquire Clawback Placing Shares pursuant to
the Clawback Placing under the laws and regulations of all relevant
jurisdictions;
(b) has fully observed such laws and regulations;
(c) has capacity and authority and is entitled to enter into and
perform its obligations as an acquirer of Clawback Placing Shares
and will honour such obligations; and
(d) has obtained all necessary consents and authorities
(including, without limitation, in the case of a person acting on
behalf of a Placee, all necessary consents and authorities to agree
to the terms set out or referred to in this Appendix) under those
laws or otherwise and complied with all necessary formalities to
enable it to enter into the transactions contemplated hereby and to
perform its obligations in relation thereto and, in particular, if
it is a pension fund or investment company it is aware of and
acknowledges it is required to comply with all applicable laws and
regulations with respect to its acquisition of Clawback Placing
Shares;
12. it is not, and any person who it is acting on behalf of is
not, and at the time the Clawback Placing Shares are acquired will
not be, a resident of, or with an address in, or subject to the
laws of, Australia, Canada, the Republic of South Africa or Japan,
and it acknowledges and agrees that the Clawback Placing Shares
have not been and will not be registered or otherwise qualified
under the securities legislation of Australia, Canada, the Republic
of South Africa or Japan and may not be offered, sold, or acquired,
directly or indirectly, within those jurisdictions;
13. it and the beneficial owner of the Clawback Placing Shares
is, and at the time the Clawback Placing Shares are acquired will
be, outside the United States and acquiring the Clawback Placing
Shares in an "offshore transaction" as defined in, and in
accordance with, Regulation S under the Securities Act;
14. it understands that the Placing Shares have not been, and
will not be, registered under the Securities Act and may not be
offered, sold or resold in or into or from the United States except
pursuant to an effective registration under the Securities Act, or
pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act and in
accordance with applicable state securities laws; and no
representation is being made as to the availability of any
exemption under the Securities Act for the reoffer, resale, pledge
or transfer of the Placing Shares;
15. it (and any account for which it is purchasing) is not
acquiring the Clawback Placing Shares with a view to any offer,
sale or distribution thereof within the meaning of the Securities
Act;
16. it understands that:
(a) the Clawback Placing Shares are "restricted securities"
within the meaning of Rule 144(a)(3) under the Securities Act and
will be subject to restrictions on resale and transfer subject to
certain exceptions under US law;
(b) no representation is made as to the availability of the
exemption provided by Rule 144 for resales or transfers of Clawback
Placing Shares; and
(c) it will not deposit the Clawback Placing Shares in an
unrestricted depositary receipt programme in the United States or
for US persons (as defined in the Securities Act);
17. it will not offer, sell, transfer, pledge or otherwise
dispose of any Clawback Placing Shares except:
(a) in an offshore transaction in accordance with Rules 903 or
904 of Regulation S under the Securities Act; or
(b) pursuant to another exemption from registration under the Securities Act, if available,
and in each case in accordance with all applicable securities
laws of the states of the United States and other
jurisdictions;
18. no representation has been made as to the availability of
the exemption provided by Rule 144, Rule 144A or any other
exemption under the Securities Act for the reoffer, resale, pledge
or transfer of the Clawback Placing Shares;
19. it understands that the Clawback Placing Shares are expected
to be issued to it through CREST but may be issued to it in
certificated, definitive form and acknowledges and agrees that the
Clawback Placing Shares will, to the extent they are delivered in
certificated form, bear a legend to the following effect unless
agreed otherwise with the Company:
"THESE SECURITIES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (THE "SECURITIES
ACT"), OR UNDER THE APPLICABLE SECURITIES LAWS OR WITH ANY
SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION
OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (A) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (C) PURSUANT
TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF
THE UNITED STATES. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THE
FOREGOING, THE SECURITIES MAY NOT BE DEPOSITED INTO ANY
UNRESTRICTED DEPOSITARY RECEIPT FACILITY IN RESPECT OF THE
COMPANY'S SECURITIES ESTABLISHED OR MAINTAINED BY A DEPOSITARY
BANK. EACH HOLDER, BY ITS ACCEPTANCE OF THESE SHARES, REPRESENTS
THAT IT UNDERSTANDS AND AGREES TO THE FOREGOING RESTRICTIONS.";
20. it is not taking up the Clawback Placing Shares as a result
of any "general solicitation" or "general advertising" efforts (as
those terms are defined in Regulation D under the Securities Act)
or any "directed selling efforts" (as such term is defined in
Regulation S under the Securities Act);
21. if located in the United States, it understands that there
may be certain consequences under United States and other tax laws
resulting from an investment in the Clawback Placing and it has
made such investigation and has consulted its own independent
advisers or otherwise has satisfied itself concerning, without
limitation, the effects of United States federal, state and local
income tax laws and foreign tax laws generally;
22. it will not distribute, forward, transfer or otherwise
transmit this Announcement or any part of it, or any other
presentational or other materials concerning the Clawback Placing
in or into or from the United States (including electronic copies
thereof) to any person, and it has not distributed, forwarded,
transferred or otherwise transmitted any such materials to any
person;
23. none of the Joint Bookrunners, their respective affiliates
and any person acting on behalf of any of them is making any
recommendations to it or advising it regarding the suitability of
any transactions it may enter into in connection with the Clawback
Placing and that participation in the Clawback Placing is on the
basis that it is not and will not be a client of either Joint
Bookrunner and that neither Joint Bookrunner has any duties or
responsibilities to it for providing the protections afforded to
its clients or for providing advice in relation to the Clawback
Placing nor in respect of any representations, warranties,
undertakings or indemnities contained in the Placing Agreement nor
for the exercise or performance of any of its rights and
obligations thereunder including any rights to waive or vary any
conditions or exercise any termination right;
24. it will make payment to the relevant Joint Bookrunner for
the Clawback Placing Shares allocated to it in accordance with the
terms and conditions of this Announcement on the due times and
dates set out in this Announcement, failing which the relevant
Clawback Placing Shares may be placed with others on such terms as
the relevant Joint Bookrunner determines in its absolute discretion
without liability to the Placee and it will remain liable for any
shortfall below the net proceeds of such sale and the placing
proceeds of such Clawback Placing Shares and may be required to
bear any 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 Clawback Placing Shares on its behalf;
25. its allocation (if any) of Clawback Placing Shares will
represent a maximum number of Clawback Placing Shares which it will
be entitled, and required, to subscribe for, and that the Company
may call upon it to subscribe for a lower number of Clawback
Placing Shares (if any), but in no event in aggregate more than the
aforementioned maximum;
26. no action has been or will be taken by any of the Company,
the Joint Bookrunners or any person acting on behalf of the Company
or the Joint Bookrunners that would, or is intended to, permit a
public offer of the Clawback Placing Shares in the United States or
in any country or jurisdiction where any such action for that
purpose is required;
27. the person who it specifies for registration as holder of
the Clawback Placing Shares will be:
(a) the Placee; or
(b) a nominee of the Placee, as the case may be.
The Joint Bookrunners and the Company will not 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 acquire Clawback
Placing Shares pursuant to the Clawback Placing and agrees to
indemnify the Company and the Joint Bookrunners in respect of the
same on the basis that the Clawback Placing Shares will be allotted
to a CREST stock account of the relevant Joint Bookrunner or
transferred to a CREST stock account of the relevant Joint
Bookrunner who will hold them as nominee on behalf of the Placee
until settlement in accordance with its standing settlement
instructions with it;
28. the allocation, allotment, issue and delivery to it, or the
person specified by it for registration as holder, of Clawback
Placing Shares will not give rise to a stamp duty or stamp duty
reserve tax liability under (or at a rate determined under) any of
sections 67, 70, 93 or 96 of the Finance Act 1986 (depository
receipts and clearance services) and that it is not participating
in the Clawback Placing as nominee or agent for any person or
persons to whom the allocation, allotment, issue or delivery of
Clawback Placing Shares would give rise to such a liability;
29. if it is within the United Kingdom, it and any person acting
on its behalf falls within Article 19(5) and/or 49(2) of the Order
and undertakes that it will acquire, hold, manage and (if
applicable) dispose of any Clawback Placing Shares that are
allocated to it for the purposes of its business only;
30. it has not offered or sold and will not offer or sell any
Clawback Placing Shares to persons in the United Kingdom or
elsewhere in the EEA prior to the expiry of a period of six months
from Admission except to persons whose ordinary activities involve
them in acquiring, holding, managing or disposing of investments
(as principal or agent) for the purposes of their business or
otherwise in circumstances which have not resulted and which will
not result in an offer to the public in the United Kingdom within
the meaning of section 85(1) of the FSMA or an offer to the public
in any other member state of the EEA within the meaning of the
Prospectus Directive;
31. if it is within the EEA, it is a Qualified Investor as
defined in section 86(7) of the FSMA, being a person falling within
Article 2(1)(e) of the Prospectus Directive;
32. it has only communicated or caused to be communicated and it
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of the FSMA) relating to Clawback Placing Shares in
circumstances in which section 21(1) of the FSMA does not require
approval of the communication by an authorised person and it
acknowledges and agrees that this Announcement has not been
approved by either Joint Bookrunner in its capacity as an
authorised person under section 21 of the 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;
33. it has complied and it will comply with all applicable laws
with respect to anything done by it or on its behalf in relation to
the Clawback Placing Shares (including all relevant provisions of
the FSMA in respect of anything done in, from or otherwise
involving the United Kingdom);
34. if it is a financial intermediary, as that term is used in
Article 3(2) of the Prospectus Directive (including any relevant
implementing measure in any member state), the Clawback Placing
Shares acquired by it in the Clawback 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 EEA which has implemented the Prospectus
Directive other than Qualified Investors, or in circumstances in
which the express prior written consent of the Joint Bookrunners
has been given to the offer or resale;
35. if it has received any inside information (for the purposes
of the MAR and section 56 of the Criminal Justice Act 1993 or other
applicable law) about the Company in advance of the Clawback
Placing, it has not:
(a) dealt (or attempted to deal) in the securities of the Company;
(b) encouraged, recommended or induced another person to deal in
the securities of the Company; or
(c) unlawfully disclosed such information to any person, prior
to the information being made publicly available;
36. it will (or will procure that its nominee will) if
applicable, make notification to the Company of the interest in its
Ordinary Shares in accordance with Rule 5 of the Disclosure
Guidance and Transparency Rules issued by the FCA and made under
Part VI of the FSMA and the memorandum and articles of association
of the Company;
37. neither the Joint Bookrunners, the Company nor any of their
respective affiliates, agents, directors, officers or employees nor
any person acting on behalf of the Joint Bookrunners or their
respective affiliates, agents, directors, officers or employees is
making any recommendations to it, advising it regarding the
suitability of any transactions it may enter into in connection
with the Clawback Placing nor providing advice in relation to the
Clawback Placing nor in respect of any representations, warranties,
acknowledgements, agreements, undertakings, or indemnities
contained in the Placing Agreement nor the exercise or performance
of any of the Joint Bookrunners' rights and obligations thereunder
including any rights to waive or vary any conditions or exercise
any termination right;
38. each Joint Bookrunner and its affiliates, acting as an
investor for its or their own account(s), may bid or subscribe for
and/or purchase Clawback Placing Shares and, in that capacity, may
retain, purchase, offer to sell or otherwise deal for its or their
own account(s) in the Clawback Placing Shares, any other securities
of the Company or other related investments in connection with the
Clawback Placing or otherwise. Accordingly, references in this
Announcement to the Clawback Placing Shares being offered,
subscribed, acquired or otherwise dealt with should be read as
including any offer to, or subscription, acquisition or dealing by,
the Joint Bookrunners and/or any of their respective affiliates
acting as an investor for its or their own account(s). Neither the
Joint Bookrunners 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;
39. it:
(a) has complied with its obligations in connection with money
laundering and terrorist financing under the Proceeds of Crime Act
2002, the Terrorism Act 2000 (as amended), the Terrorism Act 2006
and the Money Laundering, Terrorist Financing and Transfer of Funds
(Information on the Payer) Regulations 2017;
(b) is not a person:
(i) with whom transactions are prohibited under the US Foreign
Corrupt Practices Act of 1977 or any economic sanction programmes
administered by, or regulations promulgated by, the Office of
Foreign Assets Control of the U.S. Department of the Treasury;
(ii) named on the Consolidated List of Financial Sanctions
Targets maintained by HM Treasury of the United Kingdom; or
(iii) subject to financial sanctions imposed pursuant to a
regulation of the European Union or a regulation adopted by the
United Nations or other applicable law,
(together, the "Regulations") and if making payment on behalf of
a third party, that satisfactory evidence has been obtained and
recorded by it to verify the identity of the third party as
required by the Regulations and has obtained all governmental and
other consents (if any) which may be required for the purpose of,
or as a consequence of, such purchase, and it will provide promptly
to the Joint Bookrunners such evidence, if any, as to the identity
or location or legal status of any person which they may request
from it in connection with the Clawback Placing (for the purpose of
complying with the Regulations or ascertaining the nationality of
any person or the jurisdiction(s) to which any person is subject or
otherwise) in the form and manner requested by the Joint
Bookrunners on the basis that any failure by it to do so may result
in the number of Clawback Placing Shares that are to be acquired by
it or at its direction pursuant to the Clawback Placing being
reduced to such number, or to nil, as the Joint Bookrunners may
decide at their sole discretion;
40. in order to ensure compliance with the Regulations, each
Joint Bookrunner (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 the
relevant Joint Bookrunner or the Company's registrars, as
applicable, of evidence of identity, definitive certificates in
respect of the Clawback Placing Shares may be retained at the
relevant Joint Bookrunner's absolute discretion or, where
appropriate, delivery of the Clawback Placing Shares to it in
uncertificated form may be delayed at the relevant Joint
Bookrunner'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 the relevant Joint Bookrunner (for
itself and as agent on behalf of the Company) or the Company's
registrars have not received evidence satisfactory to them, either
the relevant Joint Bookrunner and/or the Company may, at its
absolute discretion, terminate its commitment in respect of the
Clawback 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;
41. it acknowledges that its commitment to acquire Clawback
Placing Shares on the terms set out in this Announcement and in the
contract note will continue notwithstanding any amendment that may
in future be made to the terms and conditions of the Clawback
Placing and that Placees will have no right to be consulted or
require that their consent be obtained with respect to the
Company's or the Joint Bookrunners' conduct of the Clawback
Placing;
42. it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of acquiring the Clawback Placing Shares. It
further acknowledges 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 Clawback Placing.
It has relied upon its own examination and due diligence of the
Company and its affiliates taken as a whole, and the terms of the
Clawback Placing, including the merits and risks involved;
43. it irrevocably appoints any duly authorised officer of each
Joint Bookrunner as its agent for the purpose 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 Clawback Placing Shares for which it agrees to acquire
upon the terms of this Announcement;
44. the Company, the Joint Bookrunners and others (including
each of their respective affiliates, agents, directors, officers
and employees) will rely upon the truth and accuracy of the
foregoing representations, warranties, acknowledgements and
agreements, which are given to each Joint Bookrunner on its own
behalf and on behalf of the Company and are irrevocable;
45. it is acting as principal only in respect of the Clawback
Placing or, if it is acquiring the Clawback Placing Shares as a
fiduciary or agent for one or more investor accounts, it is duly
authorised to do so and it has full power and authority to make,
and does make, the foregoing representations, warranties,
acknowledgements, agreements and undertakings on behalf of each
such accounts;
46. time is of the essence as regards its obligations under this Appendix;
47. any document that is to be sent to it in connection with the
Clawback Placing will be sent at its risk and may be sent to it at
any address provided by it to the Joint Bookrunners;
48. the Clawback Placing Shares will be issued subject to the
terms and conditions of this Appendix; and
49. the terms and conditions contained in this Appendix and all
documents into which this Appendix is incorporated by reference or
otherwise validly forms a part and/or any agreements entered into
pursuant to these terms and conditions and all agreements to
acquire Clawback Placing Shares pursuant to the Clawback Placing
will be governed by and construed in accordance with English law
and it submits to the exclusive jurisdiction of the English courts
in relation to any claim, dispute or matter arising out of such
contract except that enforcement proceedings in respect of the
obligation to make payment for the Clawback Placing Shares
(together with interest chargeable thereon) may be taken by the
Company or the Joint Bookrunners in any jurisdiction in which the
relevant Placee is incorporated or in which any of its securities
have a quotation on a recognised stock exchange.
By participating in the Clawback Placing, each Placee (and any
person acting on such Placee's behalf) agrees to indemnify and hold
the Company, the Joint Bookrunners and each of their respective
affiliates, agents, directors, officers and employees harmless from
any and all costs, claims, liabilities and expenses (including
legal fees and expenses) arising out of or in connection with any
breach of the representations, warranties, acknowledgements,
agreements and undertakings given by the Placee (and any person
acting on such Placee's behalf) in this Appendix or incurred by the
Joint Bookrunners, the Company or each of their respective
affiliates, agents, directors, officers or employees arising from
the performance of the Placee's obligations as set out in this
Announcement, and further agrees that the provisions of this
Appendix shall survive after the completion of the Clawback
Placing.
The agreement to allot and issue Clawback Placing Shares to
Placees (or the persons for whom Placees are contracting as agent)
free of stamp duty and stamp duty reserve tax in the United Kingdom
relates only to their allotment and issue to Placees, or such
persons as they nominate as their agents, direct by the Company.
Such agreement assumes that the Clawback Placing Shares are not
being acquired in connection with arrangements to issue depositary
receipts or to transfer the Clawback Placing Shares into a
clearance service. If there are any such arrangements, or the
settlement related to any other dealings in the Clawback Placing
Shares, stamp duty or stamp duty reserve tax may be payable. In
that event, the Placee agrees that it shall be responsible for such
stamp duty or stamp duty reserve tax and neither the Company nor
the Joint Bookrunners shall be responsible for such stamp duty or
stamp duty reserve tax. If this is the case, each Placee should
seek its own advice and they should notify the Joint Bookrunners
accordingly. 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 United Kingdom by them or any other person on
the acquisition by them of any Clawback Placing Shares or the
agreement by them to acquire any Clawback Placing Shares and each
Placee, or the Placee's nominee, in respect of whom (or in respect
of the person for whom it is participating in the Clawback Placing
as an agent or nominee) the allocation, allotment, issue or
delivery of Clawback Placing Shares has given rise to such
non-United Kingdom stamp, registration, documentary, transfer or
similar taxes or duties undertakes to pay such taxes and duties,
including any interest and penalties (if applicable), forthwith and
to indemnify on an after-tax basis and to hold harmless the Company
and the Joint Bookrunners in the event that either the Company
and/or the Joint Bookrunners have incurred any such liability to
such taxes or duties.
The representations, warranties, acknowledgements and
undertakings contained in this Appendix are given to each Joint
Bookrunner for itself and on behalf of the Company and are
irrevocable.
Cenkos is authorised and regulated by the FCA in the United
Kingdom and is acting exclusively for the Company and no one else
in connection with the Placing, and Cenkos will not be responsible
to anyone (including any Placees) other than the Company for
providing the protections afforded to its clients or for providing
advice in relation to the Placing or any other matters referred to
in this Announcement.
Numis is authorised and regulated by the FCA in the United
Kingdom and is acting exclusively for the Company and no one else
in connection with the Placing, and Numis will not be responsible
to anyone (including any Placees) other than the Company for
providing the protections afforded to its clients or for providing
advice in relation to the Placing or any other matters referred to
in this Announcement.
Each Placee and any person acting on behalf of the Placee
acknowledges that the Joint Bookrunners do not owe any fiduciary or
other duties to any Placee in respect of any representations,
warranties, undertakings, acknowledgements, agreements or
indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that each Joint Bookrunner may (at its
absolute discretion) satisfy its obligations to procure Placees by
itself agreeing to become a Placee in respect of some or all of the
Clawback Placing Shares or by nominating any connected or
associated person to do so.
When a Placee or any person acting on behalf of the Placee is
dealing with the Joint Bookrunners, any money held in an account
with the relevant Joint Bookrunner 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 the FSMA. Each 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 the relevant Joint Bookrunner's money
in accordance with the client money rules and will be held by it
under a banking relationship and not as trustee.
References to time in this Announcement are to London time,
unless otherwise stated.
All times and dates in this Announcement may be subject to
amendment. Placees will be notified of any changes.
No statement in this Announcement is intended to be a profit
forecast or estimate, 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.
The price of shares and any income expected from them may go
down as well as up and investors may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance, and persons needing advice should consult an
independent financial adviser.
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.
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.
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQDMGMDMVVGRZZ
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April 17, 2018 02:00 ET (06:00 GMT)
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