TIDMCVSG
RNS Number : 0719F
CVS Group plc
16 February 2018
16 FEBRUARY 2018
PLEASE READ THE IMPORTANT INFORMATION SECTION WITHIN THIS
ANNOUNCEMENT.
THIS ANNOUNCEMENT, INCLUDING THE APPIX, AND THE INFORMATION
CONTAINED HEREIN, IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION,
DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF IRELAND OR
THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH IT
WOULD BE UNLAWFUL TO DO SO.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014. IN ADDITION, MARKET
SOUNDINGS WERE TAKEN IN RESPECT OF THE MATTERS CONTAINED IN THIS
ANNOUNCEMENT, WITH THE RESULT THAT CERTAIN PERSONS BECAME AWARE OF
SUCH INSIDE INFORMATION PRIOR TO THE DATE OF THIS ANNOUNCEMENT.
UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION
IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL
THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.
UNLESS OTHERWISE INDICATED, CAPITALISED TERMS IN THIS
ANNOUNCEMENT HAVE THE MEANINGS GIVEN TO THEM IN THE DEFINITIONS
SECTION INCLUDED IN THE APPIX.
CVS Group plc
("CVS", the "Company" or the "Group")
Proposed Accelerated Bookbuild
CVS Group plc (AIM: CVSG), one of the UK's leading providers of
integrated veterinary services, is pleased to announce its
intention to conduct a placing of up to 6,391,000 new ordinary
shares of 0.2 pence each in the Company (the "Placing Shares"), at
a price expected to be not less than 1050 pence per Placing Share
(the "Placing").
The Placing Shares are being offered by way of an accelerated
bookbuild (the "Bookbuild"), which will be launched immediately
following this Announcement. The final price and number of the
Placing Shares will be determined following the Bookbuild. N+1
Singer is acting as sole bookrunner in connection with the
Bookbuild.
The Placing Shares will represent a maximum of approximately
9.88 per cent. of the Company's existing total voting rights and
the Company has existing shareholder authorities to issue and allot
the Placing Shares on a non pre-emptive basis.
Summary Details of the Placing
-- The net proceeds of the Placing will primarily be used to
enable the Group to pay down debt and create additional headroom to
help fund expected future acquisitions, including an identified
pipeline (described more fully below) of approximately GBP40
million of deals which the Group expects to conclude in the next
six months.
-- The Placing and application of the net Placing proceeds are
in line with the Group's existing funding and growth
strategies.
-- The Placing is being made under existing shareholder
authorities and is conditional on, amongst other things, admission
of the Placing Shares to trading on AIM.
-- The minimum Placing Price represents a maximum discount of
approximately 13.9 per cent. to the Closing Price on 15 February
2018, being the last practicable trading day prior to the release
of this Announcement.
-- The final Placing Price will be determined through the Bookbuild (the "Placing Price").
-- The Bookbuild will close at such time as N+1 Singer and the
Company may determine in their absolute discretion.
-- Following the close of the Bookbuild, a further announcement
will be made as to the final number of Placing Shares to be issued
pursuant to the Placing and the Placing Price, the gross proceeds
of the Placing, the estimated net proceeds and reconfirming the
expected Admission date.
Background to and Reasons for the Placing
In summary, the net Placing proceeds will be used to enable the
Group to pay down debt and create additional headroom to help fund
expected future acquisitions, including an identified pipeline
(described more fully below) of approximately GBP40 million of
deals which the Group expects to conclude in the next six months.
This represents a continuation of the Group's existing funding and
growth strategies.
CVS is one of the UK's leading providers of integrated
veterinary services through its national network of veterinary
practices (servicing the small animal, equine and farm animal
markets), specialist referral centres, diagnostic laboratories, pet
crematoria and its on-line dispensary. The Group has demonstrated
reliable growth trends since it floated in 2007, achieved through
the implementation of its strategy to acquire and integrate
veterinary practices and other complementary operations and a range
of organic growth initiatives that benefit from CVS's scale and
integrated model. The Group's integrated offering also includes
out-of-hours centres, buying groups, and own brand products
(medicines, food, 'healthy animal' clubs and insurance). Cash
generation and the measured use of debt and equity has funded both
investment in the business and the making of acquisitions, creating
significant shareholder value since float.
The Group's well-established, integrated model covers much of
the UK and it entered the Netherlands in November 2016 with a view
to developing, over time, a business similar to that in the UK.
In the year ended 30 June 2017, the Company's last completed
financial year, CVS reported revenues of GBP271.8m, 24.6 per cent.
higher than the prior year, and an operating profit of GBP17.2m
(2016: GBP11.8m). From an acquisition perspective, 2017 saw a
continuation of strong prior trends, with the Company acquiring 62
surgeries (2016: 67 surgeries, 3 crematoria). Total acquisition
spend in the year ended 30 June 2017 was GBP48.4m (2016: GBP61.3
million). Of particular note were the acquisition of the Group's
first practices in mainland Europe, through the purchase of nine
surgeries in the Netherlands, and the acquisition of B&W Equine
in the UK, which will allow for further development of the
Company's equine business.
In a trading update released on 17 January 2018, CVS confirmed
that, since the start of the current financial year on 1 July 2017
and up to that date, the Group had made a total of 19 acquisitions
of 30 surgeries bringing its total number of surgeries to 453. The
total consideration paid for these latest acquisitions was
approximately GBP28.0m. In that trading update, CVS also reported
strong like-for-like trading in the first half of 5.6% compared to
the same period last year (after adjusting for one less trading day
compared to the half year ended 31 December 2016). Excluding the
fast growing Animed online dispensary, the figure was 3.0%. This is
in line with what the Board considers to be the longer term
industry growth rate and was a marked improvement on the
like-for-like trading growth observed at the time of the Group's
November update for the 4 months to 31 October 2017. The recent
recovery primarily reflects stronger like-for-like trading in
November and December, and also, from 1 December 2017, a price
increase on fees. On 1 January 2018, the Group increased its
Healthy Pet Club prices for new members and renewals. At the time,
the Company indicated that trading in the first half of the year
was against stronger comparatives than the second half.
The Group has also separately announced today its interim
results for the six months to 31 December 2017, confirming that, in
the half year, the Group achieved revenues of GBP157.8m, 21.9 per
cent. higher than for H1 2017. Whilst a substantial proportion of
this increase came from acquisitions, like-for-like sales grew
strongly by 5.6% (adjusted for one less day trading in the period
compared to the prior half year). GBP17.2 million of the revenue
growth reported in the period reflected the impact of acquisitions
made in the prior year, with a further GBP4.7 million of top-line
growth arising from acquisitions made during the period and from
newly opened sites. Adjusted EBITDA(1) rose by 15.5 per cent. to
GBP24.0m.
Operating profit was lower at GBP8.1m (2016: GBP9.5m) reflecting
the increase in adjusted EBITDA(1) offset by the amortisation of
intangible assets, deferred consideration and the costs of
acquisitions. Adjusted profit before tax(2) , which excludes the
amortisation of intangible assets, increased by 10.8 per cent. to
GBP18.3m (2016: GBP16.5m) and adjusted earnings per share(3) rose
by 6.5 per cent. from 21.5p to 22.9p, due to the significant
increase in adjusted EBITDA.
In its interim results release, the Group also confirmed that it
has acquired a further 4 surgeries in the UK, in the small animal
and equine segments, for a provisional cash consideration of
approximately GBP3.5m, bringing its total number of surgeries to
457.
Despite the emergence of a number of other large players, the UK
market for veterinary services still remains relatively fragmented
and the Board estimates that CVS's market share of the smaller
animal market is approximately 14 per cent. and much lower in the
farm animal and equine segments. In the past 18 months, CVS has
made its first acquisitions in the Netherlands and in Northern
Ireland, extending its geographical footprint. The Group now has 8
sites in Northern Ireland and 15 in the Netherlands, which is
regarded by the Board as being a market that shares many of the
characteristics of that of the UK. The extent of the Group's
established network in the UK and its business in the Netherlands
continue to offer significant opportunities for future acquisitive
growth.
The pipeline of acquisitions over which the Company has
visibility is strong, including approximately GBP40 million of
accepted offers (which are non-binding, subject to due diligence
and legal agreement). A significant proportion of the funding
headroom created by the Placing will enable the Company to execute,
in the coming six months, on this identified current pipeline.
Whilst a low proportion of acquisitions do not proceed as planned,
the Group's pipeline tends to replenish continually.
Over the past two-and-a-half years, the number and pace of
acquisitions made by the Group in the UK and in the Netherlands has
increased, and includes farm animal and equine as well as companion
animals, and mixed practices. The identified pipeline includes
opportunities in the UK and the Netherlands, and across all
business areas. The Group wishes to ensure it is able to continue
to acquire and integrate veterinary practices in the UK and the
Netherlands, whilst sustaining an appropriate balance between debt
and equity funding. Having considered the potential opportunities
within the Company's current pipeline of targeted acquisitions and
anticipated further acquisitions in the short and medium term, the
Directors consider it is appropriate to raise further equity
capital to help them achieve this objective.
1 Adjusted EBITDA (earnings before interest, tax, depreciation
and amortisation) is profit before income tax, net finance expense,
depreciation, amortisation, costs relating to business combinations
and exceptional items.
(2) Adjusted profit before income tax is calculated as profit on
ordinary activities before amortisation, taxation, costs relating
to business combinations and exceptional items.
(3) Adjusted earnings per share is calculated as adjusted profit
before income tax less applicable taxation divided by the weighted
average number of ordinary shares in issue during the period.
Continuing Growth Strategy
CVS has a successful track record of acquiring and integrating
veterinary practices and other complementary operations and
implementing a range of organic growth initiatives that benefit
from the Group's scale and integrated model. In addition to growth
driven by current year acquisitions, the annualisation effect of
owning acquired businesses for a full financial period, the
maturing of sites and synergies derived from recently acquired
operations, the drivers of future organic growth for the Group are
believed by the Directors to include:
-- increased membership and revenues from healthy pet club loyalty schemes;
-- the increasing number and proportion of own brand medicines and pet food;
-- greater buying power;
-- dedicated out-of-hours emergency cover;
-- increased specialist referral work;
-- increasing sales of the Group's laboratory analysis services; and,
-- growth opportunities from Animed Direct.
The Group also continues to expand its offering with the
recently introduced own brand pet insurance product, MiPet Cover,
being a key development.
The Group sees current levels of acquisition activity as
sustainable in the medium term, supported by a pipeline of
potential opportunities which remains full, even following the
period of high activity experienced over the last two-and-a-half
years. The Board considers that the markets in both the UK and the
Netherlands offer further scope for consolidation and that CVS has
an advantage in driving such business aggregation, given the merits
to vendors and to their personnel of being part of a larger
integrated group.
Following completion of the Placing, the Group will continue to
invest in its integrated model in line with those details provided
in its annual report for the year ended 30 June 2017. In addition
to pursuing further acquisitions, continued expansion of its
referrals business, development of its external sales and
laboratory analyser units, investment in its crematoria businesses
and expansion of its out-of-hours centres in order to reduce the
Group's reliance on third party providers, CVS will also continue
to invest in the training and career development of its staff and
will look to develop both managerial and operational abilities
through programmes such as its Aspirational Leadership and LEAP
programmes. The Board sees these initiatives as key to attracting,
retaining and motivating its staff and to managing the
industry-wide challenges of recruitment and retention in the UK
veterinary industry.
The Board does not currently intend to change its acquisitive or
organic growth strategies following completion of the Placing, but
to build on the many strengths of the Group's existing businesses.
The Group will also seek to continue to improve its operating
efficiency, whilst ensuring that resources remain adequate to
successfully integrate acquisitions and to develop the business
further.
Authority to Issue Shares
The Company has existing shareholder authorities to issue up to
a total of 6,391,000 Placing Shares for cash, representing
approximately 9.88 per cent. of its current total voting rights.
This includes a general authority to issue up to 3,195,500 Placing
Shares (approximately 4.94 per cent. of the Company's current total
voting rights) and a further authority to issue another 3,195,500
Placing Shares only in certain circumstances, including the
refinancing of debt utilised in the past 6 months to fund
acquisitions. The announcement of the result of the Placing will
include a list of acquisitions concluded within the six-month
period prior to the date of this announcement, for which the
Further Authority is being utilised.
The Board considers that, taken in aggregate, both the issue of
the Placing Shares and the placing undertaken by the Company in
December 2016 made, in each case, on a non pre-emptive basis, are
consistent with the Pre-Emption Group Guidelines which detail when
it is appropriate for an issuer to exceed the 7.5 per cent.
threshold for total share issuance in any rolling three-year
period. On both occasions, the Group has not only consulted with
shareholders in advance through market soundings and by providing
an explanation of the proposed new issuance, but has also explained
to shareholders the circumstances in which the Company would use
such authorities at the time they were sought (in both cases, in
the preceding Notice of Annual General Meeting and at the relevant
meeting itself).
Risks and Uncertainties
A description of the principal risks and uncertainties
associated with the Group's businesses and how they are being
managed is included in the Group's Annual Report and Accounts for
the year ended 30 June 2017 (on pages 25 and 26). The Board
considers that these principal risks and uncertainties are those
which continue to be applicable to the Group at the current
time.
Expected Timetable
Announcement of the Placing
and start of Bookbuild 7.00 a.m. on Friday
16 February 2018
Admission and commencement
of dealings 8.00 a.m. on Tuesday
in the Placing Shares 20 February 2018
Each of the times and dates refer to London time and are subject
to change by the Company (with the agreement of N+1 Singer), in
which case details of the new times and dates will be notified to
the London Stock Exchange and the Company will make an appropriate
announcement through a Regulatory Information Service.
Additional information on the Placing is included below.
Attention is drawn to the section headed 'Important Information for
Invited Placees Only Regarding the Placing' and to the Appendix
containing the terms and conditions of the Placing (representing
important information for Placees only).
The Placing Shares will be allotted under the Company's existing
shareholder authorities granted at the annual general meeting held
on 30 November 2017. The number of Placing Shares to be issued in
connection with the Placing will be agreed by CVS and N+1 Singer
following the close of the Bookbuild to further orders, and the
results of the Placing will be announced as soon as practicable
thereafter. The timing of the closing of the book, acceptance of
any orders received after a close of Bookbuild announcement, the
pricing and final allocations will be determined at the absolute
discretion of CVS and N+1 Singer. The number of Placing Shares will
not exceed 6,391,000 (representing approximately 9.88 per cent. of
the Company's existing total voting rights). Such number of Placing
Shares remains within the Company's existing shareholder
authorities to issue and allot securities on a non pre-emptive
basis, which are in accordance with the Pre-Emption Group
Guidelines.
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596 of 2014 ("MAR"). In addition,
market soundings (as defined in MAR) were taken in respect of the
Placing with the result that certain persons became aware of inside
information (as defined in MAR), as permitted by MAR. This inside
information is set out in this Announcement. Therefore, those
persons that received inside information in a market sounding are
no longer in possession of such inside information relating to the
Company and its securities.
Enquiries:
CVS Group plc Tel: 01379 644
Simon Innes, Chief Executive 288
Nick Perrin, Finance Director
N+1 Singer (Nominated Adviser, Tel: 020 7496
Sole Bookrunner & Broker) 3000
Aubrey Powell
Michael Taylor
Liz Yong
James Hopton
FORWARD LOOKING STATEMENTS
To the extent that this Announcement contains certain
forward-looking statements with respect to certain of the Group's
plans and its current goals and expectations relating to its future
financial condition and performance, a number of risks and
uncertainties exist. The Group cautions readers that any
forward-looking statement is no guarantee of future performance and
that actual results could differ materially from those contained in
the forward-looking statements.
A forward-looking statement can be identified by the fact that
it does not relate only to historical or current facts.
Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "predict" or other words of similar meaning.
Examples of forward-looking statements include, amongst others,
statements regarding or which make assumptions in respect of the
planned use of the proceeds of the Placing, the liquidity position
of the Group, the future performance of the Group, future foreign
exchange rates, interest rates and currency controls, the future
political and fiscal regimes in the overseas markets in which the
Group operates, the Group's future financial position, plans and
objectives for future operations and any other statements that are
not historical fact.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances,
including, but not limited to, economic and business conditions,
the effects of continued volatility in credit markets, market
related risks such as changes in interest rates and foreign
exchange rates, the policies and actions of governmental and
regulatory authorities, changes in legislation, the further
development of standards and interpretations under International
Financial Reporting Standards ("IFRS") applicable to past, current
and future periods, evolving practices with regard to the
interpretation and application of standards under IFRS, the outcome
of pending and future litigation or regulatory investigations, the
success of future acquisitions and other strategic transactions and
the impact of competition. A number of these factors are beyond the
Group's control. As a result, the Group's actual future results may
differ materially from the plans, goals, and expectations set forth
in the Group's forward-looking statements.
Any forward-looking statements made in this Announcement by or
on behalf of the Group speak only as of the date they are made.
These forward-looking statements reflect the Group's judgement at
the date of this Announcement and are not intended to give any
assurance as to future results. Except as required by the FCA, the
London Stock Exchange, the AIM Rules or applicable law, the Group
expressly disclaims any obligation or undertaking to release
publicly any updates or revisions to any forward looking statements
contained in this announcement to reflect any changes in the
Group's expectations with regard thereto or any changes in events,
conditions or circumstances on which any such statement is
based.
APPIX - TERMS AND CONDITIONS OF THE PLACING
UNLESS DEFINED BELOW CAPITALISED TERMS ARE AS DEFINED AT THE OF
THIS APPIX.
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING
THIS ANNOUNCEMENT, INCLUDING THIS APPIX, IS FOR INFORMATION
PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT
AND THE APPIX DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION,
SOLICITATION, RECOMMATION, OFFER OR ADVICE TO ANY PERSON TO
SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES OF
CVS GROUP PLC IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT, INCLUDING THIS APPIX AND THE INFORMATION
CONTAINED HEREIN (TOGETHER THE "ANNOUNCEMENT") 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, THE
REPUBLIC OF IRELAND, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF
SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE,
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT
HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTED
THAT IT WILL BE SO APPROVED.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS
DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN
ECONOMIC AREA ("EEA") WHO ARE QUALIFIED INVESTORS AS DEFINED IN
SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000, AS
AMED ("QUALIFIED INVESTORS"), BEING PERSONS FALLING WITHIN THE
MEANING OF 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"); AND (B) IN THE
UNITED KINGDOM, QUALIFIED INVESTORS WHO (I) ARE PERSONS HAVING
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING
WITHIN ARTICLE 19(5) (INVESTMENT PROFESSIONALS) OF THE FINANCIAL
SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS
AMED (THE "ORDER"); (II) ARE PERSONS FALLING WITHIN ARTICLE
49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS, ETC.) OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT
MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER
BEING REFERRED TO AS "RELEVANT PERSONS").
THIS 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 CVS GROUP PLC.
INFORMATION TO DISTRIBUTORS
FOR THE PURPOSES OF THE PRODUCT GOVERNANCE REQUIREMENTS OF EACH
OF (A) EU DIRECTIVE 2014/65/EU ON MARKETS IN FINANCIAL INSTRUMENTS,
AS AMED ("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 FOR NO OTHER PURPOSES, N+1 SINGER HAS CARRIED
OUT AN ASSESSMENT OF THE ORDINARY SHARES AND HAS DETERMINED THEM TO
BE: (I) COMPATIBLE WITH AN TARGET MARKET OF RETAIL INVESTORS AND
INVESTORS WHO MEET THE CRITERIA OF PROFESSIONAL CLIENTS AND
ELIGIBLE COUNTERPARTIES, EACH AS DEFINED UNDER THE FCA'S CONDUCT OF
BUSINESS SOURCEBOOK; AND (II) ELIGIBLE FOR DISTRIBUTION THROUGH ALL
DISTRIBUTION CHANNELS AS ARE PERMITTED BY MIFID II (THE "TARGET
MARKET ASSESSMENT").
ALL DISTRIBUTORS SHOULD NOTE THAT: THE PRICE OF ORDINARY SHARES
MAY DECLINE AND INVESTORS COULD LOSE ALL OR PART OF THEIR
INVESTMENT; THE ORDINARY SHARES OFFER NO CERTAINTY OF INCOME AND NO
CAPITAL PROTECTION; AND AN INVESTMENT IN THE ORDINARY SHARES IS
COMPATIBLE ONLY WITH INVESTORS WHO: (I) DO NOT NEED A CERTAIN AND
PROTECTED INCOME OR CAPITAL PROTECTION; AND (II) (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 HAVE SUFFICIENT RESOURCES TO BE ABLE TO BEAR ANY LOSSES THAT
MAY RESULT THEREFROM. THE TARGET MARKET ASSESSMENT IS ADDITIONAL TO
THE RESTRICTIONS CONTAINED WITHIN THE TERMS OF THE PLACING. IN ALL
CIRCUMSTANCES, N+1 SINGER 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 OTHERWISE; OR (B) A RECOMMATION TO
ANY INVESTOR OR GROUP OF INVESTORS TO INVEST IN, OR PURCHASE, OR
TAKE ANY OTHER ACTION WHATSOEVER WITH RESPECT TO THE ORDINARY
SHARES.
EACH DISTRIBUTOR IS RESPONSIBLE FOR UNDERTAKING ITS OWN TARGET
MARKET ASSESSMENT IN RESPECT OF THE ORDINARY SHARES AND DETERMINING
APPROPRIATE DISTRIBUTION CHANNELS.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO
THE UNITED STATES. 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. SUBJECT TO CERTAIN
EXCEPTIONS AND AT THE SOLE DISCRETION OF THE COMPANY, 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, THE UNITED KINGDOM OR
ELSEWHERE. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY
PERSON INSIDE THE UNITED STATES IS BEING SOLICITED AND, IF SENT IN
RESPONSE TO THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL
NOT BE ACCEPTED.
EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX,
BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.
THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY
INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN
JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS
ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT
COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH
RESTRICTIONS.
No action has been taken by the Company, N+1 Singer 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 the Placing Shares in
any jurisdiction where action for that purpose is required.
This Announcement or any part of it 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), Canada, the Republic
of Ireland, Australia, the Republic of South Africa, 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 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 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 offered
in compliance with the securities laws of any state, province or
territory of Australia, Canada, Japan, the Republic of Ireland or
the Republic of South Africa or in any other jurisdiction.
Accordingly, the Placing Shares may not (unless an exemption under
relevant securities laws is applicable) be offered, sold, resold or
delivered, directly or indirectly, in or into the United States,
Australia, Canada, Japan, the Republic of Ireland or the Republic
of South Africa or any other jurisdiction outside the United
Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligation 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 this
"Important Information" section of this Announcement.
Each person who is invited to and who chooses to participate in
the Placing (a "Placee") will be deemed to have read and understood
this Announcement in its entirety, to be participating, making an
offer and subscribing for 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 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 Placing Shares pursuant to the
Placing:
2.1 it is a Qualified Investor within the meaning of Article
2(1)(e) of the Prospectus Directive;
2.2 in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the
Prospectus Directive:
2.2.1 the Placing Shares acquired by it in the 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 N+1 Singer has been given to the offer or resale;
or
2.2.2 where Placing Shares have been acquired by it on behalf of
persons in any member state of the EEA other than Qualified
Investors, the offer of those Placing Shares to it is not treated
under the Prospectus Directive as having been made to such
persons;
3 it is acquiring the Placing Shares for its own account or is
acquiring the 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;
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 3 above) is outside the United
States acquiring the Placing Shares in offshore transactions as
defined in and in accordance with Regulation S under the Securities
Act.
No prospectus
No prospectus or other offering document has been or will be
submitted to be approved by the FCA or any other regulatory body in
any Relevant Member State in relation to the Placing or the 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 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 Form of Confirmation to be sent
to individual Placees.
Each Placee, by participating in the Placing, agrees that the
content of this Announcement is exclusively the responsibility of
the Company and confirms that it has neither received nor relied on
any information (other than the Publicly Available Information),
representation, warranty or statement made by or on behalf of N+1
Singer, the Company or any other person and none of N+1 Singer, the
Company or 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 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 Placing. Nothing in
this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
Details of the Placing Agreement and the Placing Shares
N+1 Singer has today entered into the Placing Agreement with the
Company under which, on the terms and subject to the conditions set
out in the Placing Agreement, N+1 Singer, as agent for and on
behalf of the Company, has agreed to use its reasonable endeavours
to procure Placees to subscribe for the Placing Shares at the
Placing Price, such subscription commitments being conditional upon
the conditions (summarised below) being satisfied by the Company or
otherwise waived by N+1 Singer.
The Placing Shares will, when issued, be subject to the articles
of association of the Company and credited as fully paid and will
rank pari passu in all respects with the Existing Ordinary Shares,
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.
Application for admission to trading
Application will be made to the London Stock Exchange for
admission of the Placing Shares to trading on AIM.
It is expected that Admission will take place at 8.00 a.m. on or
around 20 February 2018 and that dealings in the Placing Shares on
AIM will commence at the same time.
Principal terms of the Placing
1 N+1 Singer is acting as nominated adviser, financial adviser
and broker to the Placing, as agent for and on behalf of the
Company. N+1 Singer is authorised and regulated in the United
Kingdom by the FCA and is acting exclusively for the Company and no
one else in connection with the matters referred to in this
Announcement and will not be responsible to anyone other than the
Company for providing the protections afforded to the customers of
N+1 Singer or for providing advice in relation to the matters
described in this Announcement.
2 Participation in the Placing will only be available to persons
who may lawfully be, and are, invited by N+1 Singer to participate.
N+1 Singer and any of its respective affiliates are entitled to
participate in the Placing as principal.
3 The price per Placing Share will be payable by all Placees to
N+1 Singer (as agent of the Company). The Placing Price and number
of Placing Shares will be agreed between the Company and N+1 Singer
at the close of the Bookbuild and confirmed to Placees by telephone
and/or email along with their final allocation, and will be
disclosed in the announcement confirming the result of the
Placing.
4 Each Placee's allocation is determined by N+1 Singer in its
discretion following consultation with the Company and has been or
will be confirmed orally by N+1 Singer and a Form of Confirmation
will be dispatched as soon as possible thereafter. That oral
confirmation will give rise to an irrevocable, legally binding
commitment by that person (who at that point becomes a Placee), in
favour of N+1 Singer and the Company, under which it agrees to
acquire the number of Placing Shares allocated to the Placee at the
Placing Price and otherwise on the terms and subject to the
conditions set out in this Appendix and in accordance with the
Company's articles of association. Except with N+1 Singer's prior
written consent, such commitment will not be capable of variation
or revocation at the time at which it is submitted.
5 Each Placee's allocation and commitment will be evidenced by a
Form of Confirmation issued to such each Placee by N+1 Singer. The
terms of this Appendix will be deemed incorporated in that Form of
Confirmation.
6 Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to N+1 Singer (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 Placing
Shares such Placee has agreed to acquire and the Company has agreed
to allot and issue to that Placee.
7 Irrespective of the time at which a Placee's allocation(s)
pursuant to the Placing is/are confirmed, settlement for all
Placing Shares to be issued pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under "Registration and Settlement".
8 All obligations of N+1 Singer 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".
9 By participating in the Placing, each Placee will agree that
its rights and obligations in respect of the Placing will terminate
only in the circumstances described below and will not be capable
of rescission or termination by the Placee.
10 To the fullest extent permissible by law and applicable FCA
rules, none of (a) N+1 Singer, (b) any of N+1 Singer's affiliates,
agents, directors, officers, consultants, (c) to the extent not
contained within (a) or (b), any person connected with N+1 Singer
as defined in FSMA ((b) and (c) being together "affiliates" and
individually an "affiliate" of N+1 Singer) or (d) any person acting
on N+1 Singer's behalf, 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 N+1 Singer nor any of its respective
affiliates shall have any liability (including, to the extent
permissible by law, any fiduciary duties) in respect of their
conduct of the Placing or of such alternative method of effecting
the Placing as N+1 Singer and the Company may agree.
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing they
will be sent a Form of Confirmation by N+1 Singer, as soon as it is
able, which will confirm the number of Placing Shares allocated to
them, the Placing Price and the aggregate amount owed by them to
N+1 Singer (as agent for the Company).
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 N+1 Singer in accordance with either the standing CREST
or certificated settlement instructions which they have in place
with N+1 Singer.
Settlement of transactions in the Placing Shares (ISIN:
GB00B2863827) following Admission will take place within the CREST
system, subject to certain exceptions. Settlement through CREST is
expected to take place on 20 February 2018 unless otherwise
notified by N+1 Singer and Admission is expected to occur no later
than 8.00 a.m. on 20 February 2018 unless otherwise notified by N+1
Singer. Admission and settlement may occur at an earlier date
which, if achievable, will be notified through a Regulatory
Information Service. 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 N+1 Singer may agree
that the Placing Shares should be issued in certificated form. N+1
Singer reserves the right to require settlement for the Placing
Shares, and to deliver the Placing Shares to Placees, by such other
means as it deems necessary if delivery or settlement to Placees is
not practicable within the CREST system or would not be consistent
with regulatory requirements in a Placee's jurisdiction.
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 2 percentage points above prevailing LIBOR as
determined by N+1 Singer.
Each Placee agrees that, if it does not comply with these
obligations, N+1 Singer may sell, charge by way of security (to any
funder of N+1 Singer) or otherwise deal with any or all of their
Placing Shares on their behalf and retain from the proceeds, for
N+1 Singer's own account and benefit, an amount equal to the
aggregate amount owed by the Placee plus any interest due and any
costs and expenses properly incurred by N+1 Singer as a result of
the Placee's failure to comply with its obligations. The relevant
Placee will, however, remain liable for any shortfall below the
amount owed by it and for any stamp duty or stamp duty reserve tax
(together with any interest or penalties) which may arise upon the
sale of their Placing Shares on their behalf. Legal and/or
beneficial title in and to any Placing Shares shall not pass to the
relevant Placee until such time as it has fully complied with its
obligations hereunder.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional Form of Confirmation is copied and delivered
immediately to the relevant person within that organisation.
Insofar as Placing Shares are registered in a Placee's name or that
of its nominee or in the name of any person for whom a Placee is
contracting as agent or that of a nominee for such person, such
Placing Shares should, subject as provided below, be so registered
free from any liability to United Kingdom stamp duty or stamp duty
reserve tax. Placees will not be entitled to receive any fee or
commission in connection with the 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 N+1 Singer under the Placing Agreement are,
and the Placing is, conditional upon, inter alia:
(a) none of the warranties or undertakings on the part of the
Company contained in the Placing Agreement being or having become
untrue, inaccurate or misleading at any time before Admission, and
no fact or circumstance having arisen which would constitute a
breach of any of the warranties or undertakings given in the
Placing Agreement or which would have a Material Adverse
Effect;
(b) the performance by the Company of its obligations under the
Placing Agreement to the extent they fall to be performed prior to
Admission;
(c) no matter having arisen before Admission which might
reasonably be expected to give rise to an indemnity claim under the
Placing Agreement;
(d) each condition to enable the Placing Shares to be admitted
as participating securities (as defined in the Regulations) in
CREST (other than Admission) and enabled for settlement being
satisfied on or before 8.00 a.m. on the date of Admission; and
(e) Admission occurring by not later than 8.00 a.m. on 2 March
2018 (or such later date as the Company and N+1 Singer may agree in
writing, in any event being not later than 16 March 2018),
(all conditions to the obligations of N+1 Singer included in the
Placing Agreement being together, the "conditions").
If any of the conditions are 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 N+1
Singer may agree, provided that the time for satisfaction of the
condition set out in (e) above shall not be extended beyond 8.00
a.m. on 16 March 2018), or the Placing Agreement is terminated in
accordance with its terms, the Placing will lapse and the Placees
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 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.
Certain conditions may be waived in whole or in part by N+1
Singer, in its absolute discretion by notice in writing to the
Company and N+1 Singer may also agree in writing with the Company
to extend the time for satisfaction of any condition. Any such
extension or waiver will not affect Placees' commitments as set out
in this Announcement.
N+1 Singer may terminate the Placing Agreement in certain
circumstances, details of which are set out below.
Neither N+1 Singer, the Company nor any of their respective
affiliates, agents, directors, officers or employees 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 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 N+1 Singer.
Termination of the Placing
N+1 Singer may terminate the Placing Agreement, in accordance
with its terms, at any time prior to Admission if, inter alia:
1 it comes to the attention of N+1 Singer that any of the
warranties on the part of the Company contained in the Placing
Agreement were not true or accurate, or were misleading when given
or deemed given; or
2 it comes to the attention of N+1 Singer that the Company has
failed to comply with its obligations under the Placing Agreement,
FSMA, the AIM Rules or other applicable law; or
3 it comes to the attention of N+1 Singer that any statement
contained in the Placing Materials has become or been discovered to
be untrue, inaccurate or misleading in any material respect; or
4 there shall have developed or occurred any act of terrorism,
outbreak of hostilities, change in national or international
financial, monetary, economic, political or market conditions,
including fluctuation in exchange rates, which would have a
Material Adverse Effect.
If the Placing Agreement is terminated in accordance with its
terms, the rights and obligations of each Placee in respect of the
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 Placing, each Placee agrees with the
Company and N+1 Singer that the exercise by the Company or N+1
Singer 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 N+1 Singer and that neither the
Company nor N+1 Singer need make any reference to such Placee and
that neither N+1 Singer, the Company, 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 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 N+1 Singer of a Form of Confirmation confirming
each Placee's allocation and commitment in the Placing.
Representations, warranties and further terms
By participating in the 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 N+1 Singer expressly agrees in writing to the
contrary):
1 it has read and understood this Announcement in its entirety
and that its subscription for the 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; 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, 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 Placing Shares and has
relied on its own investigation of the business, financial and
trading position of the Company in accepting a participation in the
Placing and neither N+1 Singer, the Company nor any of their
respective affiliates, agents, directors, officers or employees or
any person acting on behalf of any of them has provided, and will
not provide, it with any material regarding the 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 any of N+1 Singer, the Company, any of their respective
affiliates, agents, directors, officers or employees or any person
acting on behalf of any of them to provide it with any such
information;
5 neither N+1 Singer, the Company, any person acting on behalf
of either of them or 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 the only information on which it is entitled to rely and on
which it has relied in committing to subscribe for the 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 Placing Shares and it has made its own
assessment of the Company, the Placing Shares and the terms of the
Placing based on Publicly Available Information;
7 neither N+1 Singer, the Company nor any of their respective
affiliates, agents, directors, officers or employees has 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;
8 it has conducted its own investigation of the Company, the
Placing and the 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 Placing; and
9 it has not relied on any investigation that N+1 Singer, the
Company or any person acting on their behalf may have conducted
with respect to the Company, the Placing or the Placing Shares;
10 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 N+1 Singer nor any
person acting on behalf of it 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 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;
11 the 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 Placing Shares under the securities laws of
the United States, or any state or other jurisdiction of the United
States, the Republic of Ireland, 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, the Republic of
Ireland, Australia, Canada, the Republic of South Africa or Japan
or in any country or jurisdiction where any such action for that
purpose is required;
12 it and/or each person on whose behalf it is participating:
12.1 is entitled to acquire Placing Shares pursuant to the
Placing under the laws and regulations of all relevant
jurisdictions;
12.2 has fully observed such laws and regulations;
12.3 has capacity and authority and is entitled to enter into
and perform its obligations as an acquirer of Placing Shares and
will honour such obligations; and
12.4 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 subscription for Placing
Shares;
13 it is not, and any person who it is acting on behalf of is
not, and at the time the Placing Shares are subscribed for will not
be, a resident of, or with an address in, or subject to the laws
of, Australia, Canada, Japan, the Republic of Ireland or the
Republic of South Africa, and it acknowledges and agrees that the
Placing Shares have not been and will not be registered or
otherwise qualified under the securities legislation of Australia,
Canada, Japan, the Republic of Ireland or the Republic of South
Africa and may not be offered, sold, or acquired, directly or
indirectly, within those jurisdictions;
14 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 re-offer, resale, pledge or transfer of the Placing
Shares;
15 it and the beneficial owner of the Placing Shares is, and at
the time the Placing Shares are acquired will be, outside the
United States and acquiring the Placing Shares in an "offshore
transaction" as defined in, and in accordance with, Regulation S
under the Securities Act;
16 it (and any account for which it is purchasing) is not
acquiring the Placing Shares with a view to any offer, sale or
distribution thereof within the meaning of the Securities Act;
17 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 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;
18 neither N+1 Singer, its respective affiliates, agents,
directors, officers or employees nor 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 Placing and that participation in the Placing
is on the basis that it is not and will not be a client of N+1
Singer and N+1 Singer has no duties or responsibilities to it for
providing the protections afforded to its clients or for providing
advice in relation to the Placing nor in respect of any
representations, warranties, undertakings or indemnities contained
in the Placing Agreement nor for the exercise or performance of any
of its rights and obligations thereunder including any rights to
waive or vary any conditions or exercise any termination right;
19 it has the funds available to pay for the Placing Shares for
which it has agreed to subscribe and acknowledges and agrees that
it will make payment to N+1 Singer for the 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 Placing Shares may be
placed with others on such terms as N+1 Singer may, in its absolute
discretion determine 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 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 Placing Shares on its behalf;
20 no action has been or will be taken by any of the Company,
N+1 Singer or any person acting on their behalf that would, or is
intended to, permit a public offer of the Placing Shares in the
United States or in any country or jurisdiction where any such
action for that purpose is required;
21 the person who it specifies for registration as holder of the
Placing Shares will be: (a) the Placee; or (b) a nominee of the
Placee, as the case may be. Neither N+1 Singer nor the Company will
be responsible for any liability to stamp duty or stamp duty
reserve tax resulting from a failure to observe this requirement.
Each Placee and any person acting on behalf of such Placee agrees
to acquire Placing Shares pursuant to the Placing and agrees to pay
the Company and N+1 Singer in respect of the same (including any
interest or penalties) on the basis that the Placing Shares will be
allotted to a CREST stock account of N+1 Singer or transferred to a
CREST stock account of N+1 Singer which will hold them as nominee
on behalf of the Placee until settlement in accordance with its
standing settlement instructions with it;
22 it is acting as principal only in respect of the Placing or,
if it is acting for any other person, (a) it is duly authorised to
do so and has full power to make the acknowledgments,
representations and agreements herein on behalf of each such person
and (b) it is and will remain liable to the Company and N+1 Singer
for the performance of all its obligations as a Placee in respect
of the Placing (regardless of the fact that it is acting for
another person);
23 the allocation, allotment, issue and delivery to it, or the
person specified by it for registration as holder, of 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 Placing
as nominee or agent for any person or persons to whom the
allocation, allotment, issue or delivery of Placing Shares would
give rise to such a liability;
24 it will not make an offer to the public of the Placing Shares
and it has not offered or sold and will not offer or sell any
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 FSMA or an offer to the public in any other
member state of the EEA within the meaning of the Prospectus
Directive;
25 it and any person acting on its behalf (if within the United
Kingdom) is a person of a kind described in: (a) Article 19(5)
(Investment Professionals) and/or 49(2) (High net worth companies
etc.) of the Order and/or an authorised person as defined in
section 31 of FSMA; and (b) section 86(7) of FSMA ("Qualified
Investor"), being a person falling within Article 2.1(e) of the
Prospectus Directive. For such purposes, it undertakes that it will
acquire, hold, manage and (if applicable) dispose of any Placing
Shares that are allocated to it for the purposes of its business
only;
26 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 FSMA) relating to Placing Shares in circumstances in
which section 21(1) of FSMA does not require approval of the
communication by an authorised person and it acknowledges:
26.1 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 Placing Shares (including all relevant provisions of FSMA in
respect of anything done in, from or otherwise involving the United
Kingdom);
26.2 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 Placing Shares
acquired by it in the Placing will not be acquired on a
non-discretionary basis on behalf of, nor will they be acquired
with a view to their offer or resale to, persons in a member state
of the EEA which has implemented the Prospectus Directive other
than Qualified Investors, or in circumstances in which the express
prior written consent of N+1 Singer has been given to the offer or
resale;
26.3 (other than as set out in the Placing Materials) it has
neither received nor relied on any confidential price sensitive
information about the Company in accepting this invitation to
participate in the Placing;
26.4 neither N+1 Singer nor any of its respective affiliates,
agents, directors, officers or employees or any person acting on
behalf of any of them has or shall have any liability for any
information, representation or statement contained in this
Announcement or for any information previously published by or on
behalf of the Company or any other written or oral information made
available to or publicly available or filed or any representation,
warranty or undertaking relating to the Company, and will not be
liable for its decision to participate in the Placing based on any
information, representation, warranty or statement contained in
this Announcement or elsewhere, provided that nothing in this
paragraph shall exclude any liability of any person for fraud;
26.5 neither N+1 Singer, the Company nor any of their respective
affiliates, agents, directors, officers or employees or any person
acting on behalf of N+1 Singer, the Company or their respective
affiliates, agents, directors, officers or employees is making any
recommendations to it or advising it regarding the suitability of
any transactions it may enter into in connection with the Placing
nor providing advice in relation to the Placing nor in respect of
any representations, warranties, acknowledgements, agreements,
undertakings or indemnities contained in the Placing Agreement nor
the exercise or performance of N+1 Singer's rights and obligations
thereunder including any rights to waive or vary any conditions or
exercise any termination right;
26.6 acknowledges and accepts that N+1 Singer may, in accordance
with applicable legal and regulatory provisions, engage in
transactions in relation to the Placing Shares and/or related
instruments for its own account for the purpose of hedging its
underwriting exposure or otherwise and, except as required by
applicable law or regulation, N+1 Singer will not make any public
disclosure in relation to such transactions;
26.7 N+1 Singer and each of its affiliates, each acting as an
investor for its or their own account(s), may bid or subscribe for
and/or purchase Placing Shares and, in that capacity, may retain,
purchase, offer to sell or otherwise deal for its or their own
account(s) in the Placing Shares, any other securities of the
Company or other related investments in connection with the Placing
or otherwise. Accordingly, references in this Announcement to the
Placing Shares being offered, subscribed, acquired or otherwise
dealt with should be read as including any offer to, or
subscription, acquisition or dealing by N+1 Singer and/or any of
its affiliates, acting as an investor for its or their own
account(s). Neither N+1 Singer 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;
26.8 it has complied with its obligations in connection with
money laundering and terrorist financing under the Proceeds of
Crime Act 2002, the Terrorism Act 2000, the Terrorism Act 2006 and
the Money Laundering, Terrorist Financing and Transfer of Funds
(Information on the Payer) Regulations 2017 (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;
26.9 it is aware of the obligations regarding insider dealing in
the Criminal Justice Act 1993, FSMA, the EU Market Abuse Regulation
No. 596 of 2014 and the Proceeds of Crime Act 2002 and confirms
that it has and will continue to comply with those obligations;
26.10 in order to ensure compliance with the Money Laundering,
Terrorist Financing and Transfer of Funds (Information on the
Payer) Regulations 2017, N+1 Singer (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 N+1 Singer or the Company's registrars, as
applicable, of evidence of identity, definitive certificates in
respect of the Placing Shares may be retained at N+1 Singer's
absolute discretion or, where appropriate, delivery of the Placing
Shares to it in uncertificated form may be delayed at N+1 Singer'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 N+1 Singer (for itself and as agent on
behalf of the Company) or the Company's registrars have not
received evidence satisfactory to them, N+1 Singer and/or the
Company may, at its absolute discretion, terminate its commitment
in respect of the Placing, in which event the monies payable on
acceptance of allotment will, if already paid, be returned without
interest to the account of the drawee's bank from which they were
originally debited;
26.11 acknowledges that its commitment to acquire Placing Shares
on the terms set out in this Announcement and in the Form of
Confirmation will continue notwithstanding any amendment that may
in future be made to the terms and conditions of the Placing and
that Placees will have no right to be consulted or require that
their consent be obtained with respect to the Company's or N+1
Singer's conduct of the Placing;
26.12 it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of subscribing for the Placing Shares. It further
acknowledges that it is experienced in investing in securities of
this nature and is aware that it may be required to bear, and is
able to bear, the economic risk of, and is able to sustain, a
complete loss in connection with the Placing. It has relied upon
its own examination and due diligence of the Company and its
affiliates taken as a whole, and the terms of the Placing,
including the merits and risks involved;
26.13 it irrevocably appoints any duly authorised officer of N+1
Singer 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
Placing Shares for which it agrees to subscribe upon the terms of
this Announcement;
26.14 the Company, N+1 Singer and others (including each of
their respective affiliates, agents, directors, officers or
employees) will rely upon the truth and accuracy of the foregoing
representations, warranties, acknowledgements and agreements, which
are given to N+1 Singer, on its own behalf and on behalf of the
Company and are irrevocable;
26.15 if it is acquiring the Placing Shares as a fiduciary or
agent for one or more investor accounts, it has full power and
authority to make, and does make, the foregoing representations,
warranties, acknowledgements, agreements and undertakings on behalf
of each such account;
26.16 time is of the essence as regards its obligations under this Appendix;
26.17 any document that is to be sent to it in connection with
the Placing will be sent at its risk and may be sent to it at any
address provided by it to N+1 Singer;
26.18 the Placing Shares will be issued subject to the terms and
conditions of this Appendix; and
26.19 these terms and conditions 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 shares pursuant to the 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 any such contract, except
that enforcement proceedings in respect of the obligation to make
payment for the Placing Shares (together with any interest
chargeable thereon) may be taken by the Company or N+1 Singer in
any jurisdiction in which the relevant Placee is incorporated or in
which any of its securities have a quotation on a recognised stock
exchange.
27 by participating in the Placing, each Placee (and any person
acting on such Placee's behalf) agrees to indemnify and hold the
Company, N+1 Singer 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 N+1 Singer, 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 remain in full force and
effect after completion of the Placing. The agreement to allot and
issue 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 Placing
Shares are not being acquired in connection with arrangements to
issue depositary receipts or to transfer the Placing Shares into a
clearance service. If there are any such arrangements, or the
settlement related to any other dealings in the 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 N+1 Singer
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
should notify N+1 Singer 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
Placing Shares or the agreement by them to acquire any 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
Placing as an agent or nominee) the allocation, allotment, issue or
delivery of 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 N+1 Singer in the event that either the Company
and/or N+1 Singer has incurred any such liability to such taxes or
duties.
28 The representations, warranties, acknowledgements and
undertakings contained in this Appendix are given to N+1 Singer for
itself and on behalf of the Company and are irrevocable.
29 Each Placee and any person acting on behalf of the Placee
acknowledges that N+1 Singer does 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.
30 Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that N+1 Singer may (at its absolute
discretion) satisfy its obligation to procure Placees by itself
agreeing to become a Placee in respect of some or all of the
Placing Shares or by nominating any connected or associated person
to do so.
31 When a Placee or any person acting on behalf of the Placee is
dealing with N+1 Singer, any money held in an account with N+1
Singer on behalf of the Placee and/or any person acting on behalf
of the Placee will not be treated as client money within the
meaning of the relevant rules and regulations of the FCA made under
FSMA. 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 N+1 Singer's
money (as applicable) in accordance with the client money rules and
will be held by it under a banking relationship and not as
trustee.
32 References to time in this Announcement are to London time, unless otherwise stated.
33 All times and dates in this Announcement may be subject to amendment.
34 No statement in this Announcement is intended to be a profit
forecast, and no statement in this Announcement should be
interpreted to mean that earnings per share of the Company for the
current or future financial years would necessarily match or exceed
the historical published earnings per share of the Company.
35 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 Placing Shares. Past performance is
no guide to future performance, and persons needing advice should
consult an independent financial adviser.
36 The Placing Shares to be issued or sold pursuant to the
Placing will not be admitted to trading on any stock exchange other
than the London Stock Exchange.
37 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.
DEFINITIONS
The following definitions apply in this Appendix to the
Announcement and, as the context shall admit, in the
Announcement:
"Admission" admission of the Placing Shares to trading on
AIM;
"AIM" AIM, a market operated by the London Stock Exchange;
"AIM Rules" the AIM Rules for Companies and/or the AIM Rules for
Nominated Advisers as applicable, published by the London Stock
Exchange;
"Announcement" this Announcement;
"Closing Price" the closing middle market quotation of an
Ordinary Share as derived from the AIM Appendix to the Daily
Official List of the London Stock Exchange;
"Company" or "CVS" CVS Group plc, a company incorporated in
England and Wales with registered number 06312831 with its
registered office at CVS House, Owen Road, Diss, Norfolk IP22
4ER;
"CREST" the computerised settlement system to facilitate
transfer of the title to an interest in securities in
uncertificated form operated by Euroclear UK and Ireland
Limited;
"Directors" or the "Board" the directors of the Company on the
date of this Announcement;
"Existing Ordinary Shares" the 64,658,875 Ordinary Shares in
issue as at the date of this Announcement;
"FCA" the Financial Conduct Authority of the United Kingdom;
"FSMA" the Financial Services and Markets Act 2000 (as
amended);
"Form of Confirmation" the form of confirmation or electronic
confirmation to be despatched by N+1 Singer to each Placee in
connection with the Placing following receipt of each Placee's firm
order;
"Further Authority" the authority to issue up to 3,195,500 new
Ordinary Shares on a non pre-emptive basis, for use only for the
purposes of financing (or refinancing within six months of the date
of acquisition) a transaction which the Directors determine to be
an acquisition or other capital investment of a kind contemplated
by the Pre-Emption Group Guidelines obtained at the Company's
annual general meeting on 30 November 2017
"Group" the Company and its subsidiary undertakings;
"London Stock Exchange" London Stock Exchange plc;
"Material Adverse Effect" an effect which in the opinion of N+1
Singer (acting in good faith):
(a) is or will or is likely to be materially prejudicial to the
prospects or financial position of the Company; and which
(b) by itself or together with any other such occurrence, is
material in the context of the Placing;
"N+1 Singer" Nplus1 Singer Advisory LLP, acting as nominated
adviser and broker to the Company in respect of the Placing, and
where the context allows, its affiliates;
"Ordinary Shares" the ordinary shares of 0.2 pence each in the
capital of the Company;
"Placees" those persons procured by N+1 Singer acting as agent
for the Company who have agreed to subscribe for all or any of the
Placing Shares pursuant to the Placing;
"Placing" the conditional placing by N+1 Singer on behalf of the
Company of the Placing Shares at the Placing Price, in accordance
with the Placing Agreement;
"Pre-Emption Group Guidelines" the Pre-Emption Group's Statement
of Principles on Disapplying Pre-Emption Rights;
"Placing Agreement" the agreement dated 16 February 2018 between
the Company and N+1 Singer relating to the Placing;
"Placing Materials" this Announcement and any other announcement
issued in connection with the Placing via a Regulatory Information
Service and any other material prepared by the Company and provided
to prospective investors by it in connection with the Placing;
"Placing Price" the price at which the Placing Shares are to be
placed with Placees, to be determined via the Bookbuild and
notified via a Regulatory Information Service;
"Placing Shares" up to 6,391,000 new Ordinary Shares; and
"Regulatory Information Service" a regulatory information
service approved by the London Stock Exchange for the distribution
of AIM announcements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOESFLEFIFASELE
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February 16, 2018 02:01 ET (07:01 GMT)
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