TIDMGMS
RNS Number : 2392B
Gulf Marine Services PLC
09 June 2021
THIS ANNOUNCEMENT (INCLUDING THE APPICES) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN,
INTO OR FROM 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. PLEASE SEE
THE IMPORTANT NOTICES AT THE OF THIS ANNOUNCEMENT.
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A
PROSPECTUS OR PROSPECTUS EXEMPTED DOCUMENT. NOTHING HEREIN SHALL BE
CONSTRUED AS ANY OFFER, INVITATION OR RECOMMATION TO PURCHASE, SELL
OR SUBSCRIBE FOR ANY SECURITIES IN ANY JURISDICTION AND NEITHER THE
ISSUE OF INFORMATION NOR ANYTHING CONTAINED HEREIN SHALL FORM THE
BASIS OF OR BE RELIED UPON IN CONNECTION WITH, OR ACT AS AN
INDUCEMENT TO ENTER INTO, ANY INVESTMENT ACTIVITY.
ANY DECISION TO PURCHASE, SUBSCRIBE FOR, OTHERWISE ACQUIRE, SELL
OR OTHERWISE DISPOSE OF SECURITIES MENTIONED HEREIN MUST BE MADE
ONLY ON THE BASIS OF THE INFORMATION CONTAINED IN AND INCORPORATED
BY REFERENCE INTO THE PROSPECTUS.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF REGULATION (EU) NO 596/2014 AS IT FORMS PART OF
DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT
2018.
9 June 2021
Gulf Marine Services plc
Proposed Placing and Open Offer to raise GBP20.0 million
Introduction
Gulf Marine Services plc (LSE: GMS)("GMS", the "Company" or,
together with its subsidiary undertakings, the "Group") is today
pleased to announce a proposed capital raising (the "Capital
Raising"), comprising:
(i) a placing (the "Placing") of 370,706,162 new ordinary shares
of 2 pence each ("Ordinary Shares") in the capital of the Company
(the "New Ordinary Shares") at a price of 3 pence per New Ordinary
Share (the "Issue Price"), subject to a right of recall to satisfy
valid applications by Qualifying Shareholders pursuant to the Open
Offer (as defined below) (the "Placing Shares"); and
(ii) an open offer pursuant to which Qualifying Shareholders
will be given the opportunity to subscribe for an aggregate of
665,926,795 New Ordinary Shares (the "Open Offer Shares") at the
Issue Price through an open offer (the "Open Offer").
Seafox International Limited ("Seafox"), Mazrui Investments LLC
("Mazrui") and a third existing institutional investor in the
Company (together with Seafox and Mazrui, the "Committed
Shareholders"), who hold, in aggregate, 44.33 per cent. of the
existing Ordinary Shares currently in issue, have irrevocably
undertaken to take up their respective entitlements under the Open
Offer in full in respect of, in aggregate, 295,220,633 New Ordinary
Shares (the "Committed Shares").
The Placing has been fully underwritten by Panmure Gordon (UK)
Limited ("Panmure Gordon") on the terms and subject to the
conditions set out in the Placing Agreement (as defined below).
As the nominal value of each of the existing Ordinary Shares
(the "Existing Ordinary Shares") is 10 pence, in order to provide
flexibility to the Company on the price at which new Ordinary
Shares can be issued, the share capital will be reorganised (the
"Reorganisation"). Immediately prior to the Capital Raising taking
effect, each of the Existing Ordinary Shares will be sub-divided
and re-designated into one new Ordinary Share with a nominal value
of 2 pence, and one deferred share with a nominal value of 8 pence
("Deferred Shares"). All of the Deferred Shares will be subject to
a right of repurchase by the Company for an aggregate sum of GBP1
following Admission, and the board of the Company intends to effect
such repurchase in due course. The Reorganisation will take effect
on Admission, and will not affect the number of ordinary shares in
issue. Each Ordinary Share with a nominal value of 2 pence will
carry the same rights and represent the same proportionate interest
in the Company that currently apply to the Existing Ordinary
Shares.
Panmure Gordon is acting as sole sponsor, sole global
co-ordinator and joint bookrunner in connection with the Placing
and will commence a bookbuilding process (the "Bookbuilding
Process") in respect of the Placing immediately following the
publication of this Announcement. Emirates NBD Capital Limited
("ENBD" and together with Panmure Gordon, the "Joint Bookrunners")
is acting as regional joint bookrunner in the Middle East in
connection with the Placing.
Details of the results of the Placing will be announced as soon
as practicable after the close of the Bookbuilding Process.
Highlights
-- Placing to raise up to GBP11.1 million (before expenses) through the issue of up to 370,706,162 Placing Shares at
the Issue Price. The Placing Shares are being placed subject to a right of recall to satisfy Open Offer
Entitlements taken up by Qualifying Shareholders.
-- Seafox, Mazrui and a third existing institutional investor in the Company, who hold, respectively, 29.99, 13.33
and 1.01 per cent. of the Existing Ordinary Shares, have irrevocably undertaken to take up their respective
entitlements under the Open Offer in full and those shares are therefore not subject to the Placing or
underwritten. Seafox and Mazrui have also irrevocably undertaken to vote in favour of the Resolutions.
-- The offer period for acceptances by Qualifying Shareholders under the Open Offer will commence on 10 June 2021
and end on 24 June 2021.
-- The net proceeds of the Capital Raising will be used to reduce the Company's indebtedness. The Board believes
that the terms of the Revised Debt Terms create a positive platform on which the future development and growth of
the business can be based.
-- The New Ordinary Shares will, when issued, represent 65.5 per cent. of the enlarged issued ordinary share capital
of the Company.
-- The Issue Price represents a discount of approximately 51.6 per cent. to the closing middle market price of 6.2
pence per Ordinary Share on 8 June 2021, being the latest practicable date prior to the publication of this
Announcement.
-- The timing for the close of the Bookbuilding Process and the allocation of the Placing Shares will be determined
together by the Joint Bookrunners and the Company.
-- The Capital Raising is conditional upon the approval by the Company's shareholders at a General Meeting to be
held on 25 June 2021 (the "General Meeting"). The Capital Raising is conditional and dependent upon, inter alia,
all the resolutions to be proposed at the General Meeting (the "Resolutions") being passed.
-- The Placing is subject to the terms and conditions set out in appendix III ("Appendix III") to this announcement
(which forms part of this announcement, such announcement, appendix I to this announcement ("Appendix I", and
together with Appendix II, Appendix III and the other appendices to this announcement, the "Appendices") and the
Appendices, together being this "Announcement").
Details of the Placing
The Placing is subject to the terms and conditions set out in
Appendix III.
The Joint Bookrunners will commence the Bookbuilding Process,
and the book will open, immediately following the publication of
this Announcement.
The timing of the closing of the Bookbuilding Process and
allocations are at the absolute discretion of the Joint Bookrunners
and the Company. Details of the results of the Placing will be
announced as soon as practicable after the close of the
Bookbuilding Process.
The New Ordinary Shares, when issued, will be fully paid and
will rank pari passu in all respects with the other Ordinary Shares
in issue on Admission, including the right to receive all dividends
and other distributions declared, made or paid after the date of
issue. The issue of the New Ordinary Shares will represent an
increase of approximately 90.0 per cent. of the existing issued
ordinary share capital of the Company.
Admission, settlement and CREST
Applications will be made to: (i) the Financial Conduct
Authority (the "FCA") for admission of the existing ordinary share
capital of the Company following the Reorganisation and the New
Ordinary Shares arising from the Capital Raising to the premium
listing segment of the Official List and (ii) London Stock Exchange
plc (the "London Stock Exchange") for admission of the New Ordinary
Shares to trading on its main market for listed securities
(together, "Admission").
The ISIN for the Ordinary Shares from Admission will be
GB00BJVWTM27 and the ticker will remain unchanged as GMS.
Settlement for the New Ordinary Shares and Admission are
expected to take place on 8.00 a.m. on 28 June 2021. The Capital
Raising is conditional upon, among other things, the Resolutions
being duly passed by the shareholders of the Company at the General
Meeting, upon Admission becoming effective and the placing
agreement between the Company and Panmure Gordon (the "Placing
Agreement") and the engagement letter between the Company and ENBD
(the "ENBD Engagement Letter") not being terminated in accordance
with their respective terms. Following Admission, the Company will
have 1,016,414,582 Ordinary Shares in issue.
A combined circular and prospectus (the "Prospectus")
containing, amongst other things, the full details of the Capital
Raising and the notice of the General Meeting is expected to be
published and posted by the Company later today. Set out below in
Appendix I and Appendix II is some further information regarding
the Company and the Capital Raising which will be contained within
the Prospectus.
Appendix III sets out further information relating to the
Bookbuilding Process and the terms and conditions of the Placing.
Persons who have chosen to participate in the Placing, by making an
oral, electronic or written offer to acquire New Ordinary Shares,
will be deemed to have read and understood this Announcement in its
entirety (including the Appendices) and to be making such offer on
the terms and subject to the conditions herein, and to be providing
the representations, warranties, agreements, acknowledgements and
undertakings contained in Appendix III.
Capitalised terms used but not otherwise defined in the text of
this Announcement are defined in appendix IV to this Announcement.
Certain key risk factors relating to the Company are set out in
appendix V to this Announcement.
The person responsible for arranging the release of this
Announcement on behalf of the Company is Mansour Al Alami,
Executive Chairman of the Company.
Commenting, Mansour Al Alami, Executive Chairman of GMS,
said:
"The fundraise announced today represents a further stepping
stone in the resetting of the GMS story. It is encouraging to have
the support and commitment from key shareholders in being able to
deliver on this. With reduced debt and much improved terms, the
Company will be well placed to benefit from the improving market
cycle in oil & gas in the Middle East and renewables in Europe
and the potential for increases in day rates as the market
continues to tighten. This will build on the significant progress
made to-date, which includes a much-reduced costs base, a
strengthening of the order book and far better levels of vessel
utilisation. These achievements are reflected in the performance of
the Company in 2021, with trading and operations in-line with the
business plan".
Enquiries:
Gulf Marine Services plc +44 (0)20 7603 1515
Mansour Al Alami (Executive Chairman)
Panmure Gordon (UK) Limited - Sponsor and
Joint Bookrunner +44 (0)20 7886 2500
Dominic Morley
John Prior
Nicholas Harland
Hugh Rich
ENBD Capital - Regional Joint Bookrunner +9714 303 2800
Prasad Chari
Celicourt Communications - public relations
adviser +44 (0)20 8434 2754
Mark Antelme
Philip Dennis
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.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
2021
Record Date for Open Offer 7 June
Announcement of the Capital Raising(1)(2)(3) 9 June
Publication and posting of the Prospectus (including 9 June
the Notice of the General Meeting), the Form
of Proxy and the Application Forms (to Qualifying
Non-CREST Shareholders only)
Ex-Entitlement Date for the Open Offer 9 June
Open Offer Entitlements and Excess Open Offer 10 June
Entitlements enabled in CREST and credited to
stock accounts of Qualifying CREST Shareholders
in CREST
Recommended latest time for requesting withdrawal 18 June
of Open Offer Entitlements and Excess Open Offer
Entitlements from CREST(4)
Latest time and date for depositing Open Offer 21 June
Entitlements and Excess Open Offer Entitlements
into CREST(5)
Latest time and date for splitting of Application 22 June
Forms (to satisfy bona fide market claims only)
Latest time and date for electronic proxy appointments 11.00 a.m. on
or receipt of Forms of Proxy 23 June
Latest time and date for receipt of completed 11.00 a.m. on
Application Forms and payment in full under 24 June
the Open Offer or settlement of relevant CREST
instructions (as appropriate)
General Meeting 25 June
Capital Reorganisation Record Date 25 June
Announcement of the Results of General Meeting 25 June
and Capital Raising
Admission of, and dealings commence in, the 28 June
New Ordinary Shares
CREST members' accounts credited in respect 28 June
of New Ordinary Shares in uncertificated form
Expected despatch of definitive share certificates By 9 July
for New Ordinary Shares in certificated form
Notes:
(1) The times and dates set out in this expected timetable and
mentioned in this Announcement the Application Form and in any
other document issued in connection with the Capital Raising are
subject to change by the Company with the agreement of, in certain
instances, Panmure Gordon, in which event details of the new times
and dates will be notified to the FCA, the London Stock Exchange
and, where appropriate, to Shareholders.
(2) References to times in this Announcement are to London time unless otherwise indicated.
(3) The ability to participate in the Placing and Open Offer is
subject to certain restrictions relating to Shareholders with
registered addresses outside the United Kingdom
(4) If your Open Offer Entitlements and Excess Open Offer
Entitlements are in CREST and you wish to convert them to
certificated form.
(5) If your Open Offer Entitlements and Excess Open Offer
Entitlements are represented by an Application Form and you wish to
convert them to uncertificated form.
IMPORTANT NOTICES
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT (INCLUDING THE APPICES) 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(e) OF REGULATION (EU)
2017/1129 (THE "EU PROSPECTUS REGULATION"); (2) IF IN THE UNITED
KINGDOM, QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(e) OF
REGULATION (EU) 2017/1129 AS IT FORMS PART OF THE UNITED KINGDOM
DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018
(THE "UK PROSPECTUS REGULATION"); 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;
AND (3) OTHERWISE, PERSONS TO WHOM IT IS OTHERWISE LAWFUL TO
COMMUNICATE IT TO (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 THE COMPANY.
THE NEW ORDINARY 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 (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE
UNITED STATES AND THE DISTRICT OF COLUMBIA) (THE "UNITED STATES" OR
THE "US") 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 NEW ORDINARY 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 NEW
ORDINARY SHARES IS BEING MADE IN THE UNITED STATES OR
ELSEWHERE.
UAE EXEMPT OFFER NOTICE
This announcement has not been reviewed or approved by any
regulatory authority, including the Central Bank of the United Arab
Emirates (the "UAE"), Emirates Securities and Commodities Authority
or any regulatory authority in any free zones established and
operating in the territory of the UAE.
The announcement does not constitute, and is not intended to
constitute, a public offer of securities in the UAE or any free
zones established and operating in the territory of the UAE and
accordingly should not be construed as such. Any securities in any
offering referred to in this announcement are only being offered to
a limited number of qualified investors in the UAE who are willing
and able to conduct an independent investigation of the risks
involved in an investment in such securities. This announcement is
for the use of the named addressee only and should not be given or
shown to any other person (other than employees, agents or
consultants in connection with the addressee's consideration
thereof).
ADGM EXEMPT OFFER NOTICE
This announcement is for distribution only to persons who (a)
are outside the Abu Dhabi Global Market, or (b) are Authorised
Persons or Recognised Bodies (as such terms are defined in the ADGM
Financial Services and Markets Regulations 2015 (" FSMR" )), or (c)
are persons to whom an invitation or inducement to engage in
investment activity (within the meaning of section 18 of the FSMR)
in connection with the issue or sale of any securities may
otherwise lawfully be communicated or caused to be communicated
(all such persons together being referred to as "relevant persons"
for the purposes of this paragraph). This announcement is directed
only at relevant persons and must not be acted on or relied on by
persons who are not relevant persons. Any investment or investment
activity to which this announcement relates is available only to
relevant persons and will be engaged in only with relevant
persons.
This announcement relates to an Exempt Offer in accordance with
the Market Rules of the ADGM Financial Services Regulatory
Authority (" FSRA" ). This announcement is intended for
distribution only to persons of a type specified in the Market
Rules of the ADGM. It must not be delivered to, or relied on by,
any other person. The FSRA has no responsibility for reviewing or
verifying any prospectus or other documents in connection with this
Offering. The FSRA has not approved this announcement or any other
associated documents nor taken steps to verify the information set
out in this announcement, and has no responsibility for it nor any
offering memorandum. The securities to which this announcement
relates may be illiquid and/or subject to restrictions on their
resale. Prospective purchasers of the securities offered should
conduct their own due diligence on the securities. If you do not
understand the contents of this announcement you should consult an
authorized financial advisor.
DIFC EXEMPT OFFER NOTICE
This announcement is for distribution only to persons who (a)
are outside the Dubai International Financial Centre, or (b) are
persons who meet the Professional Client criteria set out in Rule
2.3.4 of the DFSA Conduct of Business Module (all such persons
together being referred to as " relevant persons" for the purposes
of this paragraph). This announcement is directed only at relevant
persons and must not be acted on or relied on by persons who are
not relevant persons. Any investment or investment activity to
which this announcement relates is available only to relevant
persons and will be engaged in only with relevant persons.
This announcement is intended to provide information about
investments and investment services which are not subject to any
form of regulation or approval by the Dubai Financial Services
Authority (" DFSA "). This announcement relates to an Exempt Offer
of securities in accordance with the Offered Securities Rules of
the DIFC Financial Services Authority (" DFSA" ). This announcement
is intended for distribution only to persons of a type specified in
the Offered Securities Rules of the DFSA. It must not be delivered
to, or relied on by, any other person. The DFSA has no
responsibility for reviewing or verifying any prospectus or other
documents in connection with this CAPITAL RAISING. Accordingly, the
DFSA has not approved this announcement or any other associated
documents nor taken steps to verify the information set out in this
announcement, and has no responsibility for it nor any offering
memorandum. The securities to which this announcement relates may
be illiquid and/or subject to restrictions on their resale.
Prospective purchasers of the securities offered should conduct
their own due diligence on the securities. If you do not understand
the contents of this announcement you should consult an authorized
financial advisor.
NOTICE TO INVESTORS IN THE KINGDOM OF SAUDI ARABIA
This announcement may not be distributed in the Kingdom of Saudi
Arabia ("Saudi Arabia" or the "KSA"), except to such persons as are
permitted under the Rules on the Offer of Securities and Continuing
Obligations (the "Saudi Regulations") issued by the Board of the
Capital Market Authority (the "Capital Market Authority") pursuant
to resolution number 3-123-2017, dated 27 December 2017, based on
the Capital Market Law issued by Royal Decree No. M/30 dated
2/6/1424H (as amended by Resolution of the Board of the Capital
Market Authority number 1-104-2019 dated 30 September 2019G (the
"2019 Saudi Regulations"), and Resolution of the Board of the
Capital Market Authority number 1-7-2021 dated 14 January 2021G
(the "2021 Saudi Regulations"), noting that certain provisions of
the 2021 Saudi Regulations only come into force on 1 January
2022G).
The Capital Market Authority does not make any representation as
to the accuracy or completeness of this announcement, and expressly
disclaims any liability whatsoever for any loss arising from, or
incurred in reliance upon, any part of this announcement.
Prospective purchasers of the securities offered hereby should
conduct their own due diligence on the accuracy of the information
relating to the securities. If a prospective purchaser does not
understand the contents of this announcement, he or she should
consult an authorised financial adviser.
The New Ordinary Shares and the Open Offer Entitlements must not
be advertised, offered or sold and no memorandum, information
circular, brochure or any similar document has or will be
distributed, directly or indirectly, to any person in Saudi Arabia
other than to Sophisticated Investors within the meaning of Article
9 of the 2019 Saudi Regulations.
The Capital Raising in Saudi Arabia shall not, therefore,
constitute a "public offer" pursuant to the Saudi Regulations.
Prospective investors are informed that Article 15 of the 2019
Saudi Regulations (and Article 14 of the 2021 Saudi Regulations)
places restrictions on secondary market activity with respect to
the Shares. Any resale or other transfer, or attempted resale or
other transfer, made other than in compliance with the Saudi
Regulations shall not be recognised.
THIS ANNOUNCEMENT (INCLUDING THE APPICES) 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.
THIS ANNOUNCEMENT IS NOT FOR PUBLICATION OR DISTRIBUTION,
DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES OF
AMERICA. THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE
OR SUBSCRIPTION INTO THE UNITED STATES. THE SECURITIES REFERRED TO
HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES,
EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION. NO
PUBLIC OFFERING IS BEING MADE IN THE UNITED STATES.
The distribution of this Announcement and/or the Capital Raising
and/or the issue of the New Ordinary 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, consultants, partners or
employees ("Representatives") that would permit an offer of the New
Ordinary Shares or possession or distribution of this Announcement
or any other offering or publicity material relating to such New
Ordinary 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, 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 New Ordinary Shares is being made in any such
jurisdiction.
The New Ordinary 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 Capital Raising 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 from the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the New Ordinary Shares; and the New
Ordinary 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 the United States, Australia, Canada, the
Republic of South Africa or Japan. Accordingly, the New Ordinary
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 the United States, 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 such action.
By participating in the Bookbuilding Process and the Placing,
each person who is invited to and who chooses to participate in the
Placing (a "Placee") by making an oral, electronic or written 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 Appendix III. Members of the public are
not eligible to take part in the Placing and no public offering of
the Placing Shares is being or will be made.
This Announcement may contain, or may be deemed to contain,
"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.
Panmure Gordon 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 Capital Raising, and Panmure Gordon
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 Capital Raising
or any other matters referred to in this Announcement.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by the Joint Bookrunners or by any of their
Representatives 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.
This Announcement does not constitute a recommendation
concerning any investor's options with respect to the Capital
Raising. 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 New Ordinary Shares to be issued pursuant to the Capital
Raising will not be admitted to trading on any stock exchange other
than the main market for listed securities of 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.
Information to Distributors
Solely for the purposes of the product governance requirements
contained within Chapter 3 of the FCA Handbook Production
Intervention and Product Governance Sourcebook (the "UK Product
Governance Requirements"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any
"manufacturer" (for the purposes of the UK Product Governance
Requirements) may otherwise have with respect thereto, the New
Ordinary Shares have been subject to a product approval process,
which has determined that such securities are: (i) compatible with
an end target market of investors who meet the criteria of retail
investors and investors who meet the criteria of professional
clients and eligible counterparties, each as defined in paragraph 3
of the FCA Handbook Conduct of Business Sourcebook; and (ii)
eligible for distribution through all distribution channels (the
"Target Market Assessment"). Notwithstanding the Target Market
Assessment, distributors (for the purposes of UK Product Governance
Requirements) should note that: (a) the price of the New Ordinary
Shares may decline and investors could lose all or part of their
investment; (b) the New Ordinary Shares offer no guaranteed income
and no capital protection; and (c) an investment in the New
Ordinary Shares is compatible only with investors who do not need a
guaranteed income or capital protection, who (either alone or in
conjunction with an appropriate financial or other adviser) are
capable of evaluating the merits and risks of such an investment
and who have sufficient resources to be able to bear any losses
that may result therefrom. The Target Market Assessment is without
prejudice to the requirements of any contractual, legal or
regulatory selling restrictions in relation to the Placing.
Furthermore, it is noted that, notwithstanding the Target Market
Assessment, Panmure Gordon 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 Chapter 9A or 10A respectively of the FCA
Handbook Conduct of Business Sourcebook; 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 New Ordinary
Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the New Ordinary Shares and
determining appropriate distribution channels.
APPIX I - FURTHER INFORMATION REGARDING THE COMPANY AND THE
CAPITAL RAISING
Introduction
In November 2020, a new Board was appointed, and Mansour Al
Alami assumed the role of Interim Executive Chairman of the
Company, this role being made permanent on 26 May 2021. A key focus
since the new Board was appointed has been the renegotiation of the
terms of the Company's debt facilities. The Executive Chairman is
delighted to say that the Company successfully concluded
negotiations with its lenders on 31 March 2021 (the "Revised Debt
Terms"), on an improved structure, which is expected to see a
substantial reduction in the cost of the facilities over the next
two years, when compared to the arrangements approved by the
previous board.
As well as greatly reducing the cost of borrowings, the Company
has been granted an extension to the requirement to raise a minimum
of U.S.$25 million (net) of new equity to 30 June 2021 and until
the end of 2022 for new equity up to an aggregate total of U.S.$75
million (net) (including the amount raised previously). The equity
proceeds from this first fundraise (U.S.$25 million net) will be
used to reduce the Company's indebtedness as required under the
terms of the new debt facilities and subject to raising U.S.$25
million (net of expenses), the Company will no longer be required
to issue the First Tranche Warrants to its lenders on 1 July 2021
or be charged PIK interest on the loan facilities. Following the
Capital Raising, the Company will have a U.S.$357.5 million term
loan until 30 June 2025 and U.S.$50 million working capital
facility until 30 June 2025.
Under the revised agreement, the rate of interest payable by the
Company on its borrowings decreases from LIBOR +5 per cent. to
LIBOR +3 per cent., retrospectively from the beginning of 2021,
with the savings on interest payments being used to pay down our
principal debt position, thereby increasing the speed at which the
Company can deleverage the balance sheet. This reduced interest
rate applies until the end of 2022, after which the existing
ratchet will apply. In addition, further time has been granted to
the Company to raise equity and (if required) issue warrants as
required by the previous banking agreements.
Following Admission and the making of the prepayment of at least
U.S.$25 million referred to above, the previously announced PIK
structure will automatically cease to apply. If the second
equity-raising and prepayment is achieved by the end of 2022, PIK
interest will never accrue.
The net proceeds of the Capital Raising will be applied to
reduce indebtedness under the Revised Debt Terms, to satisfy the
First Equity Raise Condition.
Background to and reasons for the Capital Raising
Under the management of the previous board of directors, none of
whom are now serving, the Company announced on 10 June 2020 that it
had reached agreement with its syndicate of banks on heads of terms
for the restructuring of its debt facilities. The agreement
provided for renewed existing term loan facilities with an extended
maturity to 30 June 2025, a new working capital facility to replace
the existing working capital facilities, increased financial
covenant headroom, the issue to the lending banks of warrants to
subscribe for new Ordinary Shares which, if fully vested and
exercised in full before their expiry in June 2025, could result in
the banks owning up to a 20 per cent. minority interest in the
outstanding shares of the Company and the payment of additional
interest on a PIK basis.
It was agreed that the warrants would not be issued and
additional PIK interest would not be chargeable if the Company
completed an equity fund raising of at least U.S.$75 million (net)
and made a prepayment of U.S.$75 million in respect of the debt
outstanding under the agreements, in each case no later than 31
December 2020. It was also agreed that if the U.S.$75 million
prepayment referred to above was not made and the Shareholder
resolutions necessary to authorise the issuance of the warrants
were not passed, in each case by 31 December 2020, the banks would
be entitled to call a default under the agreements.
To allow this process time to conclude, the banks granted the
Company relief under its existing bank facilities in the form of
(i) the rollover of certain loans, (ii) the waiver of applicable
financial covenant tests and (iii) the deferral of the principal
payments due thereunder. At the same time, the Company made initial
progress towards undertaking a share capital increase before the
end of 2020, with the aim of raising at least U.S.$75 million of
net proceeds.
Soon thereafter, Seafox announced that it had made a non-binding
proposal to the Board regarding a possible cash offer for the
entire issued and to be issued share capital of the Company. Seafox
highlighted at the time that if the Company should be unable to
secure sufficient equity investment and if the warrants were issued
and/or PIK interest is incurred, this would severely depress
returns for the Company's shareholders. On 28 May 2020 Seafox
announced that it did not intend to make an offer for the Company
pursuant to Rule 2.7 of the City Code on Takeovers and Mergers.
Over the next few months, the Company received requisitions from
Seafox requiring that general meetings be convened to consider the
resolutions to appoint additional directors to the Board and to
remove other directors given, inter alia, Seafox did not believe
the proposed bank deal was in the best interests of Shareholders.
These resolutions were passed. At the same time, the Company
prepared a circular to Shareholders to seek approval for the issue
of the warrants referred to above. These resolutions were not
passed.
On 31 December 2020, the Company announced that the banks had
agreed to extend, until 31 January 2021, the obligations on the
Company which it was otherwise required to have met by 31 December
2020, including in relation to the issue of warrants to the banks.
The Company thereby avoided an event of default at the time. This
extension was further extended and a new definitive agreement was
announced with the Lenders on 1 April 2021.
The Board considers that the terms of the Revised Debt Terms are
significantly better than those originally negotiated by the
previous board members and represent a material uplift to the
equity value attributable to Shareholders.
Key terms of the Revised Debt Terms
Under the Revised Debt Terms, the rate of interest payable by
the Company on its term borrowings will decrease from LIBOR +5 per
cent. to LIBOR +3 per cent., retrospectively from the beginning of
2021. The reduced interest rate will apply until the end of 2022.
The same applies to the working capital loans, except the original
margin on those loans was 4.75 per cent.
Additional time has been granted to the Company to raise equity.
The previous PIK structure and deadlines for the issuance of
warrants to the banks no longer apply; instead, providing the
Company satisfies the First Equity Raise Condition and makes the
Interim Prepayment no later than 30 June 2021, and satisfies the
Second Equity Raise Condition to make the Minimum Prepayment no
later than 31 December 2022, it will not be required to issue any
Warrants nor will any PIK interest accrue. Any such proceeds raised
will be used to reduce the Company's debt liabilities.
Details of the key terms of the Revised Debt Terms are as
follows:
-- the cash interest margin is reduced from LIBOR +5 per cent.
(+4.75 per cent. in the case of working capital loans) to LIBOR
+2.75 per cent., retrospectively from the beginning of 2021. This
reduced interest rate applies until the end of 2022, after which
the existing ratchet will apply;
-- faster deleveraging of the balance sheet through the
application towards principal repayment of the cash saved due to
the reduced margin; and
-- the granting of longer periods to raise a minimum net amount
of U.S.$75 million (to be applied towards prepayment of the loans)
before triggering the issuance of warrants and accrual of PIK.
The Board believes that the terms of the Revised Debt Terms are
on vastly improved terms to what was agreed in June last year. As a
result, this creates a positive platform on which the future
development and growth of the business can be based, allowing the
Company to benefit from pick-up across its core markets.
Further, the revised structure provides the time needed to seek
to complete the U.S.$75m equity raise, as well as review
alternative options to optimise the capital structure, including a
refinancing, by the end of 2022, should the Company be able to
deleverage the balance sheet and improve its net debt to Adjusted
EBITDA profile.
Operational improvements
A number of operational improvements with a particular focus on
areas that improved the financial performance of the Company have
been put in place recently. These include:
-- A cost reduction programme that has resulted in more than US
$20 million of annualised cost savings being removed from the
business since it commenced in 2019, with key areas of saving in
the following areas:
-- Streamlining of organisational structure with the removal of
excessive layers of management and support personnel;
-- Renegotiation of key supplier contracts to reduce cost and lock in pricing going forward;
-- Review of build-up of crew onboard vessels with the removal
of unnecessary or redundant positions;
-- Closure of our operational office in Aberdeen, Scotland with
operations now being run from our headquarters in Abu Dhabi, United
Arab Emirates; and
-- Closure of our yard facilities in Mussafah and MINA Port, Abu
Dhabi and relocation of our headquarters to a smaller office.
-- Relocation of two E Class vessels from the North Sea to MENA
Region to capitalise on higher levels of current and future demand
in our core markets within the MENA Region (UAE, Saudi Arabia and
Qatar).
-- A temporary increase to crew rotations (the time a seafarer
spends on board our vessel before going on leave) in order to
overcome challenges presented as a direct result of the COVID-19
Pandemic where the rotating of crew offshore has been impacted as a
result of border closures and quarantine requirements.
The Company continues to explore further opportunities to bring
in more efficiencies to the business whilst ensuring that the
continued delivery of safe and reliable operations are not
compromised.
Management and board changes
On 10 November 2020, Rashed Al Jarwan Saeed Abdullah Khoory and
Mansour Al Alami were appointed to the Board as Non- Executive
Directors by resolutions passed by shareholders. The Board that day
appointed Mansour Al Alami as Non-Executive Chairman and later that
month as Interim Executive Chairman, made permanent on 26 May 2021.
Sadly, Saeed Abdullah Khoory passed away in February this year. On
25 November, Hassan Heikal was appointed to the Board by a
resolution passed by shareholders and was subsequently appointed as
Deputy Chairman in February 2021. Also in February this year, Jyrki
Koskelo was appointed by the Board as an additional Independent
Non--Executive Director. GMS are also delighted to have appointed
Lord St John of Bletso as Independent Non--Executive Director on 26
May 2021. The Company is currently searching for an additional
Independent Non-Executive Director with the right skill sets to
strengthen the board further and add greater diversity.
Earlier this year the Company also appointed both a Chief
Financial Officer, Andy Robertson, and a Chief Operating Officer,
Mark Harvey. Both individuals have been with the Company for
several years and bring extensive industry knowledge and
experience.
The new Board combines strong relationships with key clients and
banks, in the MENA region, with a high level of industry knowledge.
These strengths have already benefited the business, through the
delivery of improved banking terms, and the Board believes they
will also play a key role in helping the future direction and
growth of the business.
Management and board changes
The Company is committed to, and recognises the value and
importance of, high standards of corporate governance. As at the
date of the Prospectus, the Company is in compliance with the
provisions set out in the UK Corporate Governance Code, with the
exceptions of provisions 9 and 20 as described in the table below
and on page 42 of the Company's Annual Report and Accounts for
2020.
The table below shows the provisions of the Corporate Governance
Code with which the Company was not in compliance during the
periods specified below.
UK Corporate Governance Period of Reasons for non-compliance
Code Provision non- compliance
5. A designated From 10 November Transition period following complete
Director for 2020 to 6 Board change and selection of
engagement May 2021 an appropriate Director to fulfil
with the workforce. this role.
9. The roles of From 21 August Whilst holding the positions of
Chair and Chief 2019 both Executive Chairman and Chief
Executive should Executive is not recommended by
not be exercised the UK Corporate Governance Code,
by the same the Board has concluded that this
individual. continues to be appropriate for
the Company.
This recognises both the level
and pace of change necessary for
the Company and its relatively
small scale. The Board also believes
that Mr. Al Alami is the best
person to chair the Board and
lead the management of the business
for the foreseeable future, but
will continue to keep these arrangements
under review to ensure that they
operate satisfactorily.
20. Open advertising Following Mansour Al Alami, Rashed Al Jarwan,
and/or an external outcome of the late Saeed Mer Abdulla Khoory
search consultancy General Meeting were appointed Non-Executive Directors
should generally of 10 November following majority shareholder
be used for 2020 votes cast at the requisitioned
the appointment General Meeting of 10 November.
of the chair Hassan Heikal was similarly appointed
and non- executive on 25 November. Given extensive
directors. contacts already available, the
scale of the Company, the need
to minimise expense, the appointment
of Jyrki Koskelo and Lord St John
of Bletso by the Board followed
a search process though not through
open advertising or an external
search consultancy.
21. There should 2020 evaluation The 2019 evaluation was completed
be a formal review in 2020. Following the changes
and rigorous to the Board in November 2020,
annual evaluation the new Board intends to undertake
of the performance the next evaluation during 2021
of the Board, to allow meaningful assessment
its Committee, of the new Board to be made.
the Chair and
individual
Directors.
24. The Board should From 10 November Transition period following the
satisfy itself 2020 to 4 Board change and the procedure
that at least February required for the appointment of
one member 2021 Jyrki Koskelo, who has recent
has recent and relevant financial experience.
and relevant
financial experience.
Current trading and prospects in respect of the Group
The Board is confident that utilisation and revenues in 2021 and
beyond will continue to grow, despite the challenges the Company
continues to face as a result of the COVID-19 pandemic. GMS'
confidence is based on the contracted backlog which, including
options, stood at U.S.$199 million as at 6 May 2021, combined with
an improved pipeline of opportunities, underpinned by the better
financial structure now in place. The improved pipeline is aided by
an uptick for demand for our services in our core markets, driven
by an increase in activity by our key NOC and EPC customers as well
as a pick up in offshore wind, where seven of our fleet can be
deployed. The Company has also benefited from a decrease in vessel
supply in our Middle Eastern markets, due to demand for vessels to
service the growing offshore windfarm market, particularly in
China.
These market dynamics also make us optimistic that the day rates
for our fleet will improve in the short term.
Procedures are now in place to minimise COVID-19 related costs,
while tenders, due to be announced in 2020, are likely to be
awarded in 2021, as demand from the Company's key clients remains
strong.
GMS began 2021 with a significant improvement to the secured
utilisation position, over last year, which is encouraging and
gives the Company added comfort for the year ahead. For example, on
14 April 2021 GMS announced two additional short-term contract wins
for our larger E-Class vessels, with an EPC client in the MENA
region and a Windfarm Developer in North West Europe. It is equally
encouraging to have a number of contracts extended, demonstrating
the strength of the relationships GMS has with its clients and
their willingness to work with the Company going forward.
The Group's financial performance, to the end of March 2021,
remains in line with business plan and an improvement from the same
period last year. With over 91 per cent. of the 2021 business plan
revenues already secured, 80 per cent. vessel utilisation already
secured for 2021, together with an improvement on day rates on
recent contract awards for the Group's larger E-Class vessels, the
Board is confident of delivering further improved results.
Free float and shares in public hands
Following the acquisition of Ordinary Shares by Seafox in 2020,
the percentage of the Company's share capital in public hands has
dropped below the level ordinarily required under the Listing
Rules. As at the Latest Practicable Date shares in public hands are
currently calculated to be approximately 21.9 per cent., 3.1
percentage points below the level ordinarily required under the
Listing Rules. A temporary modification has been granted by the FCA
until 5 November 2021 to allow for the total number of shares in
public hands to fall below the required threshold to a minimum of
21.9 per cent.
Should the number of Ordinary Shares held by the Company's major
Shareholders increase further in due course, this will reduce the
percentage of shares in public hands again, and perhaps below the
level required. In such circumstances, the Company would seek a
derogation from the FCA under the Listing Rules so the Company has
time to seek to rectify the position again. No guarantees can be
provided that the FCA would approve such a derogation request or on
the conditions that may be imposed.
Details of the Open Offer
Subject to the terms and conditions to be set out in the
Prospectus (and, in the case of Qualifying Non-CREST Shareholders,
the Application Form), the Open Offer Shares will be offered for
subscription to Qualifying Shareholders on the following basis: 19
Open Offer Shares at 3 pence per Open Offer Share for every 10
Existing Ordinary Shares held and registered in their name at the
Record Date and so in proportion for any other numbers of Existing
Ordinary Shares then held.
Qualifying Shareholders may apply for any whole number of Open
Offer Shares up to their Open Offer Entitlements. Fractions of Open
Offer Shares will not be allotted and each Qualifying Shareholder's
Open Offer Entitlements will be rounded down to the nearest whole
number. Any fractional entitlements to Open Offer Shares will be
disregarded in calculating Qualifying Shareholders' Open Offer
Entitlements and will be aggregated and made available under the
Excess Application Facility. Applications by Qualifying
Shareholders will be satisfied in full up to their Open Offer
Entitlements.
Qualifying Shareholders may apply to subscribe for additional
Open Offer Shares using the Excess Application Facility, should
they wish.
The Excess Application Facility will comprise Open Offer Shares
that are not taken up by Qualifying Shareholders under the Open
Offer pursuant to their Open Offer Entitlements. Qualifying
Shareholders' applications for additional Open Offer Shares will,
therefore, be satisfied only to the extent that any fractional
entitlements are aggregated and to the extent that applications by
other Qualifying Shareholders are made for less than their pro rata
Open Offer Entitlements.
If there is an over-subscription resulting from excess
applications, excess applications shall be allocated on a pro rata
basis to Qualifying Shareholders' excess applications.
Any Open Offer Shares which are not applied for under the Open
Offer or the Excess Application Facility will be allocated to
Placees at the Issue Price.
APPIX II - BUSINESS OVERVIEW OF THE GROUP
The Group is a leading provider of advanced SESVs, serving the
offshore oil, gas and renewable energy sectors, with a focus on the
MENA region and Northwest Europe. The Group's fleet of 13 SESVs is
highly attractive to customers seeking to charter some of the most
advanced, reliable and cost-efficient vessels to provide a wide
range of services throughout the life-cycle of offshore oil, gas
and renewable energy projects. The Group charters its SESVs to a
high-quality customer base comprising NOCs, NIOCs, EPC contractors,
OEMs and renewable energy companies operating in the MENA region
and Europe.
The Group's fleet currently comprises three classes of vessels
that serve a range of customers' needs. There are four E-Class
vessels with an average age of eight years, three S-Class vehicles
with an average age of five years and six K-Class vessels with an
average age of 14 years.
The Group's SESV fleet supports its customers in a broad range
of offshore oil and gas platform refurbishment and maintenance
activities, well intervention work and offshore wind farm
maintenance work. These activities are typically funded out of the
operating budgets of the Group's customers. The Group's SESV fleet
also supports its customers in respect of offshore oil and gas
platform installation, modifications and decommissioning and
offshore wind turbine installation. These activities are typically
funded out of the capital expenditure budgets of the Group's
customers.
The Group's revenue is generated by the day rates for each
vessel that it charges pursuant to its charter contracts. For the
year ended 31 December 2020, the Group had an average utilisation
rate of 81 per cent., revenues of U.S.$102.5 million, Adjusted
EBITDA of U.S.$50.4 million (increasing to U.S.$59.5 million when
adding back heavy lift and COVID-19 costs) and an Adjusted EBITDA
margin of 49 per cent. (increasing to 58 per cent. when adding back
heavy lift and COVID-19 costs).
1.1 Strengths and Strategy
The Group's Competitive Strengths
The Group believes that it is well positioned to execute and
achieve its strategies based on a number of competitive
strengths.
(a) The Group has a technologically advanced modern flexible fleet
The Group's fleet of 13 technologically advanced SESVs is one of
the most modern and sophisticated in the industry with average life
expectancy of up to 40 years and with an average age of ten years,
compared to an industry average of nearly 17 years in the MENA
region and just over 10 years in Northwest Europe. The Group
believes this is especially helpful in the tendering process as
historically, in a market characterised by low utilisation rates
across the industry, its customers are demonstrating a preference,
and in some cases a requirement, for modern vessels that provide
significant cost and operational efficiencies.
The Group's SESVs operate in a broader range of environmental
conditions than older, lower specification SESVs or alternative
vessels. The Group's SESVs have large deck space, high
specification cranes, sophisticated jacking mechanisms to reduce
the time taken to be in position and are equipped with facilities
that accommodate 150 POB and can be further supplemented with
offshore temporary accommodation models, supporting up to a total
of 300 POB. The Group believes that through the combination of its
modern technologically advanced fleet and its experienced and
skilled crew and employees, its able to provide its customers safe
and effective mobile offshore platforms. The Group believes this
combination also allows it to advance its position as the preferred
provider of SESVs for oil and gas customers performing well
intervention services, topside maintenance and EOR.
The Group believes the technological capabilities of its SESVs
also deliver greater operational efficiencies than alternative
vessels, leading to significant time and cost savings for its
customers from reduced fuel usage, the elimination of ancillary
vessel hire for non-propelled vessels and reduced non-productive
time. These cost benefits make the Group's SESVs attractive for its
customers.
The Group continues to be at the forefront of technological
innovation in SESVs and use the its extensive management knowledge
and industry experience to expand its services to provide flexible,
cost-effective, support solutions to its customers. Bespoke support
solutions include the first cantilever system for a SESV and an
innovative crew transfer tower that allows personnel transfers
while the Group's SESV is jacked up. GMS Evolution, one of the
Group's E-Class vessels which is fitted with the unique GMS
cantilever, secured its first contract trialling this technology in
2020 for a NOC in the MENA region and was subsequently awarded a
long- term contract from the same client that commenced in January
2021.
(b) A highly experienced international management team
implementing an ambitious turnaround programme
Over the last two years, the entirety of the Board, with the
exception of one of the senior management team, has been replaced.
In that time period the Group has implemented an ambitious
turnaround programme that has reduced costs, with more than U.S.$20
million of annualised savings implemented to date and improved
fleet utilisation to levels not seen since 2016. The management
team is committed to further strengthening the business to deliver
shareholder value.
(c) Revenue visibility from a substantial contract backlog with
high-quality, long-term customers
The Group maintains strong, well-established relationships with
blue-chip customers, including NOCs, IOCs, EPC contractors and
OEMs, in the MENA region and Northwest Europe. These contracts
typically last six months to three plus years, depending on the
activities and include option periods that have historically been
extended. During 2020, the Company was awarded seven new contracts,
with a combined charter period of 7 years (including contract
extensions). The Group's secured backlog, including options, as at
31 December 2020 was U.S.$220.2 million, reflecting a 10.8 per
cent. decrease in the secured backlog as at 31 December 2019 of
U.S.$246.9 million. The Group's total backlog has an average
contract duration of approximately 551 days.
Historically, the majority of the Group's SESV activity has been
driven by well intervention and maintenance and refurbishment of
oil and gas platform top sides as platform age significantly
increases the amount of top side repair, maintenance and
refurbishment work necessary for the platform to remain serviceable
and compliant with relevant regulations. More recently, however,
the Group is seeing increased demand from its oil and gas customers
for its SESVs to support EOR programmes in mature fields, as these
customers are increasingly focussed on enhancing recovery of their
discovered reserves. These EOR programmes require extended periods
of SESV availability to man topside module installation and
modifications, work-over wells and tie back new wells. The Group
believes that it is well-positioned to benefit from this trend
because its fleet is suited to rapid, multi-move work
programmes.
(d) A strong health, safety and environment culture and track record
The Group believes that it is a leader in HSE thanks to the
commitment of the its senior management to developing, nurturing
and sustaining a culture that targets "no harm to people or the
environment". The Group's senior management provides strong
demonstrable leadership and commitments towards HSE though
participation in HSE meetings with staff and contractors, joint
management inspection visits and HSE audits. As a result of this
commitment, the Group achieved a total recordable injury rate and
lost time injury rate of zero in 2018, which rose slightly to 0.29
and 0.19, respectively, in 2019, and decreased to nil and nil,
respectively, in 2020. In absolute terms, these remain at a low
level and the Group's safety record has surpassed the industry
average since 2007.
The Group obtained and have maintained ISO accreditation (ISO
14001, 9001 and OHSAS 18001) since 2009, and several of the Group's
vessels have a UK North Sea Safety Case. In addition, in 2017, it
obtained a UK North Sea Safety Case for its innovative cantilever
system (as a mobile offshore drilling unit). Furthermore, the
Group's vessels GMS Endeavour and GMS Endurance have Dutch safety
cases. In 2020, more than two million working hours were
accumulated across its operations with no spills or unintended
releases that cause damage to the environment.
(e) The Group has a highly skilled workforce
The Group has owned and operated SESVs for more than 35 years.
The Group's multi-cultural workforce is recruited from more than 35
countries and has extensive experience in the global SESV sector.
It retains critical specialist personnel in the fields of
electrical, jacking, crane and dynamic positioning, and the Group's
managers have extensive industry experience as naval architects,
oil and gas specialists, marine engineers and master mariners. The
Group's GMS Training Academy allows it to efficiently equip its
newly recruited and experienced qualified mariners with the
additional, highly specialised skills needed to operate the Group's
SESVs. In 2017, the Group designed and developed the SESV Move and
Positioning Course, delivered via a simulator, which has been
adopted as an industry training standard and is being provided to
operators of jack-up barges through third party international
marine and offshore training providers. Further, the Group is
committed to staff retention. During 2019, the Group's staff
retention of full-time employees was 83 per cent. For the year
ended 31 December 2020, the retention rate was 92 per cent. In
addition to individual training programmes for its skilled crew
members, the Group uses a robust competence management system to
assess performance and retain its valuable employees.
During 2019 and 2020, internal communications increased both
onshore and offshore via town hall meetings, regular updates and
video communication from the executive Chairman to all offshore
staff. In December 2019, the Company launched the first employee
engagement survey.
1.2 The Group's Strategy
The Group's primary objective is to create long-term shareholder
value through the delivery of modern, innovative and sustainable
solutions to its customers in the offshore energy sector,
maximising the advantages its operational flexibilities provide. In
order to achieve this, the Group is focused on the strategic
priorities set out below.
(a) Driving Revenue
The Group uses its expertise in technological innovation to
continually enhance its fleet, offering new or improved offshore
support solutions to anticipate its customers' operational
requirements. The Group's advanced fleet capability makes it
ideally placed to capitalise on a recovering market. The Group will
continue to optimise the its fleet to ensure deployment matches
demand, allowing it to maximise fleet utilisation through best in
class operations. This strategy has proven to be effective. Vessel
utilisation for 2020 was 81 per cent., and for 2021 utilisation
secured by contract as of the date of this announcement is 80 per
cent.
(b) In Country Value
Recent focus on improving local content from, in particular, the
Group's NOC clients - preference given to contractors with the
highest ICV
-- UAE - improvement in ICV score from 36 per cent. to 61 per
cent. in the last three years. Contractors that meet the technical
requirement of the tenders and that have the highest ICV score are
given a price match opportunity against a lower bid from a company
with a lower ICV score.
-- KSA - partnered through the Group's JV with established KSA
business (Al Fouad Group). The IKTVA programme in place on all
contracts awarded by Aramco where the supplier is required to meet
pre-set levels of IKTVA score over the life of the contract -
failure to do so can result in termination of the contract and
denial of access to new tender opportunities.
-- Qatar - the Group's Qatar office opened in 2019, and recently
it has been bidding NOC work through a strategic relationship
agreement with Milaha. Contractors that meet the technical
requirement of the tenders and that have the highest ICV score are
given a price match opportunity against a lower bid from a company
with a lower ICV score.
(c) Cost management
The Group is focused on delivering safe and cost-effective
operations. The Group aims to generate continual cost efficiencies
throughout the whole business and reduce its working capital
requirements. The Group focuses on appropriately managing its costs
and working capital, with due regard to the margins required to
maximise liquidity.
During 2019, the Group embarked on a cost saving programme and
since then have made significant progress in reducing its cost
base. As at 31 December 2020, this programme had secured in excess
of U.S.$20 million in annualised savings, significantly exceeding
the original target of U.S.$6 million set in March 2019. These
savings have been achieved through the delivery of further
reductions in headcount, with a focus on eliminating senior
management positions, the closure of offices and redundant
facilities, and the reduction in costs of the supply chain through
competitive tendering and contract renegotiation. The cost savings
have allowed the Group to fund shift in strategy to maximise
utilisation without impacting overall profitability, resulting in
an Adjusted EBITDA margin (when adding back COVID costs and heavy
lift costs) of 58 per cent. in 2020, which is an improvement of 10
percentage points from 2019. Going forward, the Group expects that
its annual maintenance capex will be approximately U.S.$5 million
across its fleet.
(d) Establish and operate within an appropriate financial framework
The Group's objective is to grow Shareholder value by maximising
returns on capital, while meeting its customers' needs, which can
change over time. In order to achieve this, it is seeking to
establish an appropriate long-term sustainable capital structure,
with reduced leverage, to meet the Group's strategy of generating
long- term shareholder value. The Group will seek to achieve this
in the first instance by using the net proceeds from the Capital
Raising for debt reduction. Based on current bank facilities this
will generate savings on interest through not only reduced debt but
also lowering the cost of borrowing in 2021 and 2022, and, subject
to raising a minimum of $75 million of new equity by 31 December
2022, removing PIK interest and warrants.
(e) Attract, develop and retain a talented workforce
The Group attracts and retains talented people with the right
range of skills, expertise and potential in order to maintain an
agile and diverse workforce that can safely deliver its flexible
offshore support services. The Group provides bespoke training to
key personnel and train its staff to the highest operational
standards. The Group will continue to appropriately incentivise its
people and to encourage their personal career development and
progression within it.
(f) Business Activities
The Group owns and operate a modern, high specification fleet of
13 SESVs that provide customised, versatile, mobile, safe and
stable offshore platforms for the Group's customers to support a
broad range of activities throughout the lifecycle of shallow water
offshore oil and gas and renewable energy assets.
The following tables set out the Group's revenue by geographic
region for the three years ended 31 December 2018, 2019 and
2020.
Percentage Percentage Percentage
of Total of Total of Total
2020 (%) 2019 (%) 2018 (%)
UAE and Qatar 72.4 71.0 49.1 45.0 27.1 22.0
KSA 17.7 17.0 32.5 30.0 54.9 44.0
Northwest Europe 12.3 12.0 27.2 25.0 41.4 34.0
Total 102.5 100.0 108.8 100.0 123.4 100.0
Impact of COVID-19
The Group only had a minor impact resulting from the COVID-19
pandemic. The Group experienced less than 2 per cent. downtime as a
result of COVID-19 related incidents onboard its vessels throughout
the year, and no contracts were cancelled. The Group has seen some
deferment of tender awards and contract commencement with clients
most of which it expects to be awarded in 2021. Some operation
changes, such as crew rotation being extended, were required. The
utilisation for 2020 was the highest in the last three years,
despite the pandemic.
(g) Oil and gas
Historically, the Group operates predominantly in the brownfield
market within the offshore oil and gas sector. The brownfield
market covers a broad range of repair and maintenance support
services, including well and subsea maintenance services, for
existing oil and gas fields as well as major improvements/overhauls
of existing infrastructure. However, in recent years, the Group has
earned an increasing proportion of its revenue from greenfield
projects and other activities funded out of its customers' capital
expenditure budgets. The greenfield market includes engineering,
procurement and construction activities, installation and
decommissioning, and, with respect to EOR activities, water
injection and gas injection. The Group's vessel operations span the
full lifecycle of an offshore oil or gas field.
(h) Offshore renewable energy
The Group has 10 years of history supporting renewables in the
North Sea. The Group has fitted a landing system to Endeavour in
2018 to allow clients to deploy their work crews efficiently via
crew transfer vessel without having to jack down the vessel.
As North Sea wind farms are increasingly being located further
offshore, there is a growing requirement to accommodate the
workforce close to the work site during both the construction and
maintenance phases. The Group's SESVs are ideally suited, as they
provide a stable platform on which its clients' personnel are
accommodated and can remain on location throughout the entire
project. The Group's vessels can also move rapidly between in-field
locations, which helps to increase the efficiency of client
personnel transfers. Windfarms are so large that the SESV can
follow the work programme around minimising travel time between
accommodation and work site.
During 2018, offshore renewable energy became a growth area,
with revenue of U.S.$28.3 million in respect of installations
comprising 23 per cent. of total revenue in that year with the
trend continuing in 2019. However, due to the phasing of renewables
work, growth in this sector declined in 2020. Nevertheless, the
Directors are confident in the medium-term prospects for the
renewables market in Northwest Europe, as the next round of wind
farm developments move forward. In the meantime, given the flexible
and adaptable nature of the Group's SESV fleet, at year end 2019 it
relocated two E-Class vessels from the North Sea to the Middle
East, given the higher levels of activity in the region. The
decision to move the vessels to MENA is driven by a combination of
increased demand in the region as well as a short-term lack of
demand in Northwest Europe.
The Group's vessel operations support the full lifecycle of an
offshore renewables project.
The Group's primary focus in the offshore renewable energy
market is the provision of SESVs to support the construction of new
windfarm developments by providing accommodation on site, and to
provide lifting operations for smaller substations and topside
modules. The Group's clients are seeing the benefit of "walk to
work" and having accommodation in the area of construction
resulting in significant uptime of their construction crews. In the
case of foundation and turbine installation, vessels with
significantly larger crane capacity than the Group's E-Class and
S-Class vessels are usually required.
The Group's charter contracts in this market tend to be short
(i.e., three to 12 months) or medium (i.e., one to three years) in
term. The Group's E-Class vessels are well suited for newer
windfarm developments that are being undertaken in deeper water and
further offshore, as they provide a cost-effective method for
customers to complete a majority of the project (without having to
return to port), working together with larger, more expensive
vessels to undertake turbine and foundation installation. Costs to
the customer are reduced as the requirement to transport the
client's workforce between disparate remote locations is
minimal.
The Group believes its SESVs provide a competitive advantage
over floating accommodation vessels, as fixed platform means that a
client's personnel who generally are not seasoned seafarers benefit
from enhanced living conditions during rest periods (i.e., better
night sleep than they would get moving around the North Sea in a
boat). As in the oil and gas market, the features of the Group's
SESVs allow them to move quickly and efficiently between locations
within a wind farm field without the need for tugs. As a result,
the Group believes that it is well positioned to capitalise on the
strong outlook for new installations.
The offshore renewable energy market is less mature than the oil
and gas market and there is currently less demand for maintenance
services as the infrastructure is, overall, relatively new.
However, when a critical mass of installed capacity is reached, the
Group expects that the demand for maintenance work on these assets
will increase and, consequently, that long-term contracts will
become more commonplace. Given the Group's experience providing
long-term services to the oil and gas market with its fleet, it
believes that it will be particularly well placed to capitalise on
this maturing market profile as it develops and it intend to focus
a significant portion of its offshore renewables marketing efforts
on this area due to the long-term nature of these contracts.
1.3 The Group's Fleet
The Group currently operates a fleet of 13 high specification
SESVs comprising four E-Class vessels, three S-Class vessels and
six K-Class vessels. The following table sets out certain key
characteristics of the Group's SESVs as at 31 December 2020.
Maximum
Accom-modation Main
Year Deck Maximum Maximum (POB) Crane Harsh Dynamic
Built area depth speed (2) Capacity environment Positioning
(m2) (m) (kts) (t)
E-Class Vessels
Endurance 2010 1,035 65 8 150 300 Yes DP2
Endeavour 2010 1,035 65 8 150 300 Yes DP2
Enterprise 2013 1,035 80 8 150 400 Yes DP2
Evolution
(1) 2016 920 80 8 150 200 Yes DP2
S-Class Vessels
Shamal 2015 800 55 6 150 150 Yes DP2
Scirocco 2015 800 55 7 150 150 Yes DP2
Sharqi 2016 800 55 7 150 150 Yes DP2
K-Class Vessels
Kamikaze 1995 600 45 4 150 36 N/A N/A
Kikuyu 2005 600 45 4 150 45 N/A N/A
Kawawa 2007 600 45 4 150 45 N/A N/A
Kudeta 2008 600 45 4 150 45 N/A N/A
Keloa 2009 600 45 4 150 45 N/A N/A
Pepper 2014 800 55 4.5 150 75 N/A N/A
Notes:
(1) The Group's cantilever system is installed on Evolution.
(2) Accommodation is the number of people each vessel can hold
under normal specifications.
The Group's SESV fleet is one of the most modern operating in
the MENA region and in the world, with most of its SESVs having
been delivered or refurbished over the past eleven years and having
an expected future useful life of more than 25 years. As at 30
December 2020 an independent valuer valued the Group's fleet of
SESVs at U.S.$500.5 million. The average age of the Group's SESV
fleet is only ten years, which it believes positions it within the
top tier of operators globally. Modern, and consequently more
reliable and efficient, SESVs are in higher demand by the Group's
customers. In addition, a young and modern fleet is becoming
increasingly important as customers focus on safety and
high-performance standards. For the year ended 31 December 2020,
the average day rates for the Group's E-Class, S-Class and K-Class
vessels were U.S.$29 thousand, U.S.$32 thousand and U.S.$20
thousand, respectively. The technical specifications of the Group's
SESVs help it to achieve its utilisation rates, as in many
instances the alternatives available to its customers are non-SESV
vessels that are more expensive to operate because of the need for
additional support vessels, longer jacking time and difficulty
relocating in inclement weather, among other things. Lower day
rates have led to improved utilisation (particularly in 2020). The
Group has employed the strategy that some contribution is better
than no contribution, so it accepted lower day rates to keep the
vessels working in the short term. This was particularly the case
in 2020 where two E-Class where employed on short term contracts
that the smaller K-Class could have fulfilled had there been
availability. Although secured day rates for 2021 have remained
relatively flat on K-Class and S-Class, the Group has noticed an
increase in day rates on E-Class of over 10 per cent. over 2020
average rates on contracts awarded in 2021.
All of the Group's SESVs are based on four-leg designs that
provide a significant advantage in terms of safety and stability to
the more traditional three-leg jack-up design due to a high level
of elevated stability and their ability to be jacked up and down
quickly on location. When on location, the SESV legs are lowered
down to the seabed before elevating the SESV to the desired
operating height. The pre-load can be carried out as an integrated
process during lifting, with a four-leg design providing
significant time savings compared to three-leg operations, some of
which can take up to 18 hours to pre-load. The four-leg design also
allows more positioning flexibility and reduces seabed
punch-through risk when in operation. The flexibility of a four-leg
design also presents a significant cost advantage to the Group's
customers, as moves within or between fields require less lead time
and can be completed in windows of six to 12 hours in the event of
adverse weather conditions as compared to 24 to 36 hours for three-
leg vessels or up to three days for a non-propelled vessel. All of
the Group's SESVs are self- propelled, which enables the vessels to
carry loads from a shore base to an offshore location without the
need for tugs or support vessels either in transit or to position
the SESV in relation to an offshore installation. Consequently,
they can be mobilised to site in a significantly shorter period of
time than three-legged SESVs (typically six to 12 hours vs 36
hours). Large accommodation capacity and leg length between 69
metres and 104 metres, combined with a large deck space equipped
with crane capacity, allows for multifunctional, flexible use
serving a broad range of the Group's customers' offshore support
needs, both in terms of operating areas and modes.
All the Group's SESVs are equipped with facilities that
accommodate 150 POB and can be further supplemented with offshore
temporary accommodation modules, supporting up to a total of 300
POB if required. The Group's SESVs have many advantages over pure
accommodation barges, as they have greater flexibility to increase
or decrease capacity and are self-propelled jack-up vessels that
have low mobilisation and demobilisation costs. The Group's SESVs
also offer greater crane capacity, larger deck loads and more deck
space compared to pure accommodation barges. SESVs can either cater
to specific accommodation requirements of personnel engaged in
performing construction and maintenance or well servicing support,
or alternatively serve as pure accommodation vessels.
Average daily operating expenditure (calculated as cost of sales
less non-cash items, depreciation, amortisation and impairments
divided by number of on hire days) is U.S.$10 thousand for the
Group's E-Class vessels, U.S.$9 thousand for its S-Class vessels
and U.S.$8 thousand for its K-Class vessels.
The Group's SESVs operate continuously with a marine crew of
approximately 16 people (excluding catering staff) operating in two
shifts. Crew rotation is per customer specification or in
accordance with regional norms. All crew members are Standards of
Training, Certification and Watchkeeping certified, with dynamic
positioning qualifications and experience where required. The Group
also provides crane operators, medical personnel and other services
depending on contract specifications.
The Group carries out full maintenance inspections of its SESVs
every five years as required by the ABS and carry out interim
inspections every two-and-a-half years. Regular inspections and
preventative maintenance enhance the performance and the health and
safety record of its SESVs and have helped minimise unplanned
off-hire time of its SESVs which over the last five years has
averaged less than 1 per cent. The Group's SESVs allow for
in-service maintenance to be performed while they are jacked-up,
which minimises off-hire time for the SESV and non- productive time
for the Group's customers. All of its SESVs are certified according
to international safety standards under the International Safety
Management Code, as per regulatory requirements. In addition, all
of the Group's SESVs are certified by the ABS classification
society, which is a recognised member of the International
Association of Classification Societies certifying the SESVs as
classed for international operations. Its E-Class vessels also have
UK Safety Case certifications for oil and gas operations.
Furthermore, its vessels GMS Endeavour and GMS Endurance have Dutch
safety cases.
(a) E-Class vessels
The Group's four E-Class vessels have an average age of eight
years. Three of its E-Class vessels are currently in the MENA
region and one is in Northwest Europe. The Group's E-Class vessels
are based on the Gusto NG2500X design, which offers higher
technical and operational capabilities than its smaller SESVs. They
are able to travel up to eight knots fully loaded from shore to the
job location. Their DP2 systems, which utilise GPS and lasers,
allow for fast and precise positioning at the customer's site. With
a leg length ranging from 94.2 metres to 104 metres, its E-Class
vessels are able to work in waters up to 80 metres deep (or up to
60 metres in harsh weather environments). This capability expands
the range of operating environments (and accessible platforms) both
within the MENA region, in particular Qatar, and Northwest Europe,
as well as in other regions such as South East Asia and West
Africa. The Group's E-Class vessels have a deck area of 1,035m2,
and a crane capacity ranging from 200 tonnes to 400 tonnes, which
further broadens the scope of work these vessels can address to
include heavier oil and gas lifting operations. Its E-Class vessels
are fully compliant with the latest MOU standard and meets all of
the Society of Naval Architects and Marine Engineers
requirements.
The Group's E-Class vessels are also capable of supporting its
innovative cantilever system which is currently deployed on GMS
Evolution. The key operational advantages of its cantilever
technology include safer operations by eliminating lifting over
live wellheads, a reduction in well-intervention time, and a
radical improvement in transfer time compared to conventional rigs.
These advantages consequently result in cost savings for the field
operator. In addition to the usual marine crew of 16 people, the
operation of its cantilever system, depending on exact client
requirement requires on average an additional seven member
crew.
In July 2020, the Group successfully completed its first well
intervention work scope using this system. Under contract for a NOC
client in the MENA region, this was the first occasion that the
cantilever system has been used on a live well. The work scope
involved a heavy coiled tubing well intervention, required multiple
changes to bottom hole assembly, and was carried out in a third of
the time that this operation would traditionally take.
Additionally, movements between platforms were reduced to a tenth
of the time taken by a conventional drilling rig, which is
customarily used for intervention activities. Following its
successful trail in 2020, the same client awarded a long term
contract that commenced in January 2021.
In 2018, the Group also successfully fitted its innovative boat
landing tower to one of its E-Class vessels operating at a wind
farm. Its boat landing tower facilitates the movement of around 100
people two times per day to and from transfer vessels while its
SESV remains jacked up.
Principal users of the Group's E-Class vessels include IOC, NOC,
EPC and windfarm operators and contractors.
(b) S-Class vessels
The Group's three S-Class vessels have an average age of six
years and are currently operating in the MENA region. The Group's
S-Class vessels are based on the Gusto NG1800X design, which
provides high reliability and flexibility, and offers higher
technical and operational capabilities than its smaller SESVs. They
are able to travel up to seven knots fully loaded from shore to the
job location. Their DP2 systems, which utilise GPS and lasers,
allow for fast and precise positioning at the customer's site. With
a 75 metre leg length, the S-Class vessel is able to work in waters
up to 55 metres deep. The Group's S-Class vessels have a deck area
of 800m2, and a crane capacity of 150 tonnes, which further
broadens the scope of work these vessels can address to include
heavier oil and gas lifting operations.
Principal customers for the Group's S-Class vessels include
NOCs, IOCs and EPCs.
(c) K-Class vessels
The Group's six K-Class vessels have an average age of 14 years.
These vessels were developed and optimised for its core MENA region
market, although it believes that they are also well suited for the
West African and South East Asian markets. The Group's K-Class
vessels are based on a proven Wartsila design and offer high
reliability and flexibility in more benign waters. The Group's
K-Class vessels are able to travel up to four knots fully loaded
from shore to the job location. Most of the vessel's 67.9 metre leg
length and consequent 45 metre water depth capacity (Pepper can
operate in up to 55m water depth) allows access to the majority of
platforms and structures in the MENA region (excluding Qatar and
KSA), West Africa and South East Asia. Most of its K-Class vessels
have a deck area of 600m2 (Pepper has a deck area of 800m2) and a
crane capacity of 36 tonnes to 75 tonnes. Each K-Class vessel is
fully compliant with the latest MOU standard.
Principal customers for the Group's K-Class vessels include
NOCs, IOCs and EPCs.
1.4 Employment of the Group's SESV fleet
One of the key performance indicators for the Group's SESVs is
their utilisation rate. The Group defines utilisation as the
percentage of calendar days in a relevant period during which an
SESV is under contract and in respect of which a customer is paying
a day rate for the charter of the SESV.
The following table sets out utilisation and billable days for
the Group's fleet, by vessel, for each of the years ended 31
December 2018, 2019 and 2020. For the relevant period, the Group's
fleet includes its vessels (owned or leased, as the case may
be).
Year ended 31 December
2020 2019 2018 Average 2018-220
Billable Percentage Billable Percentage Billable Percentage Billable Percentage
days Utilisation days Utilisation days Utilisation days Utilisation
(%) (%) (%) (%)
E-Class Vessels
Endurance 115 34 197 54 336 92 216 60
Endeavour 336 92 263 72 260 71 286 78
Enterprise 303 83 208 57 165 45 226 62
Evolution 182 50 78 21 198 93 153 55
E-Class
Vessels
Average 65 51 73 63
S-Class Vessels
Shamal 318 87 357 95 365 100 343 94
Scirocco 366 100 365 100 169 46 300 82
Sharqi 322 88 344 94 289 79 318 87
S-Class
Vessels
Average 92 96 75 88
K-Class Vessels
Kamikaze 360 98 4 1 342 11 134 37
Kikuyu 184 60 357 98 365 96 298 85
Kawawa 310 85 350 96 365 98 339 93
Kudeta 294 80 334 91 355 73 298 82
Keloa 316 86 217 59 365 100 299 82
Pepper 366 100 220 60 282 5 202 55
K-Class
Vessels
Average 86 68 64 72
Fleet Average 81 69 69 73
The average utilisation rate of the Group's fleet was 81 per
cent. for the year ended 31 December 2020, an increase of 12 per
cent. from the comparable period in 2019. This was mainly driven by
a significant improvement in K-Class vessel utilisation to 86 per
cent. for the year ended 31 December 2020, compared to 68 per cent.
in the same period in 2019 and E-Class vessel utilisation which
rose to 65 per cent. for the year ended 31 December 2020, compared
to 51 per cent. in the same period in 2019, notwithstanding the
fact that two of the four vessels were off hire for a total of six
months, while being relocated from the North Sea to the Middle
East. S-Class utilisation remained stable at 92 per cent. As of 31
December 2020, secured utilisation (including customer options to
extend) for 2021 was 80 per cent, which reflects utilisation levels
not seen since 2016.
The following table set out certain information regarding the
Group's revenue by vessel class for the three years ended 31
December 2020, 2019 and 2018.
Percentage Percentage Percentage
Revenue of Total of Total of Total
2020 (%) 2019 (%) 2018 (%)
E-Class 29.4 29.0 36.0 33.0 52.1 42.0
S-Class 32.1 31.0 35.4 34.0 35.8 29.0
K-Class 41.0 40.0 37.3 33.0 35.4 29.0
Other - - - - - -
Total 102.5 100.0 108.7 100.0 123.3 100
Backlog
The Group considers its backlog position to be robust,
notwithstanding the disruption caused by COVID-19 and drop in oil
prices, which has pushed back some tender activity in the short
term. As at 31 December 2020, the Group had a secured backlog of
U.S.$220.2 million, of which U.S.$91.4 million was composed of
customer extension options. The Group's secured backlog is down by
U.S.$26.7 million (10.8 per cent.) compared to December 2019.
The Group typically seek to deploy its SESVs across a portfolio
of contracts balanced between long and short- term contracts. The
Group believes that this allows it to maximise its utilisation
rates across the its fleet, maintain visibility over its short- to
medium-term cash flows, and manage customer concentration risk and
exposure to oil and gas sector cycles.
Eight new contract awards were announced in the year 2020 with a
combined charter period of just under 7 years, including contract
extensions. As of 31 December 2020, 9 vessels were on hire, with
four of the fleet of 13 currently on long term contracts of 3 - 5
years.
The following table
sets out a breakdown
of the Group's backlog
as at 31 December 2020.
(US $ million) 2025 2024 2023 2022 2021 Total
Firm Period - 0.2 6.6 29.4 92.6 128.8
Extension Option - 10.3 36.2 36.3 8.5 91.4
Total - 10.5 42.8 65.7 101.1 220.2
As at 31 December 2020, the average full term of the Group's
contracts (including portions already completed at that date) was 2
years, including extension options. The Group continues to receive
enquiries regarding vessel availability globally and believe that
its current level of backlog is sustainable and capable of growing
as the market recovers.
1.5 Customers
The Group charters its vessels to a blue-chip customer base,
including NOCs, IOCs, EPC contractors and OEMs and offshore
renewable energy companies. The Group has longstanding
relationships with many of these customers, some of which go back
more than 40 years.
The Group's customers are comprised of both the owners of the
oil and gas or renewables assets that require construction and/or
maintenance with the support of its vessels, and EPC contractors
that have been hired by the owner to carry out these services. In
the offshore renewables market, the Group's customers also include
large energy/wind farm providers.
The Group has pre-qualified status with several key regional
NOCs, including ADNOC, Saudi ARAMCO and Qatar Petroleum and their
affiliates, which it believes presents a key competitive advantage
over new market entrants that would be subject to a lengthy and
complex qualification process in order to contract with these NOCs.
Many of the Group's NOC customers also have additional
certification requirements with which it must comply, both for the
vessels and for the experience levels of the crew that operate
them. In addition, its NOC customers often use EPC contractors to
carry-out their activities and any particular charter may be
directly with an EPC contractor. The Group has cultivated
relationships with a range of EPC contractors in addition to
international oil and gas companies to diversify its customer base
and gain access to new markets. EPC work represented 25 per cent.,
9 per cent., and 11 per cent. of revenue in 2018, 2019 and 2020,
respectively.
In the MENA region, direct marketing to existing and potential
NOCs and EPC contractors will continue to be the Group's primary
method of business development. The Group take a similar approach
in Northwest Europe, but also undertake marketing activities
through brokers, which are often appointed by existing or potential
customers.
The following tables set out the Group's revenue by geographic
region for the three years ended 31 December 2018, 2019 and
2020.
Percentage Percentage Percentage
of Total of Total of Total
2020 (%) 2019 (%) 2018 (%)
KSA 17.7 17.0 32.5 30.0 54.9 44.0
UAE 53.4 52.0 35.7 33.0 17.3 14.0
Qatar 19.0 19.0 13.4 12.0 9.8 9.0
Total MENA (1) 90.2 88.0 81.6 75.0 81.9 66.0
Total Europe 12.3 12.0 27.2 25.0 41.4 34.0
Total 102.5 100.0 108.7 100.0 123.3 100.0
(1) NOCs are the predominant customer in the MENA region.
As shown in the table above, the majority of the Group's revenue
during the periods under review was earned from customers located
in the MENA region. The Group's revenue in the MENA region is from
oil and gas services. In 2020 revenue generated in the MENA region
accounted for 88 per cent. of its total revenue, compared to 75 per
cent. in 2019. During 2020, nine of its ten vessel mobilisations
were to new contracts in the Middle East. Within the MENA region,
the Group has seen an increase in revenue from the UAE, which
accounted for 52 per cent. of its total revenues and four of its 13
vessel mobilisations in 2020. In response to increased market
activity within the region, in late 2019, the Group decided to
relocate two of its E-Class vessels from Northwest Europe to MENA.
Consequently, 12 of the Group's ten vessels are now based in the
Middle East. The Group will continue to develop its client
relationships in the MENA region, seeking both long-term and
short-term charters to maximise levels of utilisation, while being
mindful of appropriate operating margins.
Market conditions in Northwest Europe were challenging during
2019 and have continued this trend in 2020, although GMS
utilisation in Northwest Europe was higher than the regional
average. In 2020, revenue generated in Northwest Europe accounted
for 12 per cent. of the Group's total revenue, compared to 25 per
cent. in 2019. The decline in demand in Europe reflected the
phasing of renewable work and a pause in oil and gas activity, as
upstream customers reassessed their development plans. One vessel
remains in the North Sea to meet anticipated future demand as the
next phase of wind farm projects gather pace and is contracted
through to middle of 2022.
The following table sets out the aggregate revenue earned from
customers who individually account for more than 10 per cent. of
the Group's revenue during the periods indicated.
Year ended 31 December
US $ million 2020 2019 2018
Aggregate revenue for
major customers 67.0 75.5 93.6
In the years ended 31 December 2018, 2019 and 2020, these
customers were responsible for 76 per cent., 70 per cent., and 65
per cent. of the Group's revenue, respectively. During the periods
under review, the number of customers individually accounting for
more than ten per cent. of its revenues varied from period to
period. In 2018, 2019 and 2020, there were five, three and three
such customers, respectively.
1.6 Contracts
The Group charters its vessels under T/Cs. The Group secures
T/Cs on either a short- (i.e., less than 12 months), medium (i.e.,
one to three years) or long-term basis (i.e., three to five years).
Contract duration typically depends on the type of work required.
Construction support, wind farm installation and accommodation
contracts tend to run from three to 18 months, while maintenance
support, EOR and well services contracts tend to run on multi- year
contracts of typically between three and five years.
The Group obtains the majority of its T/Cs through competitive
tender processes. Tender processes vary considerably by customer
and project type. The Group's management team has significant
experience in navigating tender processes, which it believes
increases the likelihood of its success in winning contracts. The
tender process begins when a customer issues a request for
quotation or expression of interest. This request is typically sent
to a number of vessel operators and requires an indication of
pricing and availability of the vessel proposed to be used for the
project, as well as other specifications, including the scope of
work, the water depth and the POB capacity required. The customer
then issues an invitation to tender for the project to a selection
of vessel operators that responded, and which qualify to undertake
the required work. Those vessel operators then submit detailed bids
for the project, from which the customer will make a selection
based upon certain criteria which would typically include
availability, price and technical suitability. Bid submission to
NOCs in MENA typically are assessed on any in country value
requirements showing how the company is willing and committed to
improve local content both historically and over the life of the
charter. A limited number of the Group's customers require that it
posts bid bonds when it tenders for the contract and, in certain
cases, it is required to post performance bonds following the award
of the contract.
T/Cs typically require that, in addition to the vessel itself,
which includes any spare parts, maintenance and drydocking, the
Group provides crew, insurance and hotel staff and food. The hotel
staff and food are subcontracted through a third party. Operational
risks of breakdown and repair of the SESV also remain with the
Group. However, the execution risk of the work that is carried out
on board by the client remains with them. Consumable items directly
associated with the work such as fuel, fresh water, port charges
and offshore logistics are also all borne by the customer. Under
T/C contracts, the customer is required to provide fuel and
necessary logistical support from helicopters and supply boats, and
delays and/or losses resulting from adverse weather conditions also
rest with the Group's customers. The Group's contracts follow the
general principles of an international standard form time charter
party, typically BIMCO Supply time 2005. The Group's NOC customers
tend to have their own contract formats that it uses in its
dealings with them.
As a general matter, the Group's NOC customers tend to have
long-term contracts, with lower POB requirements and comparatively
lower day rates. These contracts tend to be retendered on expiry,
but, where the Group is successful in the retender, it sees little
to no downtime for its vessels, which helps to offset the effect of
comparatively lower day rates for long-term contracts, through
improved utilisation, as compared to those contracts of a shorter
duration. There is little or no mobilisation and demobilisation
risk and frequent intrafield moves are often required. The Group's
contracts with EPC customers tend to be short-term, with higher POB
requirements. There is some mobilisation and demobilisation risk
and intrafield movements tend to be less frequent. These
characteristics are applicable in both the MENA region and
Northwest Europe, although contract terms in Northwest Europe have
typically been shorter. In addition, oil and gas customers in
Northwest Europe tend to manage project costs and, consequently,
contracting strategy differs to that of many of the Group's MENA
customers. The Group's contracts contain liability and indemnity
provisions that it believes are standard for the industry and in
most cases stipulate that each party to the contract takes
responsibility for their own property, personnel and any
subcontractors they engage in the performance of the contract.
Contracts also typically contain both "for cause" and "for
convenience" termination provisions. For cause termination would
require a major default by one of the parties. The Group only had
one contract terminated for cause in the last 10 years. A
termination for convenience clause is more common in NOC contracts
and allows termination with a notice period of usually between 15
and 90 days. Termination for convenience is relatively rare (i.e.,
only two instances of this since March 2014 where day rates where
significantly higher than market rates), but, when it occurs, the
Group is paid the contractually agreed day rate for the term of the
notice.
The Group's revenue is derived from its vessel operations and
includes the daily rates it charges to charter the vessel, fees for
hotel and catering services that are charged per person per day,
and, in most cases, charges for the mobilisation and demobilisation
of its vessels. The Group provide catering services through a
third-party supplier with whom it has a long-term relationship.
Mobilisation charges, where applicable, reflect the cost of making
the vessel ready to go on hire (including any quarantine periods
related to COVID-19) positioning the SESV to the new contract
location, and in some cases, particularly shorter term contracts,
the cost of any modifications or upgrades required to be made to
perform under the new contract. Demobilisation charges, where
applicable, include the cost of reinstating the SESV to the
original condition at the end of the contract and repositioning.
These are typically lump sum charges paid by the customer at the
beginning and the end of the contract, respectively.
The substantial majority of the Group's contracts are negotiated
with an extension option clause for a certain length and day rate
term. The options are exercisable at the customer's discretion with
usually between 30 and 180 days' notice, depending on the duration
of the option period. If the Group's customer elects to extend the
contract, the existing day rates typically continue to apply. In
the MENA region, the Group's primary market, its NOC customers in
most cases exercise their extension options rather than renegotiate
a new chartering contract, given the complex internal approval
process a new contract requires.
In 2020, the Group entered a first-time agreement to supply
manpower services on board one of its vessels under time charter to
a UAE NOC. In accordance with the terms of this agreement, the
Group provides approximately 100 skilled tradesmen that supports
its client's on-board maintenance work. The workforce is entirely
under the control and direction of the client. The same client has
included the provision of similar manpower services to be included
in tenders that are currently in the market, which it perceives as
a shift in strategy from the client as it looks to integrate
additional, non-core, services into time charters with a view to
benefit from efficiencies in time and cost by utilising the supply
chain to provide these services.
1.7 Procurement and suppliers
The Group maintains long-term relationships with the its
high-quality core suppliers through the initial sourcing of
components and often through ongoing maintenance agreements for the
Group's SESVs. The Group's key suppliers include Rolls Royce,
Hydralift, BLM, Kongsberg, Gusto MSC and Wartsila. The Group
believes that the length and depth of its relationships with its
key suppliers are critical as they allow it to benefit from
substantial economies of scale in the procurement of goods and
services such as equipment parts and subcontracting work, which
strengthens the viability of its low-cost model. Relationships with
suppliers and subcontractors also provide the Group with market
intelligence on technologies which are sought after by end-users.
The Group's supplier relationships also allow quick turnaround of
any urgent and unscheduled maintenance work or order changes.
Supplier concentration risk is mitigated by the diversity of
components required in the maintenance of the Group's modern, young
fleet, which results in it having to source equipment for its
vessels from a diverse pool of suppliers. While the Group has a
preference to use the same group of major providers for each
vessel, which results in lower inventory of critical spares, a
tendering process is used to ensure that suppliers remain
competitive on price. When tendering for major vessel components,
the main factors the Group considers in awarding contracts are
quality, price and delivery schedule.
1.8 Competition
The Group competes with operators of marine offshore service
vessels in the MENA region and Northwest Europe to provide support
services to customers in the oil and gas and offshore renewable
energy markets, respectively. During the periods under review, the
Group has faced increasing competition as other market participants
have increased the supply of SESVs in the markets in which it
operates. Average utilisation remained constant throughout 2019 at
69 per cent. (2018: 69 per cent.). Utilisation in 2020 increased to
81 per cent., which was mainly driven by a significant improvement
in the utilisation of K-Class vessels and E-Class vessels.
Given existing market conditions, where the Group's customers
are able to express a preference as to vessel specifications due to
lower levels of utilisation across the industry, it expects that no
new tonnage is likely to enter the market in the medium term and.
nearly all previously available stock in shipyards is destined for
China windfarms. The Group's S-Class and E-Class vessels will,
therefore, are unlikely to face increasing competition in the
future from new vessels coming into the industry which may have
lower costs of capital. Nevertheless, the Group believes that its
E-Class vessels offer customers higher technical specifications
than most of its competitors' new and existing vessels and it is
able to offer them at competitive day rates. The Group believes
this is especially helpful in the tendering process as increasingly
its customers are demonstrating a preference, and in some cases a
requirement, for modern vessels that provide significant cost and
operational efficiencies. The Group regards its primary competitors
to be Seajacks, Jack-Up Barge BV, Seafox, Zakher Marine, and
Navtech.
1.9 Property
The Group leases the property on which offices are located in
International Tower, Abu Dhabi pursuant to a three- year lease. The
Group also leases small regional offices in Khobar (Saudi Arabia)
and Doha (Qatar).
1.10 Insurance
The Group carries insurance that the Group believes is common in
its industry and sufficient to cover the principal risks of damage
to its business. The Group's coverage includes hull and machinery
coverage and its fleet is insured for market value or book value if
higher. The Group also has third party liability cover for the
Group's vessels. In addition, it has several other standard
insurance policies in place covering workmen's compensation,
employers' liability and property insurance, among other things. In
common with other companies in the Group's industry, and due to
high cost and limited cover, it does not carry business
interruption insurance to compensate it for lost revenue in the
event that one of the its vessels is damaged.
1.11 Health and Safety and Environment
The Group places a high priority on managing the risks inherent
in the industry in which it operates, and it is committed to
compliance with the highest national and international HSE
standards. The Group employs an integrated management system
covering the quality, health, safety and environmental principles
and objectives of its business, which is implemented throughout all
offshore and onshore operations and aims to provide innovative and
sustainable solutions to monitor its HSE performance and
continuously improve the necessary safeguards to protect its
employees and minimise its impact on the environment. This system
complies with the internationally recognised ISO standards,
including ISO 9001, ISO 14001 and OHSAS 18001, and has received all
local environmental certifications. The Group has UK North Sea
Safety Case to operate its four E-Class vessels.
(a) Health and safety
Health and safety is a key priority for the Group in both the
its onshore and offshore operations. Over the years, the Group has
implemented robust health and safety reporting policies to maximise
preventative maintenance and risk management. The Group's
integrated health management system is accredited by the ABS.
Health and safety records are often considered by its customers
when assessing bids for tenders and it regards its historical
performance in this area as a competitive advantage. For the year
ended 31 December 2018, the Group had zero lost time incidents
(meaning an injury that requires more than three days off work) and
the Group's total recordable injury rate was zero. In 2019, the
Group's total recordable injury rate was 0.29 and its lost time
injury rate was 0.19 (in each case, per 200,000 man hours). In
2020, the lost time injury rate returned to zero. There were no
serious near misses or high potential incidents during any of the
periods under review.
(b) Environment
The Group is committed to conducting its business in a manner
that protects the environment and preserves the areas in which it
operates. Key areas of focus for the Group's environmental policy
include the prevention of pollution incidents in the context of its
offshore and onshore operations. The Group has taken measures to
reduce its emissions such as changing its refrigerant usage across
all of its vessels and reducing its office and facilities
footprint. All the Group's vessels are already configured to run on
low sulphur marine diesel. The Group completes on a regular basis a
detailed environmental impact assessment for its operations to
identify weak areas in its environmental management. The Group has
also invested significant resources over recent years in carrying
out an environmental campaign to increase the awareness of its
employees and contractors and promote positive behaviour towards
the environment. During the periods under review, there were no
environmental incidents across its operations.
While many of the Group's customers in the oil and gas industry
use its vessels to support activities that are inherently
hazardous, its liability for environmental damage resulting from an
incident with one of its vessels is limited. The Group's contracts
typically contain "knock-for-knock" provisions which restrict its
liability to damage to its own vessels and personnel.
(c) Employees
The Group employed an international workforce of 532 full-time
employees as at 31 December 2020. Approximately 10 per cent. of its
employees are onshore-based, primarily employed at its headquarters
in Abu Dhabi. They cover all areas of operation, including vessel
operations, commercial and business development, technical and,
finance, human resources, procurement, HSE and IT, and provide
support to the whole fleet. The remaining 90 per cent. of its
employees comprise offshore crew. They man the vessels and are
responsible for the day-to-day operations of the fleet. In
addition, the Group has a small team based in Qatar and KSA, which
provides on-the-ground support to its marine activities in those
markets.
APPIX III - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING OF NEW ORDINARY SHARES (THE "PLACING") IN GULF MARINE
SERVICES PLC (THE "COMPANY") SUBJECT TO A RIGHT OF RECALL IN
RESPECT OF VALID APPLICATIONS BY QUALIFYING SHAREHOLDERS PURSUANT
TO THE OPEN OFFER (THE "OPEN OFFER", AND TOGETHER WITH THE PLACING,
THE "CAPITAL RAISING"). THIS ANNOUNCEMENT (INCLUDING THIS APPIX
III) 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(e) OF REGULATION (EU) 2017/1129 (THE "EU PROSPECTUS
REGULATION"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS AS
DEFINED IN ARTICLE 2(e) OF REGULATION (EU) 2017/1129 AS IT FORMS
PART OF THE UNITED KINGDOM DOMESTIC LAW BY VIRTUE OF THE EUROPEAN
UNION (WITHDRAWAL) ACT 2018 (THE "EUWA") (THE "UK PROSPECTUS
REGULATION"); 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; AND (3) OTHERWISE, PERSONS TO
WHOM IT IS OTHERWISE LAWFUL TO COMMUNICATE IT TO (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 THE COMPANY.
THE NEW ORDINARY SHARES TO BE OFFERED IN CONNECTION WITH THE
CAPITAL RAISING (THE "NEW ORDINARY 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
NEW ORDINARY 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 NEW ORDINARY SHARES IS BEING MADE IN THE UNITED STATES OR
ELSEWHERE.
UAE EXEMPT OFFER NOTICE
This announcement has not been reviewed or approved by any
regulatory authority, including the Central Bank of the United Arab
Emirates (the " UAE" ), Emirates Securities and Commodities
Authority or any regulatory authority in any free zones established
and operating in the territory of the UAE.
The announcement does not constitute, and is not intended to
constitute, a public offer of securities in the UAE or any free
zones established and operating in the territory of the UAE and
accordingly should not be construed as such. Any securities in any
offering referred to in this announcement are only being offered to
a limited number of qualified investors in the UAE who are willing
and able to conduct an independent investigation of the risks
involved in an investment in such securities. This announcement is
for the use of the named addressee only and should not be given or
shown to any other person (other than employees, agents or
consultants in connection with the addressee's consideration
thereof).
ADGM EXEMPT OFFER NOTICE
This announcement is for distribution only to persons who (a)
are outside the Abu Dhabi Global Market, or (b) are Authorised
Persons or Recognised Bodies (as such terms are defined in the ADGM
Financial Services and Markets Regulations 2015 (" FSMR" )), or (c)
are persons to whom an invitation or inducement to engage in
investment activity (within the meaning of section 18 of the FSMR)
in connection with the issue or sale of any securities may
otherwise lawfully be communicated or caused to be communicated
(all such persons together being referred to as "relevant persons"
for the purposes of this paragraph). This announcement is directed
only at relevant persons and must not be acted on or relied on by
persons who are not relevant persons. Any investment or investment
activity to which this announcement relates is available only to
relevant persons and will be engaged in only with relevant
persons.
This announcement relates to an Exempt Offer in accordance with
the Market Rules of the ADGM Financial Services Regulatory
Authority (" FSRA" ). This announcement is intended for
distribution only to persons of a type specified in the Market
Rules of the ADGM. It must not be delivered to, or relied on by,
any other person. The FSRA has no responsibility for reviewing or
verifying any prospectus or other documents in connection with this
Offering. The FSRA has not approved this announcement or any other
associated documents nor taken steps to verify the information set
out in this announcement, and has no responsibility for it nor any
offering memorandum. The securities to which this announcement
relates may be illiquid and/or subject to restrictions on their
resale. Prospective purchasers of the securities offered should
conduct their own due diligence on the securities. If you do not
understand the contents of this announcement you should consult an
authorized financial advisor.
DIFC EXEMPT OFFER NOTICE
This announcement is for distribution only to persons who (a)
are outside the Dubai International Financial Centre, or (b) are
persons who meet the Professional Client criteria set out in Rule
2.3.4 of the DFSA Conduct of Business Module (all such persons
together being referred to as " relevant persons" for the purposes
of this paragraph). This announcement is directed only at relevant
persons and must not be acted on or relied on by persons who are
not relevant persons. Any investment or investment activity to
which this announcement relates is available only to relevant
persons and will be engaged in only with relevant persons.
This announcement is intended to provide information about
investments and investment services which are not subject to any
form of regulation or approval by the Dubai Financial Services
Authority (" DFSA" ). This announcement relates to an Exempt Offer
of securities in accordance with the Offered Securities Rules of
the DIFC Financial Services Authority (" DFSA" ). This announcement
is intended for distribution only to persons of a type specified in
the Offered Securities Rules of the DFSA. It must not be delivered
to, or relied on by, any other person. The DFSA has no
responsibility for reviewing or verifying any prospectus or other
documents in connection with this CAPITAL RAISING. Accordingly, the
DFSA has not approved this announcement or any other associated
documents nor taken steps to verify the information set out in this
announcement, and has no responsibility for it nor any offering
memorandum. The securities to which this announcement relates may
be illiquid and/or subject to restrictions on their resale.
Prospective purchasers of the securities offered should conduct
their own due diligence on the securities. If you do not understand
the contents of this announcement you should consult an authorized
financial advisor.
NOTICE TO INVESTORS IN THE KINGDOM OF SAUDI ARABIA
This announcement may not be distributed in the Kingdom of Saudi
Arabia ("Saudi Arabia" or the "KSA"), except to such persons as are
permitted under the Rules on the Offer of Securities and Continuing
Obligations (the "Saudi Regulations") issued by the Board of the
Capital Market Authority (the "Capital Market Authority") pursuant
to resolution number 3-123-2017, dated 27 December 2017, based on
the Capital Market Law issued by Royal Decree No. M/30 dated
2/6/1424H (as amended by Resolution of the Board of the Capital
Market Authority number 1-104-2019 dated 30 September 2019G (the
"2019 Saudi Regulations"), and Resolution of the Board of the
Capital Market Authority number 1-7-2021 dated 14 January 2021G
(the "2021 Saudi Regulations"), noting that certain provisions of
the 2021 Saudi Regulations only come into force on 1 January
2022G).
The Capital Market Authority does not make any representation as
to the accuracy or completeness of this announcement, and expressly
disclaims any liability whatsoever for any loss arising from, or
incurred in reliance upon, any part of this announcement.
Prospective purchasers of the securities offered hereby should
conduct their own due diligence on the accuracy of the information
relating to the securities. If a prospective purchaser does not
understand the contents of this announcement, he or she should
consult an authorised financial adviser.
The New Ordinary Shares and the Open Offer Entitlements must not
be advertised, offered or sold and no memorandum, information
circular, brochure or any similar document has or will be
distributed, directly or indirectly, to any person in Saudi Arabia
other than to Sophisticated Investors within the meaning of Article
9 of the 2019 Saudi Regulations.
The Capital Raising in Saudi Arabia shall not, therefore,
constitute a "public offer" pursuant to the Saudi Regulations.
Prospective investors are informed that Article 15 of the 2019
Saudi Regulations (and Article 14 of the 2021 Saudi Regulations)
places restrictions on secondary market activity with respect to
the Shares. Any resale or other transfer, or attempted resale or
other transfer, made other than in compliance with the Saudi
Regulations shall not be recognised.
THIS ANNOUNCEMENT (INCLUDING THIS APPIX III) 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.
THIS ANNOUNCEMENT IS NOT FOR PUBLICATION OR DISTRIBUTION,
DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE OR
SUBSCRIPTION INTO THE UNITED STATES. THE SECURITIES REFERRED TO
HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES,
EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION. NO
PUBLIC OFFERING IS BEING MADE IN THE UNITED STATES.
Unless otherwise defined herein, capitalised terms shall have
the meaning given to them in this Announcement.
In connection with the Capital Raising and Admission, the final
approved combined circular and prospectus (the "Prospectus")
prepared by, and relating to, the Company is expected to be dated
on 9 June 2021. The Prospectus will, subject to the approval by the
FCA, be published on the Company's website and made available to
Placees and will be despatched by the Company to its Shareholders
(other than those who have elected or have deemed to have elected
to receive soft copy, e-mail notifications or postal notifications
of the publication of documents). The Prospectus is not expected to
be approved and published prior to Placees entering into a legally
binding commitment in respect of the Placing with Panmure Gordon
(UK) Limited ("Panmure Gordon"), as agent, as well as Emirates NBD
Capital Limited ("ENBD" and together with Panmure Gordon, the
"Joint Bookrunners"), for and on behalf of the Company. As such,
any commitments made under the Placing will be on the basis of 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 out in the
contract note or electronic trade confirmation to be sent to
individual Placees.
The Placing will consist of an offer of 370,706,162 new ordinary
shares of 2 pence each ("Ordinary Shares") in the capital of the
Company by way of a placing with institutional investors subject to
a right of recall to satisfy valid acceptances by Qualifying
Shareholders pursuant to the Open Offer (the "Placing Shares"). If
a person indicates to the Joint Bookrunners that it wishes to
participate in the Placing by making an oral or written offer to
acquire Placing Shares pursuant to the terms of the Placing (each
such person, a "Placee"), such person will be deemed: (i) to have
read and understood in their entirety this Appendix III and the
Announcement; (ii) to be participating and making such offer on the
terms and conditions contained in this Appendix III; and (iii) to
be providing the representations, warranties, indemnities,
agreements, undertakings, acknowledgements and confirmations
contained in these terms and conditions in this Appendix III.
The distribution of this Announcement and/or the Capital Raising
and/or the issue of the New Ordinary Shares in certain
jurisdictions may be restricted by law. No action has been taken by
the Company, the Joint Bookrunners or any of their Representatives
that would permit an offer of the New Ordinary Shares or possession
or distribution of this Announcement or any other offering or
publicity material relating to such New Ordinary 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 New Ordinary Shares is being
made in any such jurisdiction.
The New Ordinary 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 Capital Raising 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 from the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the New Ordinary Shares and the New
Ordinary 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 the United States, Australia, Canada, the
Republic of South Africa or Japan. Accordingly, the New Ordinary
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 the United States, 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 such 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 Bookbuilding Process and the Placing,
each Placee 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 this
Appendix III.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF A SUBSCRIPTION FOR
THE PLACING SHARES.
In particular, each such Placee represents, warrants,
undertakes, agrees and acknowledges (amongst other things) to the
Joint Bookrunners and the Company 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 the United Kingdom who
acquires any Placing Shares pursuant to the Placing:
(a) it is a Qualified Investor within the meaning of Article
2(e) of the UK Prospectus Regulation; and
(b) in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 5(1) of the
UK Prospectus Regulation:
(i) 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 the United Kingdom other
than Qualified Investors or in circumstances in which the prior
consent of Panmure Gordon been given to the offer or resale; or
(ii) where Placing Shares have been acquired by it on behalf of
persons in the United Kingdom other than Qualified Investors, the
offer of those Placing Shares to it is not treated under the UK
Prospectus Regulation as having been made to such persons; and
3. in the case of a Relevant Person in a member state of the EEA
(each a "Relevant State") who acquires any Placing Shares pursuant
to the Placing:
(a) it is a Qualified Investor within the meaning of Article
2(e) of the EU Prospectus Regulation; and
(b) in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 5(1) of the
EU Prospectus Regulation:
(i) 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 a Relevant State other than
Qualified Investors or in circumstances in which the prior consent
of Panmure Gordon been given to the offer or resale; or
(ii) where Placing Shares have been acquired by it on behalf of
persons in a Relevant State other than Qualified Investors, the
offer of those Placing Shares to it is not treated under the EU
Prospectus Regulation as having been made to such persons; and
4. in the case of a person in the Dubai International Financial
Centre who acquires any Placing Shares pursuant to the Placing:
(a) it is it is a "Professional Client" as defined in the DIFC
Conduct of Business Module, other than natural persons; and
(b) it acknowledges that it is acquiring the Placing Shares in
the context of an offering that qualifies as a private placement
under DIFC law;
5. in the case of a person in the Abu Dhabi Global Market who
acquires any Placing Shares pursuant to the Placing:
(a) it is it is a "Professional Client" as defined in the ADGM
Conduct of Business Rulebook, other than natural persons; and
(b) it acknowledges that it is acquiring the Placing Shares in
the context of an offering that qualifies as a private placement
under ADGM law;
6. in the case of a person in the Kingdom of Saudi Arabia:
(a) it is it is a "Sophisticated Investor" as defined in the
Capital Market Law issued by Royal Decree No. M/30 dated 2/6/1424H
(as amended by Resolution of the Board of the Capital Market
Authority number 1-104-2019 dated 30 September 2019G); and
(b) it acknowledges that it is acquiring the Placing Shares in
the context of an offering that qualifies as a private placement
under the KSA rules;
7. 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; and
8. 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 III;
and
9. 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 8 above) is outside of the
United States acquiring the Placing Shares in offshore transactions
as defined in and in accordance with Regulation S under the
Securities Act; and
10. the Company and the Joint Bookrunners will rely upon the
truth and accuracy of the foregoing representations, warranties,
acknowledgements and agreements.
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 information in this Announcement or
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 Representatives 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. 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
Panmure Gordon has today entered into a placing agreement (the
"Placing Agreement") and ENBD has today entered into an engagement
letter (the "ENBD Engagement Letter"), with the Company under
which, on the terms and subject to the conditions set out in the
Placing Agreement and the ENBD Engagement Letter, Panmure Gordon
and ENBD, as agents for and on behalf of the Company, have agreed
to use their reasonable endeavours to procure Placees for the
Placing Shares. Placees for Placing Shares are subject to a right
of recall to satisfy valid applications by Qualifying Shareholders
under the Open Offer. The Placing is being fully underwritten by
Panmure Gordon on the terms and subject to the conditions set out
in the Placing Agreement.
Applications for listing and admission to trading
Applications will be made to: (i) the FCA for admission of the
New Ordinary Shares to the premium listing segment of the Official
List and (ii) London Stock Exchange plc (the "London Stock
Exchange") for admission of the New Ordinary Shares to trading on
its main market for listed securities (together, "Admission").
Application will also be made to Euroclear UK & Ireland
Limited for the entitlements to the Open Offer Shares (the "Open
Offer Entitlements") to be admitted as separate participating
securities within CREST. Subject to the conditions of the Placing
Agreement being satisfied, it is expected that Admission of the New
Ordinary Shares will become effective on 28 June 2021 and that
dealings in the New Ordinary Shares will commence at the same
time.
The New Ordinary Shares to be issued under the Capital Raising
will, when issued and fully paid, be identical to, and rank pari
passu in all respects with, the existing Ordinary Shares in issue
including the right to receive all dividends and other
distributions declared, made or paid on the Ordinary Shares by
reference to a record date on or after Admission.
The Capital Raising is conditional, amongst other things,
upon:
1. the Prospectus being approved pursuant to the Prospectus
Regulation Rules and the FSMA by the FCA as soon as practicable on
9 June 2021;
2. the Resolutions having been duly passed (without amendment) at the General Meeting;
3. Admission having become effective at or before 8.00 a.m. on
28 June 2021 or such later date as Panmure Gordon may agree being
no later than 8.00 a.m. on 29 June 2021; and
4. the Placing Agreement and the ENBD Engagement Letter having
become unconditional in all respects and not having been terminated
by the relevant Joint Bookrunner in accordance with its terms prior
to Admission.
The full terms and conditions of the Open Offer will be
contained in the Prospectus. The Prospectus is expected to be
approved by the FCA under section 87A of the FSMA and made
available to the public in accordance with Rule 3.2 of the
Prospectus Regulation Rules made under Part VI of the FSMA.
The Bookbuilding Process
The Joint Bookrunners will commence the Bookbuilding Process to
determine demand for participation in the Placing by Placees
immediately following the publication of this Announcement. This
Appendix III gives details of the terms and conditions of, and the
mechanics of participation in, the Placing. No commissions will be
paid to Placees or by Placees in respect of any Placing Shares.
The Joint Bookrunners and the Company shall be entitled to
effect the Placing by such alternative method to the Bookbuilding
Process as they may, in their sole discretion, determine.
Principal terms of the Bookbuilding Process and the Placing
1. The Joint Bookrunners are acting as bookrunners to the
Placing, as agent 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
affiliates are entitled to enter bids in the Bookbuilding
Process.
3. The price per Placing Share (the "Issue Price") is fixed at 3
pence and is payable to the Joint Bookrunners (as agents for the
Company) by all Placees whose bids are successful. The number of
Placing Shares will be agreed between the Joint Bookrunners and the
Company following completion of the Bookbuilding Process. The
number of Placing Shares will be announced by the Company (the
"Placing Results Announcement") following the completion of the
Bookbuilding Process and the entry into the Results Agreement by
the Company and Panmure Gordon.
4. To bid in the Bookbuilding Process, Placees should
communicate their bid by telephone or email to their usual sales
contact at the Joint Bookrunners. Each bid should state the number
of Ordinary Shares which a Placee wishes to acquire at the Issue
Price. Bids may be scaled down by the Joint Bookrunners on the
basis referred to in paragraph 9 below. The Joint Bookrunners are
arranging the Placing as agents of the Company.
5. The Bookbuilding Process is expected to close no later than
5.00 p.m. on 9 June 2021 but may be closed earlier or later subject
to the agreement of the Joint Bookrunners and the Company. The
Joint Bookrunners may, in agreement with the Company, accept bids
that are received after the Bookbuilding Process has closed. The
Company reserves the right (upon agreement of the Joint
Bookrunners) to reduce or seek to increase the amount to be raised
pursuant to the Placing, in its discretion.
6. Each Placee's allocation will be determined by the Joint
Bookrunners in their discretion following consultation with the
Company and will be confirmed to Placees either orally or by email
by the Joint Bookrunners. The Joint Bookrunners may choose to
accept bids, either in whole or in part, on the basis of
allocations determined at its absolute discretion, in consultation
with the Company, and may scale down any bids for this purpose on
the basis referred to in paragraph 9 below.
7. The Company will release the Placing Results Announcement
following the close of the Bookbuilding Process detailing the
aggregate number of the Placing Shares to be issued.
8. Each Placee's allocation and commitment will be evidenced by
a contract note or electronic trade confirmation issued to such
Placee by the Joint Bookrunners. The terms of this Appendix III
will be deemed incorporated in that contract note or electronic
trade confirmation.
9. Subject to paragraphs 4, 5 and 6 above, the Joint Bookrunners
may choose to accept bids, either in whole or in part, on the basis
of allocations determined at their discretion and may scale down
any bids for this purpose on such basis as they may determine or be
directed. The Joint Bookrunners may also, notwithstanding
paragraphs 4, 5 and 6 above, subject to the prior consent of the
Company:
(a) allocate Placing Shares after the time of any initial
allocation to any person submitting a bid after that time; and
(b) allocate Placing Shares after the Bookbuilding Process has
closed to any person submitting a bid after that time.
10. Each Placee's allocation and commitment to acquire Placing
Shares (subject to recall) so allocated will be made on the terms
and subject to the conditions in this Appendix III and the
Announcement and will be legally binding on the Placee on behalf of
which it is made and except with the Joint Bookrunners' 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 Joint
Bookrunners (as agents for the Company), to pay to them (or as they
may direct) in cleared funds an amount equal to the product of the
Issue Price and, once apportioned after recall (in accordance with
the procedure described in the paragraph entitled "Placing
Procedure" below), the Placing Shares, which such Placee has agreed
to acquire and the Company has agreed to allot and issue to that
Placee.
11. Except as required by law or regulation, no press release or
other announcement will be made 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.
12. 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 acquired pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under "Registration and Settlement".
13. All obligations under the Bookbuilding Process and 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".
14. By participating in the Bookbuilding Process, 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.
15. To the fullest extent permissible by law and applicable FCA rules, neither:
(a) either Joint Bookrunner;
(b) any of its affiliates, agents, directors, officers,
consultants, partners or employees; nor
(c) to the extent not contained within (a) or (b), any person
connected with the relevant Joint Bookrunner as defined in the FSMA
((b) and (c) being together "affiliates" and individually an
"affiliate" of the Joint Bookrunner);
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 Joint Bookrunner nor any of its affiliates shall have any
liability (including, to the extent permissible by law, any
fiduciary duties) in respect of the Joint Bookrunner's conduct of
the Bookbuilding Process 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 Placing Shares in the Placing they
will be sent a contract note or electronic trade confirmation which
will confirm the number of Placing Shares allocated to them, the
Issue Price and the aggregate amount owed by them to the Joint
Bookrunners.
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 Joint Bookrunners 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:
GB00BJVWTM27) following Admission will take place within the CREST
system, subject to certain exceptions. Settlement through CREST
will be on a T+1 basis unless otherwise notified by Panmure Gordon
and is expected to occur on 28 June 2021 (the "Settlement Date") in
accordance with the contract notes or electronic trade
confirmations. 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 Panmure Gordon may agree
that the Placing Shares should be issued in certificated form.
Panmure Gordon 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 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 2 percentage points above the prevailing base rate of
Barclays Bank PLC as determined by Panmure Gordon.
Each Placee is deemed to agree that, if it does not comply with
these obligations, the Joint Bookrunners may sell any or all of the
Placing Shares allocated to that Placee on their behalf and retain
from the proceeds, for the Joint Bookrunners' 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 Issue Price. By communicating a
bid for Placing Shares, such Placee confers on the Joint
Bookrunners all such authorities and powers necessary to carry out
such sale and agrees to ratify and confirm all actions which the
Joint Bookrunners lawfully take in pursuance of such sale.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional contract note or the electronic trade 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. If there are any circumstances in
which any United Kingdom stamp duty or stamp duty reserve tax or
other similar taxes or duties (including any interest and penalties
relating thereto) is payable in respect of the allocation,
allotment, issue, sale, transfer or delivery of the Placing Shares
(or, for the avoidance of doubt, if any stamp duty or stamp duty
reserve tax is payable in connection with any subsequent transfer
or agreement to transfer Placing Shares), the Company shall not be
responsible for payment thereof. 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 Panmure Gordon under the Placing Agreement,
and the Placing, are conditional upon, inter alia:
(a) the Prospectus being approved pursuant to the Prospectus
Regulation Rules and the FSMA by the FCA as soon as practicable on
9 June 2021;
(b) the Resolutions having been duly passed (without amendment) at the General Meeting;
(c) none of the representations, warranties and undertakings on
the part of the Company contained in the Placing Agreement being
untrue, inaccurate or misleading at each significant time (being.
4.45 p.m. on the date on which the Results Agreement is signed, the
date of the Prospectus, the date of any supplementary prospectus
published prior to Admission and Admission or such other time as is
notified to the Company by Panmure Gordon or Admission), by
reference to the facts and circumstances then subsisting;
(d) the Company complying with its obligations under the Placing
Agreement to the extent that they fall to be performed on or before
Admission;
(e) the Company and Panmure Gordon agreeing the final number of
Placing Shares and executing the Results Agreement no later than
4.45 p.m. on the date of this Announcement (or such later time
and/or date as Panmure Gordon may agree with the Company);
(f) the Company having allotted, subject only to Admission, the
New Ordinary Shares in accordance with the Placing Agreement;
(g) no event requiring the publication of a supplementary
prospectus pursuant to the Prospectus Regulation Rules arising
between the time of publication of the Prospectus and Admission and
no supplementary prospectus being published by or on behalf of the
Company before Admission; and
(h) Admission having become effective at or before 8.00 a.m. on
28 June 2021 or such later date as Panmure Gordon may agree being
no later than 8.00 a.m. on 29 June 2021,
(all conditions to the obligations Panmure Gordon included in
the Placing Agreement being together, the "conditions").
If any of the conditions are not fulfilled or, where permitted,
waived by Panmure Gordon in accordance with the Placing Agreement
within the stated time periods (or such later time and/or date as
the Panmure Gordon may decide), 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 Bookbuilding Process, 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.
Panmure Gordon may, in its absolute discretion and upon such
terms as it thinks fit, waive fulfilment of all or any of the
conditions in whole or in part, or extend the time provided for
fulfilment of one or more conditions, save that certain conditions
including the condition relating to Admission referred to in
paragraph (h) above may not be waived. Any such extension or waiver
will not affect Placees' commitments as set out in this Appendix
III.
Panmure Gordon may terminate the Placing Agreement in certain
circumstances, details of which are set out below.
Neither Panmure Gordon nor any of its affiliates 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
Panmure Gordon.
Termination of the Placing
Panmure Gordon may, in its absolute discretion, by notice to the
Company, terminate the Placing Agreement at any time up to
Admission if, amongst other things, in opinion of Panmure
Gordon:
(a) there has been a breach of the warranties given to it;
(b) there has been a material adverse change;
(c) any material statement contained in this Announcement, the
Prospectus, the Placing Results Announcement or any other document
or announcement issued or published by or on behalf of the Company
in connection with the Capital Raising is or has become or has been
discovered to be untrue or inaccurate in any material respect or
misleading; or
(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
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 Bookbuilding Process, each Placee agrees
with the Company and Panmure Gordon that the exercise by the
Company or Panmure Gordon 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 Panmure Gordon or
for agreement between the Company and Panmure Gordon (as the case
may be) and that neither the Company nor Panmure Gordon need make
any reference to such Placee and that none of the Company, Panmure
Gordon nor any of their respective Representatives 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. Each Placee further agrees that they will have no
rights against Panmure Gordon, the Company or any of their
respective directors or employees under the Placing Agreement
pursuant to the Contracts (Rights of Third Parties) Act 1999 (as
amended).
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 Panmure Gordon of a contract note or electronic
trade confirmation confirming each Placee's allocation and
commitment in the Placing.
Placing Procedure
Placees shall subscribe for the Placing Shares to be issued
pursuant to the Placing and any allocation of the Placing Shares
(subject to recall) to be issued pursuant to the Placing will be
notified to them on or 9 June 2021 (or such other time and/or date
as the Company and the Joint Bookrunners may agree).
Placees will be called upon to subscribe for, and shall
subscribe for, the Placing Shares only to the extent that valid
applications and payment in full by Qualifying Shareholders (other
than the Committed Shareholders) under the Open Offer are not
received by 11.00 a.m. on 24 June 2021 or if applications have
otherwise not been deemed to be valid in accordance with the terms
set out in the Prospectus and the Application Form. Placees will be
called upon to subscribe for, and shall subscribe for, the number
of Placing Shares comprised in their allocation multiplied by the
proportion of Open Offer Shares (minus the Committed Shares) which
are not taken up or deemed to have been taken up in accordance with
the terms set out in the Prospectus and the Application Form.
Payment in full for any Placing Shares so allocated in respect
of the Placing at the Issue Price must be made by no later than 28
June 2021. The Joint Bookrunners will notify Placees if any of the
dates in these terms and conditions should change, including as a
result of delay in the posting of the Prospectus, the Application
Form or the crediting of the Open Offer Entitlements in CREST or
the production of a supplementary prospectus or otherwise.
Representations, warranties and further terms
By submitting a bid in the Bookbuilding Process, each Placee
(and any person acting on such Placee's behalf) irrevocably
confirms, represents, warrants, acknowledges and agrees (for itself
and for any such prospective Placee) with the Company and each
Joint Bookrunner (in its capacity as joint bookrunner and placing
agent of the Company in respect of the Placing) 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 Placing Shares is subject to and
based upon all the terms, conditions, representations, warranties,
indemnities, acknowledgements, agreements and undertakings and
other information contained in the Announcement (and in particular,
and without limitation, you acknowledge that your participation in
the Placing is subject to a right of recall to satisfy valid
acceptances under the terms of the Open Offer) 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
New Ordinary Shares or otherwise, other than the information
contained in this Announcement and the Publicly Available
Information;
2. you acknowledge that your agreement to subscribe for the
number of Placing Shares comprised in your participation in the
Placing is not to be made pursuant to the Prospectus but is made
pursuant to these terms and conditions in this Appendix III;
3. you confirm that if you duly apply and subscribe (on the
terms set out in the Prospectus) for Open Offer Shares to which you
are entitled, such application and subscription shall extend to an
irrevocable undertaking to subscribe for such number of New
Ordinary Shares at the Issue Price following expiry of the Open
Offer in the event that, as a result of your default or otherwise,
you have failed to fulfil your obligation to apply and subscribe
for all those Open Offer Shares to which you are entitled;
4. the Ordinary Shares are admitted to trading on the main
market for listed securities of the London Stock Exchange, and that
the Company is therefore required to publish certain business and
financial information in accordance with the rules and practices of
the London Stock Exchange and/or the FCA and the Market Abuse
Regulation (EU Regulation No. 596/2014 as it forms part of United
Kingdom domestic law by virtue of EUWA (the "UK 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;
5. it has made its own assessment of the 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 Placing
and neither the Joint Bookrunners nor the Company nor any of their
respective Representatives nor 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 the Joint Bookrunners,
the Company, any of their respective Representatives or any person
acting on behalf of any of them to provide it with any such
information;
6. neither Joint Bookrunner nor any person acting on behalf of
it nor any of its Representatives 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;
7.
(a) the only information on which it is entitled to rely on and
on which it has relied in committing to acquire the Placing Shares
is contained in this Announcement and 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 the information in this
Announcement and the Publicly Available Information;
(b) neither Joint Bookrunner, nor the Company (nor any of their
respective Representatives) 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, nor will it provide
any material or information regarding the Company, the Placing or
the Placing Shares;
(c) it has conducted its own investigation of the Company, the
Placing (including its terms and conditions) 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
(d) it has not relied on any investigation that either Joint
Bookrunner or any person acting on its behalf may have conducted
with respect to the Company, the Placing or the Placing Shares;
8. 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 Joint Bookrunner nor
any persons acting on its 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 Placing based on any
information, representation, warranty or statement contained in
this Announcement, the Publicly Available Information or otherwise.
Nothing in this Appendix III shall exclude any liability of any
person for fraudulent misrepresentation;
9. neither it nor the beneficial owner of the Placing Shares is,
nor will, at the time the Placing Shares are acquired, either of
them be at resident of the United States, Australia, Canada, the
Republic of South Africa or Japan;
10. 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, 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;
11. it may be asked to disclose in writing or orally to the
Joint Bookrunners: (i) if he or she is an individual, his or her
nationality; or (ii) if he or she is a discretionary fund manager,
the jurisdiction in which the funds are managed or owned;
12. it has the funds available to pay for the 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 Placing Shares may be placed with other
Placees or sold at such price as the Joint Bookrunners
determine;
13. it and/or each person on whose behalf it is participating:
(a) is entitled to acquire Placing Shares pursuant to the
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 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 III) 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 Placing Shares;
14. it is not, and any person who it is acting on behalf of is
not, and at the time the Placing Shares are acquired will not be, a
resident of, or with an address in, or subject to the laws of, the
United States, Australia, Canada, the Republic of South Africa or
Japan, 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 the United States, Australia, Canada,
the Republic of South Africa or Japan and may not be offered, sold,
or acquired, directly or indirectly, within those
jurisdictions;
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 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;
17. 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;
18. it understands that:
(a) no representation is made as to the availability of the
exemption provided by Rule 144 of the Securities Act for resales or
transfers of Placing Shares; and
(b) it will not deposit the Placing Shares in an unrestricted
depositary receipt programme in the United States (as defined in
the Securities Act);
19. it will not offer, sell, transfer, pledge or otherwise
dispose of any 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;
20. 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 Placing Shares;
21. it understands that the 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 Placing Shares
may, 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.";
22. it is not taking up the Placing Shares as a result of any
"directed selling efforts" (as such term is defined in Regulation S
under the Securities Act);
23. it understands that there may be certain consequences under
United States and other tax laws resulting from an investment in
the 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;
24. 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;
25. none of the Joint Bookrunners, the Company nor any of their
respective Representatives 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 the
Joint Bookrunners 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 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;
26. it will make payment to the relevant Joint Bookrunner 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 the Joint Bookrunners
determine in their 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 Placing
Shares;
27. its allocation (if any) of Placing Shares will represent a
maximum number of 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 Placing Shares (if any), but in
no event in aggregate more than the aforementioned maximum;
28. 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 Placing Shares in the United States or in any
country or jurisdiction where any such action for that purpose is
required;
29. 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,
and that 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 Placing Shares pursuant to the Placing and agrees to
indemnify the Company and the Joint Bookrunners in respect of the
same on the basis that the 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;
30. 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;
31. if it is within the United Kingdom, it and any person acting
on its behalf (if within the United Kingdom) 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 Placing
Shares that are allocated to it for the purposes of its business
only;
32. it has not offered or sold and will not offer or sell any
Placing Shares to persons in the United Kingdom or a Relevant State
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 within the meaning of the UK
Prospectus Regulation, or an offer to the public in any member
state of the EEA within the meaning of the EU Prospectus
Regulation;
33. if it is within the United Kingdom, it is a Qualified
Investor as defined in Article 2(e) of the UK Prospectus Regulation
and if it is within a Relevant State, it is a Qualified Investor as
defined in Article 2(e) of the EU Prospectus Regulation;
34. 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 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;
35. 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 the FSMA
and the UK MAR in respect of anything done in, from or otherwise
involving the United Kingdom);
36. if it is a financial intermediary, as that term is used in
Article 5(1) of the UK Prospectus Regulation, 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 the United
Kingdom other than Qualified Investors, or in circumstances in
which the express prior written consent of Panmure Gordon has been
given to each proposed offer or resale;
37. if it has received any inside information (for the purposes
of the UK MAR and section 56 of the Criminal Justice Act 1993 or
other applicable law) about the Company in advance of the Placing,
it has not:
(a) dealt (or attempted to deal) in the securities of the
Company or cancelled or amended a dealing in the securities of the
Company;
(b) encouraged, recommended or induced another person to deal in
the securities of the Company or to cancel or amend an order
concerning the Company's securities; or
(c) unlawfully disclosed such information to any person, prior
to the information being made publicly available;
38. if it is a person in the Dubai International Financial
Centre who acquires any Placing Shares pursuant to the Placing:
(a) it is it is a "Professional Client" as defined in the DIFC
Conduct of Business Module, other than natural persons; and
(b) it acknowledges that it is acquiring the Placing Shares in
the context of an offering that qualifies as a private placement
under DIFC law;
39. if it is a person in the Abu Dhabi Global Market who
acquires any Placing Shares pursuant to the Placing:
(a) it is it is a "Professional Client" as defined in the ADGM
Conduct of Business Rulebook, other than natural persons; and
(b) it acknowledges that it is acquiring the Placing Shares in
the context of an offering that qualifies as a private placement
under ADGM law;
40. if it is a person in the Kingdom of Saudi Arabia,
(a) it is it is a "Sophisticated Investor" as defined in the
Capital Market Law issued by Royal Decree No. M/30 dated 2/6/1424H
(as amended by Resolution of the Board of the Capital Market
Authority number 1-104-2019 dated 30 September 2019G); and
(b) it acknowledges that it is acquiring the Placing Shares in
the context of an offering that qualifies as a private placement
under the KSA rules;
41. Either Joint Bookrunner and its affiliates, 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, either Joint Bookrunner
and/or any of its 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;
42. it:
(a) has complied with its obligations in connection with money
laundering and terrorist financing under the Proceeds of Crime Act
2002 (as amended), the Terrorism Act 2000 (as amended), the
Terrorism Act 2006, the Money Laundering, Terrorist Financing and
Transfer of Funds (Information on the Payer) Regulations 2017 (as
amended) and all related or similar rules, regulations or
guidelines, issued, administered or enforced by any government
agency having jurisdiction in respect thereof and the Money
Laundering Sourcebook of the FCA (together, the "Money Laundering
Regulations");
(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 with the Money Laundering Regulations, 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 it may request from it
in connection with the 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 Placing
Shares that are to be acquired by it or at its direction pursuant
to the Placing being reduced to such number, or to nil, as the
Joint Bookrunners may decide at their sole discretion;
43. 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
Joint Bookrunners or the Company's registrars, as applicable, of
evidence of identity, definitive certificates in respect of the
Placing Shares may be retained at the Joint Bookrunners absolute
discretion or, where appropriate, delivery of the Placing Shares to
it in uncertificated form may be delayed at the Joint Bookrunners
or the Company's registrars', as the case may be, absolute
discretion. If within a reasonable time after a request for
verification of identity either 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 Joint Bookrunner
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;
44. it acknowledges that its commitment to acquire Placing
Shares on the terms set out in this Announcement and in the
contract note or through the electronic trade 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 the Joint Bookrunners'
conduct of the Placing;
45. it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of acquiring 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;
46. it irrevocably appoints any duly authorised officer of
either 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 Placing Shares for which it agrees to acquire upon
the terms of this Announcement;
47. the Company, the Joint Bookrunners and others (including
each of their respective Representatives) 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;
48. it is acting as principal only in respect of the Placing or,
if it is acquiring the Placing Shares as a fiduciary or agent for
one or more investor accounts, it:
(a) 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; and
(b) will remain liable to the Company and the Joint Bookrunners
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);
49. time is of the essence as regards its obligations under this Appendix III;
50. 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 the Joint Bookrunners;
51. the Placing Shares will be issued subject to the terms and
conditions of this Appendix III; and
52. the terms and conditions contained in this Appendix III and
all documents into which this Appendix III 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 Placing Shares pursuant to the Bookbuilding
Process and/or the Placing and all non-contractual or other
obligations arising out of or in connection with them, 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 (including any dispute regarding the existence, validity
or termination or such contract or relating to any non-contractual
or other obligation arising out of or in connection with such
contract), except that enforcement proceedings in respect of the
obligation to make payment for the 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 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
Representatives 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 III or incurred by the Joint
Bookrunners, the Company or each of their respective
Representatives arising from the performance of the Placee's
obligations as set out in this Announcement, and further agrees
that the provisions of this Appendix III shall survive after the
completion of the Placing.
The rights and remedies of the Joint Bookrunners and the Company
under these terms and conditions are in addition to any rights and
remedies which would otherwise be available to each of them and the
exercise or partial exercise or partial exercise of one will not
prevent the exercise of others.
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 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 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 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 III are given to each Joint
Bookrunner for itself and on behalf of the Company and are
irrevocable.
Panmure Gordon 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 Capital Raising and Panmure Gordon 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 Capital Raising or any
other matters referred to in this Announcement.
Each Placee and any person acting on behalf of the Placee
acknowledges that each Joint Bookrunner 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.
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
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 Panmure Gordon, any money held in an account with
Panmure Gordon 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 Panmure
Gordon'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 main
market for listed securities of 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.
APPIX IV - DEFINITIONS
"Admission" admission of the New
Ordinary Shares
to the premium
listing segment of
the Of cial List and
to trading
on the London Stock
Exchange's main
market for listed
securities
"Adjusted EBITDA" earnings before
interest, taxes
and amortisation,
less exceptional
items (non- nance)
and amortisation
"Announcement" the announcement of
the Capital
Raising released by
the Company
through a Regulatory
Information
Service on 9 June
2021
"Application Form" the personalised
application form
on which the
Qualifying Non-CREST
Shareholders may
apply for New
Ordinary
Shares under the Open
Offer
"Board" or "Board of Directors" the board of
directors of the
Company
"Capital Raising" the Placing and Open
Offer
"Capital Reorganisation" means the proposed
subdivision of
each Existing
Ordinary Share into
one Ordinary Share of
2 pence each
and one Deferred
Share of 8 pence
each
"Capital Reorganisation means 6.00 p.m. on 25
Record Date" June 2021,
being the date
specified in the
Expected Timetable of
Principal
Events on which those
Shareholders
holding Existing
Ordinary Shares
shall be subject to
the terms of
the Capital
Reorganisation
"certi cated" or "in certi a share or other
cated form" security which
is not in uncerti
cated form (that
is, not in CREST)
"Chairman" means the Chairman of
the Company
"City Code" The City Code on
Takeovers and Mergers
"Committed Shares" the 295,220,633 New
Ordinary Shares
subject to
irrevocable
undertakings
to take up the Open
Offer in full
"Company" or "GMS" Gulf Marine Services
PLC
"Conditional Placees" any person who has
agreed to
conditionally
subscribe for Open
Offer Shares
(subject to clawback
in respect
of valid applications
for Open Offer
Shares by Qualifying
Shareholders
under the Open Offer)
pursuant to
the placing
"CREST" the CREST system (as
de ned in the
CREST Regulations)
"CREST Regulations" means the
Uncertificated
Securities
Regulations 2001 (SI
2001 No. 01/378),
as amended
"Decree" the UAE Federal Law
N. 26 of 2020
amending certain
provisions of the
UAE Commercial
Companies Law
"Deferred Shares" the deferred shares
of 8 pence each
in the capital of the
Company which
will be created as a
result of the
Capital
Reorganisation
"Directors" the Executive
Directors and
Non-Executive
Directors of the
Company
"EEA" the European Economic
Area
"EEA State" a member state of the
EEA
"Enlarged Share Capital" the ordinary issued
share capital
of the Company
immediately following
completion of the
Capital Raising
"EOR" enhanced oil recovery
"EPC" engineering,
procurement and
construction
"EU" European Union
"EU Prospectus Regulation" Regulation (EU)
2017/1129 of the
European Parliament
and of the Council
of 14 June 2017
"Euroclear" Euroclear & Ireland
Limited
"EUWA" the European Union
(Withdrawal)
Act 2018, as amended
"Excess Application Facility" the facility for
Qualifying
Shareholders
to apply for
additional Open Offer
Shares in excess of
their Open Offer
Entitlements
"Excess Open Offer Entitlements" in respect of each
Qualifying
Shareholder
who has taken up his
or her Open
Offer Entitlement in
full, the entitlement
(in addition to the
Open Offer
Entitlement)
to apply for
additional Open Offer
Shares, up to the
number of New
Ordinary Shares,
pursuant to the
Excess Application
Facility. In
all circumstances,
excess applications
shall be allocated on
a pro rata
basis to Qualifying
Shareholders'
excess applications
"Ex-Entitlement Date" the date on which the
New Ordinary
Shares are expected
to commence
trading
ex-entitlement, being
8.00
a.m. on 9 June 2021
"Existing Ordinary Shares" the existing ordinary
shares of
10 pence each in the
capital of
the Company
immediately prior to
the Capital Raising
"Facilities" the Term Loan
Facilities and
Working
Capital Facility
"FCA" the Financial Conduct
Authority
acting in its
capacity as the
competent
authority for the
purposes of Part
VI of the FSMA
"First Equity Raise Condition" means, pursuant to
the Revised Debt
Terms, the
requirement that the
Company raises equity
capital of
U.S.$25 million
(after expenses)
or more by 30 June
2021 in order
to make the Interim
Prepayment
"First Tranche Warrants" means 43,810,974
warrants, being
approximately 50 per
cent. of the
Warrants
"Forward-looking Statements" forward-looking
statements,
forecasts,
estimates,
projections and
opinions
"FSMA" the Financial
Services and Markets
Act 2000, as amended
"General Meeting" means the general
meeting of the
Company to be held at
2.00 p.m.
(UAE time) on 25 June
2021
"Group" the Company and its
subsidiary
undertakings
and, where the
context requires,
its associated
undertakings
"HSE" "HSE" Health, Safety and
Environment
"IOCs" international oil
companies
"Interim Prepayment" the requirement for
the Group to
use at least U.S.$25
million of
net proceeds from the
Capital Raising
(which must occur
before close of
business on 30 June
2021), subject
to certain
conditions, to prepay
at least U.S.$25
million of its
Term Loan Facilities,
pursuant to
the 2021 Common Terms
Agreement
"ISIN" International
Securities Identi
cation Number
"Issue Price" means 3 pence per New
Ordinary Shares
"KSA" Kingdom of Saudi
Arabia
"Lenders" the banks (Abu Dhabi
Commercial
Bank, Abu Dhabi
Islamic Bank, First
Abu Dhabi Bank, HSBC,
National Bank
of Kuwait, Bank ABC)
identified
in the 2021 Common
Terms Agreement
as the providers of
the Facilities
"Latest Practicable Date" 8 June 2021, being
the latest
practicable
date prior to this
announcement
"LIBOR" the London interbank
offer rate
"Listing Rules" the listing rules of
the FCA
"London Stock Exchange" London Stock Exchange
plc
"Main Market" the London Stock
Exchange's main
market for listed
securities
"Mazrui" Mazrui Investments
LLC
"MENA" Middle East and North
Africa
"MOU" Mobile Offshore Unit
"New Ordinary Shares" the new Ordinary
Shares which the
Company will allot
and issue pursuant
to the Placing and
Open Offer
"NOCs" national oil
companies
"Non-CREST Shareholders" Shareholders that
will not participate
in the Placing and
Open Offer through
CREST stock accounts
"Non-Executive Directors" the non-executive
directors of the
Company
"OEMs" original equipment
manufacturers
"Of cial List" the of cial list of
the FCA pursuant
to the FSMA
"Open Offer" the conditional
invitation to
Qualifying
Shareholders to
subscribe for the
Open Offer Shares at
the Issue Price
on the terms and
subject to the
conditions set out in
the Prospectus
and, in the case of
Qualifying Non-
CREST Shareholders
only, the Application
Form
"Open Offer Entitlements" entitlements to
subscribe for the
Open Offer Shares,
allocated to
a Qualifying
Shareholder pursuant
to the Open Offer
"Open Offer Shares" the 665,926,795 New
Ordinary Shares
to be issued pursuant
to the Placing
and Open Offer
"Order" means the Financial
Services and
Markets Act 2000
(Financial Promotion)
Order 2005
"Ordinary Shares" means the ordinary
shares of 10
pence each (and,
following the Capital
Reorganisation, 2
pence each) in
the capital of the
Company
"PIK" Payment-in-kind
"Placees" a Conditional Placee
"Placing" the conditional
placing of certain
of the Open Offer
Shares
"Placing Agreement" the placing agreement
dated 9 June
2021 and made between
the Company
and Panmure Gordon
"POB" people on board
"Prospectus" means the circular
and a prospectus
relating to the
Company for the
purpose of the
Capital Raising and
Admission
"Prospectus Regulation the prospectus
Rules" regulation rules
made by the FCA under
section 73A
of FSMA, as amended
from time to
time
"Qualified Investors" means a qualified
investor within
the meaning of
Article 2(e) of
Regulation
(EU) 2017/1129
"Qualifying CREST Shareholders" Qualifying
Shareholders holding
Ordinary Shares on
the register
of members of the
Company on the
Record Date which are
in uncertificated
form
52.1 " Qualifying
Qualifying Shareholders holding
Non-CREST Ordinary Shares on
Shareholders the register
" of members of the
Company on the
Record Date which are
in certi cated
form
"Qualifying Shareholders" Shareholders on the
register of
members of the
Company on the Record
Date with the
exclusion of persons
with a registered
address or located
or resident in an
Excluded Territory
"Record Date" 6.30 p.m. on 7 June
2021, being
the date specified in
the Expected
Timetable of
Principal Events on
which a Shareholder
must hold Ordinary
Shares to be a
Qualifying
Shareholder
"Regional Joint Bookrunner" Emirates NBD Capital
Limited
"Registrar", "Receiving Equiniti Limited,
Agent" or "Equiniti" whose registered
office is at Aspect
House, Spencer
Road, Lancing, West
Sussex BN99
6DA
"Regulation S" Regulation S under
the Securities
Act
"Regulatory Information any one of the
Service" regulatory
information
services authorised
by the FCA to
receive, process and
disseminate
regulatory
information from
listed
companies
"relevant persons" means Qualified
Investors and those
who fall within
Article 49(2)(a)
to (d) of the Order
"Resolutions" the Resolutions to be
proposed at
the General Meeting
"Revised Debt Terms" the negotiated debt
terms (including
in relation to the
Facilities) between
the Company and its
lenders on 31
March 2021 which are
principally
documented in the
2021 Common Terms
Agreement
"Seafox" Seafox International
Limited
"Second Equity Raise Condition" pursuant to the
Revised Debt Terms,
the requirement that
the Company
raises further equity
capital (in
addition to the First
Equity Raise
Condition), such that
the Company
has raised a total of
U.S.$75 million
or more (inclusive of
any amount
raised as part of the
First Equity
Raise Condition) by
31 December
2022 in order to make
the Minimum
Prepayment
"Securities Act" United States
Securities Act of
1933, as amended
"SESVs" self-elevating
support vessels
"Shareholders" holders of ordinary
shares in the
capital registered on
the register
of members of the
Company
"Sponsor" Panmure Gordon (UK)
Limited
"T/Cs" time charter
contracts
"Target Market Assessment" means the target
market assessment
under the UK MiFIR
Product Governance
Requirements
"Term Loan Facilities" the conventional and
Islamic term
credit facilities
made available
to the Group by the
Lenders in an
aggregate outstanding
amount of
U.S.$422.2 million as
at 1 April
2021
"UAE" United Arab Emirates
"UAE Commercial Companies the UAE Commercial
Law" Companies Law
No. 2 of 2015, as
amended
"UK Corporate Governance the UK Corporate
Code" Governance Code
issued by the
Financial Reporting
Council, as amended
from time to
time
"UK Market Abuse Regulation" the UK version of
Regulation (EU)
596/2014 on market
abuse and repealing
Directive 2003/6/EC
of the European
Parliament and of the
Council and
Commission Directives
2003/124/EC,
2003/125/EC and
2004/72/EC, which
is part of UK
domestic law by
virtue
of the EUWA
52.2 "UK means the product
MiFIR Product governance
Governance requirements
Requirements" under EUWA and the
FCA Handbook
Conduct of Business
Sourcebook
52.3 "UK the UK version of
Prospectus Regulation (EU)
Regulation" No 2017/1129 of the
European Parliament
and of the Council of
14 June 2017
on the prospectus to
be published
when securities are
offered to the
public or admitted to
trading on
a regulated market,
and repealing
Directive 2003/71/EC,
which is part
of UK domestic law by
virtue of
the EUWA
"uncerti cated" or "in recorded on the
uncerti cated form" register of members
as being held in
uncerti cated form
in CREST and title to
which, by
virtue of the CREST
Regulations,
may be transferred by
means of CREST
"United Kingdom" or "UK" the United Kingdom of
Great Britain
and Northern Ireland
"United States" or "US" the United States of
America, its
territories and
possessions, any
state of the United
States and the
District of Columbia
"Warrant Resolutions" together, the First
Resolution,
Fourth Resolution and
Fifth Resolution
to be proposed at the
General Meeting
"Warrant Shares" the Ordinary Shares
issued on exercise
of the Warrants
"Warrants" 87,621,947 warrants
issued, or to
be issued, by the
Company to the
Lenders over an
aggregate of
87,621,947
Ordinary Shares,
being 20 per cent.
of the entire issued
share capital
of the Company at the
Latest Practicable
Date (subject to such
Adjustment
as may be required
from time to
time to ensure that
the Lenders
hold 20 per cent. of
the Ordinary
Shares of the Company
then in issue,
on a fully diluted
basis)
"Working Capital Facility" the conventional and
Islamic U.S.$50
million working
capital facility
made available to the
Group by certain
of the Lenders,
consisting of a
bonding/guarantee
facility with
a cash sub-limit of
U.S.$25 million
APPIX V -- KEY RISKS
The Capital Raising and any investment in the Ordinary Shares
are subject to a number of risks.
The following is not an exhaustive list or explanation of all
risks which investors may face when making an investment in the
Ordinary Shares and should be used as guidance only.
Risks relating to the Group's capital structure and debt
facilities
-- The Group could face insolvency if the Resolutions are not passed, the Capital Raising does not proceed or the
First Equity Raise Condition is not satisfied
-- The Company could face an event of default under the Facilities if the Warrant Resolutions are not passed, to
allow the Company to issue the Warrant Shares to the Lenders on exercise of the Warrants
-- If the Capital Raising does not proceed and the First Equity Raise Condition is not met, the Company will be
obliged to issue the Warrants
-- The Revised Debt Terms requires the Company to raise additional equity finance
-- If the Capital Raising proceeds and the First Equity Raise Condition is satisfied, the Company would be required
to issue Warrants if the Second Equity Raise Condition is not satisfied
-- The Group currently has, and will continue to have, significant outstanding debt obligations
-- The Group may not be able to implement an appropriate capital structure and achieve its strategic objectives
Risks relating to the Group's business operations
-- The Group's future business performance depends on its ability to secure new contracts for its SESVs and on the
exercise by its customers of their extension options on existing contracts, which could be significantly impacted
by the state of the global oil and gas market, as well as the COVID-19 pandemic
-- The Group is dependent upon its relationships with a small number of customers
-- The Group faces competition from other service providers, and increased competition in periods of low oil prices
may adversely impact its contract terms
-- Demand for the Group's SESVs in the oil and gas and renewable energy sectors is primarily linked to the level of
operating and maintenance expenditure or capital expenditure in the oil and gas sector and level of construction
and maintenance activities in the renewable energy sector
-- The Group's ability to recruit, retain and develop qualified personnel is critical to its success and growth
-- The Group's backlog may not ultimately be realised
-- Some of the Group's SESV contracts may be terminated early by its customers
-- The Group's interests in certain Group companies are subject to arrangements with local partners and the loss of
their support could have a material adverse effect on its business
-- The Group's operating and maintenance costs will not necessarily fluctuate in proportion to changes in operating
revenues
-- The Group's operations are subject to extensive health, safety and environmental regulations
-- The Group's business involves numerous operating hazards
-- The Group is dependent on its IT, financial, accounting and other data processing information systems to conduct
its business
Risks relating to the macro-economic and regulatory
environment
-- The Group is subject to the economic and political conditions of operating in the MENA region
-- The Group's business has been and will continue to be impacted by the COVID-19 pandemic
-- The UAE's key reforms to the UAE Commercial Companies Law is subject to further interpretation following the
expected promulgation of the list of activities with a strategic effect
-- The majority ownership interest of the Group's Abu Dhabi Operation is currently held through a nominee
arrangement, which conforms to established market practice in the UAE but does not comply with certain UAE
legislation
-- The Group is exposed to currency, foreign exchange and interest rate risks
-- The Group is exposed to risks relating to compliance with anti-bribery and anti-corruption regulations
-- The Group's insurance may not be adequate to cover its losses
-- Changes in tax laws or their application could have a material adverse effect on its business, financial
condition and results of operations
-- The Group is subject to uncertainty around the United Kingdom's departure from the European Union
Risks Relating to the Capital Raising and an investment in
Ordinary Shares
-- The Group has a substantial shareholder
-- The Group currently does not meet the 25 per cent. in "public hands" threshold
-- The market price of the New Ordinary Shares could be subject to volatility
-- The market price for the Ordinary Shares may decline below the Issue Price and Shareholders may not be able to
sell Ordinary Shares at a favourable price after the Capital Raising
-- Inability to exercise pre-emption rights on any issue of shares
-- Shareholders outside the United Kingdom may not be able to acquire New Ordinary Shares in the Open Offer
-- A significant sale of Ordinary Shares may adversely impact the market price of the Ordinary Shares
-- Investors in the New Ordinary Shares may be subject to exchange rate risk
-- It may not be possible to effect service of process upon the Company or the Directors or enforce court judgments
against the Company or the Directors
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END
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June 09, 2021 02:00 ET (06:00 GMT)
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