TIDMKIE
RNS Number : 5133Y
Kier Group PLC
13 May 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014 AS IT FORMS PART OF UK
DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT
2018.
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION,
DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER
JURISDICTION WHERE TO DO SO WOULD BREACH ANY APPLICABLE LAW OR
REGULATION. PLEASE SEE THE IMPORTANT NOTICE AT THE OF THIS
ANNOUNCEMENT.
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE A
PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. NEITHER THIS
ANNOUNCEMENT NOR ANYTHING CONTAINED HEREIN SHALL FORM THE BASIS OF,
OR BE RELIED UPON IN CONNECTION WITH, ANY OFFER OR COMMITMENT
WHATSOEVER IN ANY JURISDICTION. ANY DECISION TO PURCHASE, SUBSCRIBE
FOR, OTHERWISE ACQUIRE, SELL OR OTHERWISE DISPOSE OF ANY SECURITIES
REFERRED TO IN THIS ANNOUNCEMENT MUST BE MADE SOLELY ON THE BASIS
OF THE INFORMATION THAT IS CONTAINED IN THE PROSPECTUS TO BE
PUBLISHED BY THE COMPANY IN DUE COURSE.
KIER GROUP PLC
("Kier" or the "Company")
Proposed c.GBP241 million Capital Raise by way of a Firm Placing
and Placing and Open Offer of c.284 million New Ordinary Shares at
85 pence per share
Kier, a leading infrastructure services and construction group,
today announces that it proposes to raise gross proceeds of
approximately GBP241 million by way of a fully underwritten Firm
Placing and Placing and Open Offer and separate Directors'
Subscription (the "Capital Raise") of, in aggregate, 284,049,829
New Ordinary Shares at an issue price of 85 pence per New Ordinary
Share (the "Issue Price").
The Capital Raise, which together with the recent sale of Kier
Living Limited, will raise approximately GBP351.4 million of gross
proceeds for the Group. The proceeds will provide the Group with
the financial and operational flexibility to continue to deliver on
its strategic objectives within its chosen markets and will allow
it to further enhance and capitalise on its position as a strategic
partner to its customers.
The Firm Placing and Placing and Open Offer, which have been
fully underwritten by Numis Securities plc ("Numis") and Peel Hunt
LLP ("Peel Hunt"), are being conducted by way of an accelerated
bookbuild process (the "Bookbuild") which will be launched
immediately following this announcement (the "Announcement"). The
Firm Placing and Placing are subject to the terms and conditions
set out in the Appendix to this Announcement (which forms part of
this Announcement) (the "Appendix"). Numis and Peel Hunt are acting
as joint bookrunners and joint brokers to the Company in connection
with the Capital Raise (the "Joint Bookrunners"). Rothschild &
Co is acting as financial adviser and sponsor to the Company.
Key Capital Raise Highlights:
-- Intention to raise gross proceeds of approximately GBP241
million through a Firm Placing and Placing and Open Offer:
o GBP120.6 million to be raised through the Firm Placing through
the placing of 141,851,386 Firm Placing Shares; and
o GBP120.6 million to be raised through the Placing and Open
Offer through the placing of 141,851,386 Open Offer Shares.
-- In addition, certain Directors (or their closely associated
persons) are expected to subscribe for approximately GBP0.3 million
in aggregate of New Ordinary Shares at the Issue Price (the
"Director Subscriptions").
-- The Board believes that the Capital Raise will provide the
Group with the financial and operational flexibility to continue to
deliver on its strategic objectives. In particular, the Capital
Raise will:
o Create a strong, resilient and flexible balance sheet,
providing the Group with the capacity to invest; and provide its
clients, customers, suppliers and other stakeholders, with greater
confidence in Kier as a counterparty;
o Increase the financial headroom available to the Group,
allowing for more effective working capital management in the
current environment; and
o Facilitate the re-financing of the Group's existing borrowing
facilities.
-- The Group intends to use the net proceeds from the Capital
Raise to immediately reduce the Group's net debt and facilitate
prudent investment in the business to allow the Group to drive
sustainable, profitable organic growth. Use of proceeds will be
split as follows:
o GBP144.4 million will be used to prepay a portion of the
balance outstanding under the 2017 RCF Facility and associated fees
pursuant to the RCF Stage 3 Amendment;
o GBP43.5 million will be used to repay balances outstanding
under the Second Schuldschein Loan Agreement and the Fourth
Schuldschein Loan Agreement and associated fees pursuant to the 13
April 2021 amendments thereto;
o GBP16.5 million will be used to make payments to holders of
the 2012 Notes and 2014 Notes;
o GBP6.8 million will be used to pay other fees associated with
the Principal Debt Facilities Amendments;
o GBP 0.7 million will be used to pay an additional contribution
to the trustee of the Group's pension schemes; and
o the balance of GBP16.9 million will be retained within the
Group's cash reserves.
-- Following the completion of the Capital Raise, Kier's lenders
have agreed to extend the Group's debt facilities to January 2025,
providing the Group with additional balance sheet strength as it
pursues its target of a net cash position within 2-3 years.
-- The Issue Price represents a discount of 17.0 per cent. to
the closing price of 102.4 pence per Ordinary Share on 12 May 2021
(being the last Business Day prior to the publication of this
Announcement).The Capital Raise is conditional upon, among other
things, the approval of Kier Shareholders at a general meeting of
the Company which will take place at 10.00 a.m. on 16 June 2021
Kier Group Investment Highlights:
The Board believes Kier and the Capital Raise represent a
compelling investment opportunity:
-- Kier has made significant progress on its financial and
operational turnaround strategy, having simplified the Group's
portfolio, right sized its cost base, and embedded operational
improvements throughout.
-- Kier is now focussed on nation-wide markets in both
infrastructure and construction, which are defined by significant
and committed UK government and regulated industry spend over the
medium and long term.
-- Kier's position as a clear leader in its core markets is
underpinned by long-term contracts, and framework agreements,
creating high visibility of revenues and contract profitability. As
at 31 March 2021, Kier has an order book of GBP8 billion, which
covers 62 per cent. of year to 30 June 2022 forecast revenues and
has been awarded places on long-term frameworks worth up to GBP80
billion, across several sectors including, health, education and
justice.
-- Kier's scale, leading delivery capability at both national
and regional levels, operational delivery processes and expertise,
and balance sheet strength resulting from the Capital Raise, should
enable Kier to take maximum advantage of its leading market
positions.
-- Kier has successfully executed an ambitious self-help
programme and now has the appropriate cost base and "Performance
Excellence" culture embedded throughout the Group to ensure
contracts are won and executed on terms and values appropriate to
their risk. The Group expects to deliver at least GBP115 million of
annualised cost savings by the end of financial year 2021 (as
compared to financial year 2018) and continues to review its cost
base to identify additional cost saving measures.
-- Kier expects actions taken to right size the Group as part of
the turnaround strategy will result in continued improved financial
performance. The net proceeds from the Capital Raise will further
strengthen the Group's balance sheet, building on the sale of Kier
Living, and underpin Kier's medium-term value creation plan
targets:
o Revenue: GBP4.0 - 4.5 billion
o Adjusted operating margin: c.3.5 per cent.
o Cash conversion of operating profit: c.90 per cent.
o Balance sheet: Sustainable net cash position with capacity to
invest
o Dividend: Sustainable dividend policy with dividend cover of
around three times earnings through the cycle
Bookbuild:
The Firm Placing and Placing and Open Offer are fully
underwritten by the Joint Bookrunners on the terms and subject to
the conditions of the Underwriting Agreement, and are, along with
the Director Subscriptions, conditional upon, among other things,
the approval of Kier Shareholders at a general meeting of the
Company. Kier proposes to raise:
-- GBP120.6 million through a Firm Placing of 141,851,386 Firm
Placing Shares at the Issue Price. The Firm Placing will not be
subject to clawback to satisfy valid applications for Open Offer
Shares by Qualifying Shareholders in the Open Offer.
-- GBP120.6 million through a Placing and Open Offer of
141,851,386 Open Offer Shares at the Issue Price. The Open Offer
Shares will be subject to clawback to satisfy valid applications
for Open Offer Shares by Qualifying Shareholders in the Open
Offer.
-- The Open Offer Shares will be made available to Qualifying
Shareholders on the share register at the Record Date. Qualifying
Shareholders are being given the opportunity to subscribe for Open
Offer Shares pro rata to their holdings of Existing Ordinary Shares
on the basis of 7 Open Offer Shares for every 8 Existing Ordinary
Shares held by them and registered in their name at the Record
Date.
-- In addition, Qualifying Shareholders will be able to apply
for excess entitlements in the Open Offer of up to 1x their basic
entitlement, subject to Open Offer Shares being available to
satisfy such excess entitlements, to allow them to maintain their
pro-rata shareholding in Kier.
-- The Firm Placing Shares and Open Offer Shares, when issued,
will be fully paid and will rank pari passu in all respects with
the Existing Ordinary Shares.
The Bookbuild is expected to close no later than 12p.m. on 13
May 2021 , subject to acceleration. Timing of the closing of the
Bookbuild and allocations are at the discretion of the Joint
Bookrunners and the Company. Details of the results of the Capital
Raise will be announced as soon as practicable after the close of
the Bookbuild.
Your attention is drawn to the detailed terms and conditions of
the Firm Placing and Placing described in Appendix V to this
Announcement. Capitalised terms used but not otherwise defined in
the text of this Announcement are defined in Appendix III of this
Announcement.
Set out below in Appendix I to this Announcement is some further
information regarding the Company and the Capital Raise. The
Company intends to send to Shareholders and publish on its website
a shareholder Prospectus (the "Prospectus"), including the Notice
of General Meeting, shortly after the announcement of the results
of the Bookbuild this morning.
Andrew Davies, CEO, commented:
"Today's proposed capital raise represents the final milestone
in the Group's strategy to simplify the Group; to improve cash
generation; and to strengthen our balance sheet. This capital raise
will provide Kier with the financial and operational flexibility to
continue to pursue our strategic objectives, within our chosen
markets, and to facilitate investment in the business to help drive
sustainable, profitable organic growth and the achievement of our
medium-term financial targets"
For further information, please contact:
Kier Group plc
Investor Relations +44 (0) 7933 388 746
Kier Press office +44 (0) 1767 355 096
============================================== =======================
Rothschild & Co
Financial Adviser and Sponsor
John Deans, Neil Thwaites, Shannon Nicholls +44 (0) 20 7280 5000
============================================== =======================
Numis Securities
Joint Bookrunner and Joint Broker
Jonathan Wilcox, Richard Thomas, Jamie
Loughborough, Howard Seymour, Hannah
Boros +44 (0) 20 7260 1000
============================================== =======================
Peel Hunt
Joint Bookrunner and Joint Broker
Harry Nicholas, Charles Batten, Sam
Cann, John Welch, Alastair Rae (Syndicate) +44 (0) 20 7418 8900
============================================== =======================
FTI Consulting:
Richard Mountain, Nick Hasell +44 (0) 20 3727 1340
============================================== =======================
Gleacher Shacklock LLP
Debt Adviser
Michael Grayer, Tom Quinn, Christopher
Lloyd-Davies +44 (0) 20 7484 1150
============================================== =======================
Key dates for the Firm Placing and Placing and Open Offer
Record Date for entitlements under the 5.00 p.m. on 12 May
Open Offer 2021
Publication of the Prospectus, the Notice 13 May 2021
of General Meeting and the Form of Proxy
Ex-Entitlement Date for the Open Offer 8.00 a.m. on 14 May
2021
Posting of the Prospectus, Application 17 May 2021
Forms (to Qualifying Non-CREST Shareholders
only) and Forms of Proxy
Open Offer Entitlements and Excess Open as soon as practicable
Offer Entitlements credited to stock accounts after 8.00 a.m. on
in CREST (Qualifying CREST Shareholders 18 May 2021
only)
Latest time and date for receipt of Forms 10.00 a.m. on 14
of Proxy June 2021
Latest time and date for receipt of completed 11.00 a.m. on 14
Application Forms and payments in full June 2021
and settlement of CREST instructions (as
appropriate)
Announcement of the results of the Open 15 June 2021
Offer
General Meeting 10.00 a.m. on 16
June 2021
Admission and dealings in New Ordinary 8.00 a.m. on 18 June
Shares to commence on the London Stock 2021
Exchange
Market Abuse Regulation
This Announcement contains inside information for the purposes
of EU MAR and UK MAR (together, "MAR"). In addition, market
soundings (as defined in MAR) were taken in respect of the matters
contained in this Announcement, with the result that certain
persons became aware of such inside information as permitted by
MAR. That inside information is set out in this Announcement and
has been disclosed as soon as possible in accordance with paragraph
7 of article 17 of both EU MAR and UK MAR. Upon the publication of
this Announcement, the inside information is now considered to be
in the public domain and such persons shall therefore cease to be
in possession of inside information in relation to the Company and
its securities.
The person who arranged the release of this Announcement on
behalf of Kier was Phil Higgins, Company Secretary.
IMPORTANT NOTICES
Important notices
This Announcement may contain certain forward-looking
statements, beliefs or opinions, with respect to the financial
condition, results of operations and business of the Company and
the Group. This Announcement includes statements that are, or may
be deemed to be, "forward-looking statements". The words "believe,"
"estimate," "target," "anticipate," "expect," "could," "would,"
"intend," "aim," "plan," "predict," "continue," "assume,"
"positioned," "may," "will," "should," "shall," "risk", their
negatives and other similar expressions that are predictions of or
indicate future events and future trends identify forward-looking
statements. Forward-looking statements in this Announcement
include, but are not limited to, statements about: the conditions
to the Capital Raise becoming effective being met, and the current
development and aftermath of the COVID-19 pandemic. An investor
should not place undue reliance on forward-looking statements
because they involve known and unknown risks, uncertainties and
other factors that are in many cases beyond the control of the
Company or the Group. By their nature, forward-looking statements
involve risks and uncertainties because they relate to events and
depend on circumstances that may or may not occur in the future.
The Company cautions investors that forward-looking statements are
not guarantees of future performance and that its actual results of
operations and financial condition, and the development of the
industry in which it operates, may differ materially from those
made in or suggested by the forward-looking statements contained in
this Announcement and/or information incorporated by reference into
this Announcement. In addition, even if the Company's or the
Group's results of operation, financial position and growth, and
the development of the markets and the industry in which the Group
operates, are consistent with the forward-looking statements
contained in this Announcement, these results or developments may
not be indicative of results or developments in subsequent periods.
The cautionary statements set forth above should be considered in
connection with any subsequent written or oral forward-looking
statements that the Company, or persons acting on its behalf, may
issue.
N.M. Rothschild & Sons Limited ("Rothschild & Co"),
Numis Securities Limited and Peel Hunt LLP, which are each
authorised and regulated in the UK by the FCA, are each acting
exclusively for the Company and no one else in connection with the
contents of this Announcement, the Capital Raise and any other
matters referred to in this Announcement and will not regard any
other person as a client in relation to the Capital Raise or any
other matters referred to in this Announcement and will not be
responsible to anyone for providing the protections afforded to
their clients nor for giving advice to any other person in relation
to the contents of this Announcement, the Capital Raise or any
other matter or arrangement referred to in this Announcement.
Neither Rothschild & Co nor the Joint Bookrunners are
responsible for the contents of this Announcement.
Past performance of the Company cannot be relied on as a guide
to future performance. A variety of factors may cause the Company's
or the Group's actual results to differ materially from the
forward-looking statements contained in this Announcement. The
Group, Rothschild & Co and the Joint Bookrunners and each of
their respective directors, officers, employees, agents, affiliates
and advisers expressly disclaim any obligation to supplement,
amend, update or revise any of the forward-looking statements made
herein, except where required to do so under applicable law.
No statement in this Announcement is intended as a profit
forecast, project, prediction 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 has been issued by and is the sole
responsibility of the Company. No representation or warranty,
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by
Rothschild & Co, either Joint Bookrunner or by any of their
respective affiliates, directors, employees, advisers or agents as
to, or in relation to, the accuracy or completeness of this
Announcement or any other written or oral information made
available to any interested party or its advisers, and any
liability therefore is expressly disclaimed.
No reliance may or should be placed by any person for any
purpose whatsoever on the information contained in this
Announcement or on its accuracy or completeness. The information in
this Announcement is subject to change.
This Announcement, including the appendices, is for information
purposes only and is not intended to and does not constitute or
form part of any offer or invitation to sell, allot or issue, or
any offer or invitation to purchase or subscribe for, or any
solicitation to purchase or subscribe for, any securities in the
United States (including its territories and possessions),
Australia, its territories and possessions, Canada, Japan, South
Africa or in any jurisdiction to whom or in which such offer or
invitation is unlawful, nor does the fact of its distribution form
the basis of, or be relied upon in connection with, or act as any
inducement to enter into, any contract or commitment whatsoever
with respect to such securities, the Company or otherwise.
Neither this Announcement nor any copy of it nor the information
contained in it and any related materials is for publication,
distribution or release, in whole or in part, directly or
indirectly, in or into or from the United States (including its
territories and possessions, any State of the United States and the
District of Columbia) (subject to certain restrictions), Australia,
its territories and possessions, Canada, Japan, South Africa, or
any other jurisdiction where to do so would constitute a violation
of the relevant laws of such jurisdiction.
The distribution of this Announcement and the offering of the
New Ordinary Shares may be restricted by law in certain
jurisdictions.
No action has been taken by the Company, Rothschild & Co,
the Joint Bookrunners or any of their respective affiliates 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 should inform
themselves about and observe any such restrictions. Any failure to
comply with these restrictions may constitute a violation of the
securities laws of any such jurisdiction.
The New Ordinary Shares have not been and will not be registered
under the U.S. Securities Act of 1933, as amended (the "Securities
Act"), or under any securities laws of any state or other
jurisdiction of the United States. The New Ordinary Shares may not
be offered, sold, taken up, exercised, resold, transferred or
delivered, directly or indirectly, into or within 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. There will be no public
offer of the New Ordinary Shares in the United States. The New
Ordinary Shares are being offered: (i) outside the United States in
"offshore transactions" as defined in, and in accordance with,
Regulation S under the Securities Act; and (ii) in the United
States to persons reasonably believed to be "qualified
institutional buyers", as defined in Rule 144A under the Securities
Act ("QIBs") who are subscribing for the New Ordinary Shares in
private placement transactions pursuant to Section 4(a)(2) of the
Securities Act; or (iii) pursuant to another 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.
Prospective purchasers are notified that the Company as issuer of
the New Ordinary Shares is relying upon an exemption from the
registration requirements of Section 5 of the Securities Act.
In addition, until 40 days after the commencement of the
offering of the New Ordinary Shares, an offer, sale or transfer of
the New Ordinary Shares within the United States by any dealer
(whether or not participating in the Capital Raise) may violate the
registration requirements of the Securities Act.
The New Ordinary Shares have not been approved or disapproved by
the U.S. Securities and Exchange Commission, or state securities
commission in the United States or any other regulatory authority
in the United States, nor have any of the foregoing authorities
passed upon or endorsed the merits of the Capital Raise or the
accuracy or adequacy of these terms and conditions. Any
representation to the contrary is a criminal offence in the United
States.
Subject to certain exceptions, this Announcement does not
constitute an offer of the New Ordinary Shares to any person with a
registered address, or who is resident or located in the United
States or any of the Excluded Territories. The New Ordinary Shares
have not been and will not be registered under the relevant laws of
any state, province or territory of the United States or any of the
Excluded Territories and may not be offered, sold, resold, taken
up, transferred, delivered or distributed, directly or indirectly
within the United States or any Excluded Territory except pursuant
to an applicable exemption from registration requirements.
This Announcement does not constitute a recommendation
concerning any investor's options with respect to the Capital
Raise. 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. The contents of this
Announcement are not to be construed as legal, business, financial
or tax advice. Each investor or prospective investor should consult
his, her or its own legal adviser, business adviser, financial
adviser or tax adviser for legal, financial, business or tax
advice.
The New Ordinary Shares to be issued or sold pursuant to the
Capital Raise will not be admitted to trading on any stock exchange
other than the London Stock Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
UK Product Governance Requirements
Solely for the purposes of the product governance requirements
contained within the FCA Handbook Product Intervention and Product
Governance Sourcebook (the "UK Product Governance Rules"), and
disclaiming all and any liability, whether arising in tort,
contract or otherwise, which any 'manufacturer' (for the purposes
of the UK Product Governance Rules) may otherwise have with respect
thereto, the New Ordinary Shares have been subject to a product
approval process, which has determined that such New Ordinary
Shares are: (a) compatible with an end target market of retail
investors and investors who meet the criteria of professional
clients and eligible counterparties, each as defined in Chapter 3
of the FCA Handbook Conduct of Business Sourcebook ("COBS"); and
(b) eligible for distribution through all permitted distribution
channels (the "UK target market assessment"). Notwithstanding the
UK target market assessment, distributors should note that: the
price of the New Ordinary Shares may decline and investors could
lose all or part of their investment; the New Ordinary Shares offer
no guaranteed income and no capital protection; and 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 UK target market assessment
is without prejudice to the requirements of any contractual, legal
or regulatory selling restrictions in relation to the Capital
Raise. Furthermore, it is noted that, notwithstanding the UK target
market assessment, the Joint Bookrunners will only procure
investors who meet the criteria of professional clients and
eligible counterparties. For the avoidance of doubt, the UK target
market assessment does not constitute: (a) an assessment of
suitability or appropriateness for the purposes of COBS 9A and COBS
10A, respectively; 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 UK target market
assessment in respect of the New Ordinary Shares and determining
appropriate distribution channels.
EU Product Governance Requirements
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended (MiFID II); (b) Articles 9 and 10
of Commission Delegated Directive (EU) 2017/593 supplementing MiFID
II; and (c) local implementing measures (together, the "MiFID II
Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the New Ordinary Shares to be issued in the Capital Raise have been
subject to a product approval process, which has determined that
the New Ordinary Shares are: (i) compatible with an end target
market of retail investors and investors who meet the criteria of
professional clients and eligible counterparties, each as defined
in MiFID II; and (ii) eligible for distribution through all
distribution channels as are permitted by MiFID II (the Target
Market Assessment). Notwithstanding the Target Market Assessment,
distributors should note that: the price of the New Ordinary Shares
may decline and investors could lose all or part of their
investment; the New Ordinary Shares to be issued in the Capital
Raise provide no guaranteed income and no capital protection; and
an investment in the New Ordinary Shares to be issued in the
Capital Raise 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 Capital Raise.
Furthermore, it is noted that, notwithstanding the Target Market
Assessment, the Joint Bookrunners will only procure investors who
meet the criteria of professional clients and eligible
counterparties.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take
any other action whatsoever with respect to, the 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.
Unless the context otherwise requires, all references to time
are to London time.
APPIX I
FURTHER INFORMATION REGARDING THE COMPANY AND THE PROPOSED
CAPITAL RAISE
Kier Group PLC
Firm Placing of 141,851,386 Firm Placing Shares at 85 pence
each
Placing and Open Offer of 141,851,386 Open Offer Shares at 85
pence each
Notice of General Meeting
PROPOSED FIRM PLACING AND PLACING AND OPEN OFFER
1. Introduction
Kier has today announced a proposed fully underwritten Firm
Placing and Placing and Open Offer, which, together with the
Director Subscriptions, will raise gross proceeds of GBP 24 1
million (the "Capital Raise"). The Firm Placing and Placing and
Open Offer will be fully underwritten by the Joint Bookrunners,
subject to the conditions set out in the Underwriting
Agreement.
Kier has made significant progress on the implementation of the
conclusions of the strategic review undertaken by the Chief
Executive, Andrew Davies, and announced in June 2019; to simplify
and focus the Group, improve the Company's cash generation and
strengthen its balance sheet. Kier is now focused on its strong,
core, cash generating businesses in Infrastructure Services and
Construction, where it has market leading positions. In addition,
Property has recently been categorised as a core business due to
the operational synergies it achieves with other Group businesses.
Kier is a national strategic partner in sectors based around long
term frameworks with the UK government and other regulated industry
clients.
The Board believes that the Capital Raise, which together with
the recent sale of Kier Living will raise GBP351.4 million of gross
proceeds for the Group, and the conditional extension of the
Group's 2017 RCF Facility to 31 January 2025 will provide the Group
with the financial and operational flexibility to continue to
pursue its strategic objectives within its chosen markets and will
allow it to further enhance and capitalise on its position as a
strategic partner to its customers.
Shareholders should note that the extension of certain of the
Group's Principal Debt Facilities, including the Group's 2017 RCF
Facility, which matures on 30 September 2022, is subject to receipt
of the net proceeds from the Capital Raise. See "Risk Factors-Risks
relating to the Group's debt" within the Prospectus.
The Capital Raise is conditional on, among other things, the
passing of the Resolutions by Shareholders at a General Meeting.
The General Meeting will take place at 10.00 a.m. on 16 June 2021
at the Tungsten Building, Central Boulevard, Blythe Valley Park,
Solihull B90 8AU. You will find a Notice of General Meeting set out
in the Prospectus.
The Board unanimously recommends that Shareholders vote in
favour of the Resolutions to be proposed at the General Meeting.
Each of the Directors who is a Shareholder intends to vote in
favour of the resolutions to be proposed at the General Meeting. In
addition, certain Directors intend to participate in the Capital
Raise and subscribe for the Subscription Shares.
2. Kier represents a compelling investment opportunity
The Board believes Kier and the Capital Raise represent a
compelling investment opportunity :
-- Kier is now focussed on nation-wide markets in both
infrastructure and construction, which are defined by significant
and committed UK government and regulated industry spend over the
medium and long term;
-- Kier's position as a clear leader in its core markets is
underpinned by long-term contracts, and framework agreements,
creating high visibility of revenues and contract profitability. As
at 31 December 2020, Kier has an order book of GBP8billion, which
covers 62 per cent. of year to 30 June 2022 forecast revenues, and
has been awarded places on long-term frameworks worth up to GBP80
billion, across a number of sectors including, health, education
and justice, providing it with long-term revenue streams, an
established operating platform and strengthened customer
relationships;
-- Kier's scale, leading delivery capability at both national
and regional levels, operational delivery processes and expertise,
and balance sheet strength resulting from the Capital Raise, should
enable Kier to take maximum advantage of its leading market
positions;
-- Kier has successfully executed an ambitious self-help
programme and now has the appropriate cost base and "Performance
Excellence" culture embedded throughout the Group to ensure
contracts are won and executed on terms and values appropriate to
their risk. The Group expects to deliver at least GBP115 million of
annualised cost savings by the end of the financial year ending 30
June 2021 (as compared to the financial year ended 30 June 2018),
and continues to review its cost base to identify additional cost
saving measures;
-- Kier expects actions taken to right size the Group as part of
the turnaround strategy will result in continued improved financial
performance and expects that over the medium term the Group will be
capable of the following medium-term targets:
c.GBP4.0 - 4.5 billion
* Organic annual revenue
c.3.5 per cent.
* Adjusted operating margin
c.90 per cent.
* Cash conversion of operating profit
Sustainable net cash position
* Balance sheet with capacity to invest
Sustainable dividend policy
* Dividend with dividend cover of around
three times earnings through
the cycle
Kier has the senior leadership team with the expertise and track
record to deliver this value creation plan.
3. Background to, and Reasons for, the Capital Raise
3.1. Introduction to Kier - a leading UK infrastructure services
and construction company
Kier is a leading UK infrastructure services and construction
company with approximately 100 years of experience. Kier is focused
on areas which are aligned to the UK government's investment
priorities and critical to the economic recovery of the UK.
Kier is a strategic partner to the UK government and regulated
industry clients, providing a "one-stop-shop" to clients from
design, project management, complex engineering solutions,
logistical issues, management of supply-chain as well as after
care.
Kier operates across the UK in attractive and growing sectors
which are increasingly defined by long term, committed spend,
including health, education, prisons, defence, transport, energy,
power, telecoms and water.
Under Kier's previous management, the Company undertook an
acquisition-led growth strategy, which included the acquisitions of
May Gurney, Mouchel and McNicholas in the four years to 2017.
Whilst these transactions built on and added to Kier's leading
positions in a number of attractive markets, they also left the
business with a lack of strategic and operational focus, a complex
and large cost base, and an over-leveraged balance sheet.
During 2019, Kier's management team was significantly
strengthened, with the appointment of Andrew Davies as Chief
Executive and Simon Kesterton as Chief Financial Officer, bringing
directly relevant strategic and operational expertise, combined
with broad and demonstrated experience in cost reduction and
balance sheet strengthening. Kier put in place an executive
committee comprising the Chief Executive and Chief Financial
Officer alongside the five Group Managing Directors, the Group
Commercial Director and the Group HR Director to oversee more
effectively strategic progress and operating activities.
In June 2019, Kier announced the results of a comprehensive
strategic review led by Andrew Davies, which was focused on
simplifying the Group, better allocating capital resources across
the Group, improving cash generation and reducing balance sheet
leverage.
This strategic review concluded that Kier would focus on its
core businesses: Highways, Infrastructure, Utilities and
Construction. These businesses are high-quality, have national,
market-leading positions and are underpinned by long-term
contracts, a total order book of GBP8 billion as at 31 December
2020, and positions on GBP80 billion of frameworks for the UK
government and regulated clients. Kier's strong order book is
underpinned by contract wins and de-risked contracts, and 51 per
cent. of the order book is under target cost or cost reimbursable
contracts. The increased order book, coupled with shift towards
lower risk contracts, provides clear visibility over medium term
targets. In addition, Kier has categorised its Property business as
core due to the potential for operational synergies with Kier's
other businesses.
Kier has made significant progress on its financial and
operational turnaround strategy. In particular, Kier has:
-- Simplified the Group's portfolio: reducing or exiting those
activities identified in the strategic review as non-core:
o Living - the sale of Kier Living for GBP110 million was
announced on 16 April 2021;
o Facilities Management - certain contracts have been
successfully concluded and the remaining business appropriately
rationalised;
o Environmental Services - the business has been substantially
exited.
-- Right-sized cost base: fundamentally restructured the Group
to deliver annualised cost savings of at least GBP115 million by
June 2021 (as compared to the financial year ended 30 June 2018),
and Kier continues to review its cost base to identify additional
cost saving measures.
-- Operational improvement: embedded a culture of "Performance
Excellence" throughout the Group and introduced a new operating
framework focused on people, processes, projects and costs,
underpinned by a "Back to basics" approach, resulting in the
delivery of high-quality projects on time and to budget
consistently across the Group.
As a result, the Board believes Kier is now strongly positioned
in its significant and growing markets, and the Capital Raise will
allow Kier to take maximum advantage of these market
opportunities.
3.2. Kier's market opportunities
In the National Infrastructure Strategy, published in November
2020 the UK government has committed to address the historical
under-investment in critical infrastructure by investing over
GBP600 billion over the next five years, focusing on roads,
railways, communications, schools, hospitals and power
networks.
The National Infrastructure Strategy contained the following
commitments in Kier's focus markets:
-- Over GBP27 billion to be invested in England's strategic roads between 2020 and 2025;
-- Funding for the Shared Rural Network to improve mobile
coverage in rural areas, and a GBP5 billion investment in gigabit
broadband rollout;
-- The School Rebuilding Programme, committing to a 10-year pipeline of 50 schools a year;
-- A new GBP4 billion cross-departmental "Levelling Up" Fund
that will invest in local infrastructure in England; and
-- Setting up a new UK infrastructure bank to co-invest
alongside the private sector in infrastructure projects.
In light of COVID-19, the UK government committed on 30 June
2020 to accelerate GBP5 billion of capital investment projects,
including:
-- GBP1.5 billion for building and maintaining hospitals;
-- Over GBP1 billion for the first 50 projects of a new,
ten-year school rebuilding programme, with construction on the
first sites anticipated from September 2021, and GBP560 million and
GBP200 million for repairs and upgrades to schools and further
education colleges, respectively;
-- GBP142 million for digital upgrades and maintenance to around
100 courts in 2020, GBP83 million for maintenance of prisons and
youth offender facilities and GBP60 million for temporary prison
places;
-- GBP100 million for 29 projects to improve the United Kingdom's road network;
-- GBP900 million for local areas to invest in priority
infrastructure projects in England, ranging from development and
regeneration of key local sites to investment to improve transport
and digital connectivity; and
-- GBP96 million to accelerate investment in town centres and high streets.
Infrastructure investment is fundamental to delivering net zero
emissions by 2050, a target set out in the Prime Minister's Ten
Point Plan for a Green Industrial Revolution, and which should
create very significant, long term opportunities for Kier. Key
measures set out in the National Infrastructure Strategy
include:
-- Significant investment in offshore wind and into modern ports
and manufacturing infrastructure to expand the share of energy
generation from renewables;
-- Providing up to GBP525 million to bring forward large-scale
nuclear and invest in the development of advanced nuclear
technologies;
-- GBP1 billion to support the establishment of carbon capture
and storage in four industrial clusters; and
-- Investing GBP1.3 billion in charging infrastructure to
accelerate the mass adoption of electric vehicles ahead of ending
the sale of new petrol and diesel cars by 2030.
Beyond the UK government's commitments, Kier is well placed to
benefit from an estimated GBP125 billion spend on rail investment,
approximately GBP7 billion investment to increase airport capacity,
water companies pledging to spend more than GBP50 billion in AMP7
over the next five years and an estimated GBP138 billion in new UK
energy infrastructure by 2028.
3.3. Kier's simplified and focused portfolio
As a result of actions taken by the new management team, Kier is
now a highly-focused Group with the following attractive business
units within its Infrastructure Services and Construction
segments:
Infrastructure Services (42 per cent. of Group revenue for the
six months ended 31 December 2020 and 44 per cent. of Group revenue
for the financial year ended 30 June 2020):
-- Highways : Kier's Highways business delivers emergency
response services and reactive maintenance, planned recurring
maintenance and enhancements to critical UK infrastructure. Kier
believes it has a leading position in strategic highways and top 3
in local highways, with over two-thirds of revenues undertaken on a
low commercial risk cost-reimbursable basis. The Highways team
includes designers, environmentalists, ecologists, traffic
engineers and safety engineers. The business has the technical
expertise, network knowledge and skills to develop, design and
manage the delivery of highways maintenance and improvement schemes
across the UK:
o The business is the largest highway services provider in the
UK, working with Highways England and a wide range of local
authorities who are collectively responsible for the UK's road
network;
o Core capabilities of the Highways business include:
-- Managing, maintaining and improving more than 30,000
kilometres of local authority and strategic roads (for example,
maintaining the spaghetti junction in the West Midlands, which
carries over 200,000 vehicles each day);
-- Managing and maintaining tunnels;
-- Analysing network needs, designing, developing and
implementing road schemes (for example, the 50/50 joint venture
between Kier and Tarmac recently secured a position on all three of
Transport for London's frameworks to deliver and support the
construction, renewal and enhancement of highways infrastructure
across London);
-- Preparing technical designs and undertaking supporting work
for capital projects, through a team of 520 designers. Design
support ranging from initial scheme feasibility to as-build
phases.
o In addition, Kier is typically delivering over GBP1 billion of
capital programmes at any one time. Current live major regional
capital projects include, but are not limited to:
-- M6 Smart Motorway in Staffordshire (GBP265 million contract
value);
-- A585 Windy Harbour Bypass in Lancashire (GBP140 million
contract value); and
-- Port of Liverpool in Merseyside (GBP195 million contract
value).
-- Infrastructure : Kier's Infrastructure business provides a
range of services to the UK government and public sector including
emergency response for flood relief victims across the nation,
providing innovative solutions in the energy production and defence
sectors or performing a critical role in the delivery of the UK's
largest and most complex infrastructure schemes. Kier's
Infrastructure business is characterised by repeat business
relationships typically exceeding 10 years for customers in its
chosen sectors, and 81 per cent. of contracts on a
reimbursable-costs basis. Core capabilities of the Infrastructure
business include:
o Project management: Kier has more than 150 qualified civil
engineering project leads with extensive project management
experience. Kier has significant experience as a "systems
integrator", which is increasingly required on complex projects,
such as Crossrail and HS2;
o Design management: Kier has 75 structural and civil
engineering designers providing technical advice and support across
offices in Manchester, Leeds, Liverpool, Birmingham, Norwich and
Bristol;
o Procurement and cost control: Kier has more than 120 qualified
commercial and procurement staff, providing control of projects and
contracts from inception to completion, cost certainty and value
add to customers;
o Quality management: Kier has a dedicated team of 17 people
whose primary role is to ensure quality assurance;
o Major infrastructure schemes include:
-- Hinkley Point C - Kier is delivering earthworks, site
preparation and infrastructure for the new nuclear power station
adjacent to the Somerset coast;
-- Crossrail - Kier has worked on five major contracts as part
of the overall GBP15 billion Crossrail project, including
constructing two railway tunnels that run for 6.4 kilometres
between the Royal Oak portal and the new Farringdon Crossrail
station in London, and large scale building of station tunnel
caverns at Bond Street, Tottenham Court Road and Farringdon ;
-- HS2 - Kier is a key partner on the largest section of the
scheme (80 kilometre central section) using its earthwork
expertise. Kier provides the majority of the project management and
engineering for the section.
-- Utilities : Kier's Utilities business enables consumers,
businesses and public bodies to remain connected to essential
water, energy, telecoms and rail networks. Through its Utilities
business, Kier believes it is a top 3 contractor in the water and
energy sectors, deriving over 90 per cent. of revenues from
long-term contracts and alliances, with the majority of contracts
on a cost-reimbursable basis. Utilities is supported by a design
team of 80 civil and electrical engineers and utility specialist
designers (on a full-time equivalent basis) providing support
across a wide range of water, energy, rail and telecom projects.
The main design brand used by the Utilities business is Source
Design Services. Core capabilities of the Utilities business
include:
o Water : Kier enables clean and waste water to flow to
approximately 18 million properties in the UK. Customers include
Thames Water, Scottish Water, Yorkshire Water, Affinity, South West
Water and Anglian Water;
o Electricity : Kier supports electricity connectivity for
approximately 10 million properties in the United Kingdom whilst
also carrying out emergency responses and building new connections
network re-enforcements and renewables. Clients include UK Power
Networks and Western Power Distribution;
o Gas : Kier provides similar services for several UK gas
companies. Kier is the only gas distribution contractor operating
in Northern Ireland. Customers include Phoenix Natural Gas, firmus
energy and SGN Natural Gas;
o Telecom : Working for all three of the UK's largest digital
infrastructure platforms, Kier keeps business and domestic
broadband services functioning, including:
-- Installing of high-speed fibre optic networks to "fibre-up"
the UK in both urban and rural environments for Openreach, Virgin
Media, CityFibre and others;
-- Providing 24/7 emergency restoration services to keep
broadband connections functioning throughout Scotland, South
London, the South East, South Coast, Hampshire and Berkshire;
and
-- Undertaking a task every 4 minutes, 24 hours a day,
maintaining key parts of the UK's 4G and 5G access network.
o Rail : Kier delivers essential high voltage power and
signalling operations to sections of the rail network responsible
for 1.7 billion rail passenger journeys (pre-COVID-19). Kier is
currently providing design and value optimisation of enabling works
for HS2. Other clients include Network Rail and Transport for
London.
Construction (56 per cent. of Group revenue for the six months
ended 31 December 2020 and 54 per cent. of Group revenue for the
financial year ended 30 June 2020):
Management believes that Kier's construction business is the #1
UK national builder. The business primarily delivers projects for
the public sector, typically delivering approximately 150 projects
for UK government departments and local authorities nationally with
a combined value in excess of GBP1 billion per annum. The projects
range in value from GBP150,000 to over GBP200 million and are
located across the UK, with 78 per cent. of projects for repeat
customers.
The Construction business has a dedicated building services
design and install organisation of 40 employees providing whole
project lifecycle support. The team are based in Basingstoke but
provide support across Construction. In addition, the Construction
business has use of 150 architectural and structural engineers,
building service designers, surveyors, project managers and
installers to support its business objectives and maximise asset
value.
Construction operates across a number of sectors including
Education, Health, Justice and Defence:
o Education: Kier is the delivered almost GBP5 billion of
primary, secondary and tertiary facilities in the past 15
years:
-- Kier currently has 24 Department for Education Framework
projects on site, with 5 schemes being developed in the
preconstruction phase; and
-- Kier delivers value for the Department of Education by
supporting design improvements, developing the wider social value
strategy, supporting the carbon agenda, using optimum procurement
arrangements and implementing effective risk management.
o Health: Kier has a long-standing collaborative relationship
with the health authorities across England, Scotland and Wales.
This expertise and ability to understand the demands and
requirements of the NHS enables Kier to respond to the specific
challenges of the UK health sector:
-- Kier has delivered over 100 healthcare projects in the past
10 years, working in partnership with over 80 NHS Trusts;
-- Kier currently has 16 health projects on site and 14 in
development;
-- Kier undertook the Project Management Office role in support
of NHS England and NHS Improvement in coordinating the national
effort to provide additional bed spaces in response to
COVID-19;
-- Additionally, Kier has responded to COVID-19 by providing
health and safety equipment and the delivery of surge hospitals to
Glasgow, Swansea and Bristol; and
-- Kier has a specialist healthcare team with the expertise to
assist the Department of Health to deliver its significant future
investment in the UK's health sector.
o Justice: Kier has a 14-year relationship with the Ministry of
Justice ("MoJ") delivering over GBP600 million of new build and
refurbishment projects across all categories of prison and courts,
for example:
-- Her Majesty's Prison ("HMP") Five Wells in Wellingborough,
which is due for completion in 2021, is a GBP253 million
resettlement prison comprising 60,000 square metres of
accommodation and ancillary buildings using Modern Methods of
Construction ("MMC") to maximise efficiency and value for money for
the taxpayer;
-- Kier's innovative approach builds on its experience of
successfully delivering the 1,600 capacity for HMP Oakwood, near
Wolverhampton;
-- The standardised design approach at HMP Wellingborough acts
as the blueprint for the platform-based design due to be rolled out
across the future prisons programme, as part of the providing
10,000 prison places;
-- Kier has hosted multiple design workshops and site tours to
showcase best practice to modern rehabilitative prison design;
-- Kier is undertaking carbon footprint analysis in
collaboration with the MoJ and Carbon Trust to determine
science-based targets to reduce carbon across the prison programme;
and
-- Kier is also leading the development of a MMC social value
calculator following its use on custodial projects.
o Defence: Kier is a key partner on national and regional
Defence Infrastructure Organisation ("DIO") frameworks and is
delivering a number of defence projects. Examples include:
-- RAF Lakenheath - a GBP246 million development programme to
deliver new base facilities and infrastructures for the US Air
Force F-35 Fighter Jet;
-- RAF Lyneham - a GBP50 million contract to build a military
technical training base; and
-- Other projects - over GBP100 million of projects involving
physical training and flight simulator facilities, barracks and
headquarter upgrades.
Property :
The Property business invests and develops schemes and sites
across the UK. This business was established in 2002 through the
acquisition of Laing Property Developments. It invests in and
develops schemes and sites across the United Kingdom and is
principally focussed on mixed-use urban regeneration schemes.
3.4. Kier's restructured and right-sized cost base
To support the delivery of the Group's strategic priorities Kier
has made a number of structural changes, including increasing the
level of divisional accountability, removing a number of layers of
management and significantly reducing the central overhead through
actions including outsourcing IT and fleet management
functions.
These changes have resulted in the Group's headcount reducing by
approximately 1,700 overall and Kier expects that this reduction in
headcount, along with the delivery of our other strategic actions,
will enable the Group to realise at least GBP115 million of
annualised cost savings by the end of the financial year ending 30
June 2021 (as compared to the financial year ended 30 June 2018),
while maintaining capacity to support additional growth. Kier
continues to review its cost base to identify additional cost
saving measures.
3.5. Kier's embedded culture of "Performance Excellence"
Kier now operates with a strong operational and financial risk
management framework, which is fundamental to and embedded in
Kier's contract selection and delivery processes.
Kier's Performance Excellence culture introduced a consistent
approach in how Kier develops and manages people, as well as
processes, projects, costs and its way of working:
-- Deliver projects on time and to budget, thereby meeting
clients' and customers' expectations;
-- Do not enter into contracts with unacceptable risk profiles;
-- Introduce increased levels of resilience, and a consistency
of approach, across the Group; and
-- Win new business with attractive margins.
Kier launched a new Operating Framework in January 2020, which
sets out the governance structure within which the Group now
operates, including a new framework for the assessment of contract
risk and new project reviews to ensure that the group only enters
into contracts with an acceptable and appropriate risk and
financial reward profile.
Performance Excellence is also fundamental to Kier's approach to
safety, with the aim of continuing to improve the overall safety
performance as Kier has done year-on-year over the past five
years.
3.6. Kier - laying down a sustainable path
In July 2020, Kier launched a new sustainability policy
"Building for a Sustainable World", which reframed sustainability
away from being an environmental specialism to being a strategic
and business critical mindset, balancing the need for environmental
resilience, community resilience and profitability in day to day
decision making. Across environmental and social sustainability,
the framework focuses on the following critical areas for
improvement and builds on the Group's historical successes:
Environmental sustainability
The framework is governed through Sustainability Leadership
Forums established at Group level and for each core business. Under
this framework, Kier has committed to achieving net zero carbon
across its own operations and supply chain by 2045, eliminating
single use plastics by 2030, and to tackling inequality by
providing support, opportunities and training to local
communities.
Kier's environmental sustainability approach is based on five
pillars:
-- Pollution prevention : Kier's annual target for avoidable
compliance is zero. Kier will restore and replenish environmental
areas affected by unavoidable compliance issues;
-- Responsible sourcing and supply chain : Kier will cause no
harm to the environment from the resources it uses;
-- Carbon impact: Kier will achieve net zero carbon across its
own operations and supply chain by 2045;
-- Zero waste: Kier will design out waste and produce no
avoidable waste by 2035. Kier's operations will be
single-use-plastic-free by 2030; and
-- Protection of habits and resources: Kier will promote a
healthy environment for future generations.
In the current financial year, the Group's businesses have
concentrated on achieving their environmental framework reduction
targets, which they are well on the way towards, and also on
developing the Group's pathway to Net Zero, with interim targets,
annual carbon budgets and limits on carbon off-setting. The Group
is launching carbon, water, waste and biodiversity, and seeking to
employ innovation, new technology and best practices in pollution
prevention. The pathway and budgets will be published in the
Group's annual report for the year ending 30 June 2021, along with
the refined social value targets for the year ending 30 June
2022.
Kier has won a number of "Green Apple" awards for biodiversity
and protected species enhancement. In partnership with Network
Rail, it won a "Sustainability & Environmental Excellence"
award at the 2020 Rail Business Awards, for its work in the
community. Kier was shortlisted for "Most Innovative Use of
Existing Tech" at the 2020 Water Industry Awards, as a result of
its collaboration with Huber and South West Water to reduce
chemical consumption and operating costs in the South West of the
UK.
Social sustainability
Kier is also focused on social sustainability: Kier's work and
actions directly and positively impact the communities it serves,
and this in turn generates wider value for society. The Group has
achieved progress on these objectives, including its graduate
intake comprising 27 per cent. women in 2018, and in 2020 achieving
99 per cent. of expenditure on a number of public sector frameworks
with SMEs and training 700 mental health first aiders. In 2021, the
Group introduced a new severity-based metric to focus on wider
health and safety performance in its operations. This follows an
established track record on social sustainability matters. For
example, Kier was the first construction company to support 16 to
25 year olds to have spent time as cared for children through the
Department of Education's Care Leaver Covenant. Kier's Highways
business and its HS2 joint venture are both Disability Confident
employers. The Highways business has also been a Disability
Confident Leader since 2019, enabling people of all abilities to
come into the workplace.
The independent organisation, the Social Value Business, awarded
Kier's Construction business the "Social Value Quality Mark" (Mark
1& 2), the standard it created to measure an organisation's
commitment to, and delivery of, social value. Kier is the first
construction company in the UK to be awarded the mark.
In October 2019, Kier was awarded "Innovation of the Year" at
the UK Social Mobility Awards for the development and
implementation of its Shaping Our Communities calculator which Kier
uses as a tool to record its social value.
The Group's social framework commitments include developing and
launching a new employee health and well-being strategy, as well as
a Group Equality, Diversity and Inclusion strategy to be driven by
appointment of a Group Head of Equality, Diversity and Inclusion.
These efforts will be supported by a focus on social purpose that
aims to tackle inequality by giving individuals and communities the
tools and opportunities to create brighter futures. The Group had
618 apprentices participating on a Kier apprenticeship programme
during the financial year ended 30 June 2020 (including 161
graduate apprentices) and expects to have developed 965 apprentices
by the end of the current financial year.
Governance and the Group's sustainability framework
Governance will remain a core component of the Group's approach
to operations. The Group monitors governance matters through Annual
BSI audits on ISO14001, 45001 & 9001 compliance, Integrated
Operational Assurance Statement & processes and operating
assurance statements. The Group's internal policy centre supports
the Group's efforts in governance focus areas such as modern
slavery, anti-bribery and corruption, data protection and
whistleblowing matters. Framework commitments on governance matters
include continued participation in sustainability leadership
forums, ensuring board oversight and cross-functional input, as
well as implementation of project lifecycle management systems and
processes, and continuous improvement of the Operational Assurance
Statement processes and increased training requirements.
3.7. Reasons for the Capital Raise
The Board believes that Kier has established a strong platform,
based on robust and focused operating performance and cash
generation, and that Kier has significant opportunities as a result
of the sector-leading positions of each of its businesses in its
chosen markets.
The Board believes that the Capital Raise will provide the Group
with the financial and operational flexibility to continue to
pursue its strategic objectives. In particular, the Capital Raise
will:
-- Create a strong, resilient and flexible balance sheet,
providing the Group with the capacity to invest, and its clients,
customers, suppliers and other stakeholders, with greater
confidence in Kier as a counterparty;
-- Increase the financial headroom available to the Group,
allowing for more effective working capital management in the
current environment; and
-- Facilitate the re-financing of the Group's existing borrowing
facilities (the terms of which are summarised in paragraph 3.9
below).
The Board has therefore concluded that the Capital Raise is in
the best interests of the Group.
3.8. Cash flow track record and use of proceeds
As at 31 December 2020, Kier had net debt of GBP354 million and,
in the six-month period to 31 December 2020, Kier had average
month-end net debt of GBP436 million (compared to GBP395 million in
the equivalent period to 31 December 2019). This net cash outflow
was the combination of strong operating cash flow in the period
offset by the cash impact of COVID-19, contributions to the Group's
Pension Schemes, and certain one off items.
In addition, Kier announced on 16 April 2021 the sale Kier
Living for gross proceeds of GBP110 million. The net proceeds from
this sale will be used to reduce the Group's indebtedness and the
current funding deficit under its Pension Schemes through a GBP10
million contribution.
The Group intends to use the net proceeds from the Capital Raise
of GBP229 million as follows:
o GBP144.4 million will be used to prepay a portion of the
balance outstanding under the 2017 RCF Facility and associated fees
payable to the lenders pursuant to the RCF Stage 3 Amendment;
o GBP43.4 million will be used to repay balances outstanding
under the Second Schuldschein Loan Agreement and the Fourth
Schuldschein Loan Agreement and associated fees payable to the
lenders pursuant to the 13 April 2021 amendments thereto;
o GBP16.5 million will be used to make payments to holders of
the 2012 Notes and 2014 Notes in respect of certain principle
amounts outstanding under the 2014 Notes and associated fees on the
2012 Notes and 2014 Notes payable to the lenders pursuant to the
2012 Stage 3 Amendment and the 2014 Stage 3 Amendment,
respectively;
o GBP6.8 million will be used to pay other fees associated with
the Principal Debt Facilities Stage Amendments;
o GBP0.7 million will be used to pay an additional contribution
to the trustee of the Group's pension schemes; and
o GBP16.9 million will be retained within the Group's cash
reserves.
The targeted result of these actions will be to:
o Immediately further reduce the Group's net debt; and
o Facilitate prudent investment in the business, so as to drive
sustainable, profitable organic growth and generate a sustainable
net cash position within 2-3 years.
3.9. Financing and liquidity
On 13 April 2021, the Group agreed with the Principal Debt
Facility lenders and noteholders to a series of amendments
permitting the extension of certain maturity dates and amendment of
certain terms of the Group's borrowings under these arrangements.
These Principal Debt Facilities Amendments comprise:
(i) the Principal Debt Facilities Stage 1 Amendments, which
became effective on 13 April 2021, and
(ii) the Principal Debt Facilities Stage 2 Amendments, which
become effective upon completion of certain conditions, namely
completion of the Capital Raise.
These Principal Debt Facilities Stage 1 Amendments provided for,
inter alia, the following:
-- pursuant to the RCF Stage 3 Amendments, extension of the RCF
Facility Termination Date to 30 September 2022, changes to the
interest coverage ratio, leverage ratio and consolidated net worth
covenants;
-- pursuant to the SSD3 Stage 3 Amendment, amendment to the
financial covenants in the Third Schuldschein Loan Agreement to
substantially align with the 2017 RCF Agreement (save certain
differences reflecting the longer remaining term in respect of the
Third Schuldschein Loan Agreement); and
-- pursuant to 2012 Stage 3 Amendment and the 2014 Stage 3
Amendment, respectively, amendment to the negative covenants in the
2012 Note Purchase Agreement and the 2014 Note Purchase Agreement
to substantially align with the 2017 RCF Agreement, and changes to
the interest coverage ratio, leverage ratio and consolidated net
worth covenants under each agreement.
The Group's agreements with the Principal Debt Facility lenders
and noteholders also provided for further amendments to and/or
extensions of the Group's borrowings under certain of the Principal
Debt Facilities. These Principal Debt Facilities Stage 2 Amendments
provide for, inter alia, the following:
-- 2017 RCF : extension of the RCF Facility Termination Date to
31 January 2025, prepayment and cancellation of GBP135 million of
available commitments, amendment of the applicable margin (and
leverage linked ratchet), revisions to remove quarterly covenant
testing and to amend covenant testing levels (as set out below),
and relaxation of operational restrictions;
-- Third Schuldschein Loan Agreement : an increase in the
applicable rate by 0.25 per cent. per annum, revisions to remove
quarterly covenant testing and the consolidated net worth and
liquidity covenants, amendment to the leverage ratio and interest
coverage ratio test levels (as set out below), and relaxation of
operational restrictions to align with the 2017 RCF;
-- 2012 Notes : an increase in the applicable rate by 0.25 per
cent. per annum, revisions to remove quarterly covenant testing and
the consolidated net worth and liquidity covenants, amendment to
the leverage ratio and interest coverage ratio test levels (as set
out below), and relaxation of operational restrictions to align
with the 2017 RCF;
-- 2014 Notes : extension of the 2014 Note (November 2024)
maturity date to 31 January 2025, an increase in the applicable
rate by 0.75 per cent. per annum (subject to further increases
dependent on the Group's leverage ratio), revisions to remove
quarterly covenant testing and the consolidated net worth and
liquidity covenants, amendment to the leverage ratio and interest
coverage ratio test levels (as set out below), relaxation of
operational restrictions to align with the 2017 RCF, and a
requirement to make an offer to redeem a portion of the 2014 Notes
at par (such offer to be made without make-whole) in an amount
equal to GBP15 million.
The changes to the Group's leverage ratio and interest cover
ratio covenants under the Principal Debt Facilities Stage 2
Amendments are set out in the following table:
Testing Date
2021 2022 2023 2024
-------------- -------------- -------------- --------------
June Dec. June Dec. June Dec. June Dec.
------ ------ ------ ------ ------ ------ ------ ------
Leverage Ratio
2017 RCF 4.00:1 3.50:1 3.00:1 3.00:1 3.00:1 3.00:1 2.50:1 2.50:1
Third Schuldschein Loan Agreement 4.00:1 3.50:1 3.00:1 3.00:1
2012 Notes 4.00:1 3.50:1 3.00:1
2014 Notes 4.00:1 3.50:1 3.00:1 3.00:1 3.00:1 3.00:1 2.50:1 2.50:1
Interest Cover
Ratio
2017 RCF 3.00:1 3.50:1 4.00:1 4.00:1 4.00:1 4.00:1 4.00:1 4.00:1
Third Schuldschein Loan Agreement 3.00:1 3.50:1 4.00:1 4.00:1
2012 Notes 3.00:1 3.50:1 4.00:1
2014 Notes 3.00:1 3.50:1 4.00:1 4.00:1 4.00:1 4.00:1 4.00:1 4.00:1
In addition, under the Principal Debt Facilities Stage 2
Amendments, the Group has also agreed to pay certain fees to the
Principal Debt Facility lenders and noteholders following the
Principal Debt Facilities Stage 2 Amendments Effective Date.
These borrowing arrangements, and the Principal Debt Facilities
Amendments, are further described in the Prospectus.
3.10. Pensions
Kier operates a number of defined benefit pension schemes (the "
Pension Schemes "). As at 31 December 2020, the net reported
accounting deficit, which is the difference between the aggregate
value of the schemes' assets and the present value of their future
liabilities, was GBP1.4 million, before accounting for deferred
tax.
The last triennial valuation of the following pension schemes
was carried out as at 31 March 2019.
As at 31 March 2019
Mouchel Mouchel
Kier Business Mouchel Business May
(GBP millions, Group Services Mouchel Staff Services Gurney
unless otherwise Pension Ltd Superannuation Pension Ltd Pension
indicated) Scheme - FS Fund Scheme - MP Scheme Total
-------- -------- -------------- ------- -------- ------- --------
Value of Assets 1,166.2 130.5 222.0 116.4 17.2 79.9 1,732.2
Liabilities (1,254.5) (141.3) (282.4) (153.6) (19.8) (98.7) (1,950.3)
-------- -------- -------------- ------- -------- ------- --------
Surplus /
(Deficit) (88.3) (10.8) (60.4) (37.2) (2.6) (18.8) (218.1)
93 92 79 76 87 81 89
per per per per per per per
Funding level cent.. cent.. cent.. cent.. cent. cent. cent.
Triennial valuations are a requirement of the Pensions Act 2004
and are conducted by an actuary for the trustees of a pension
scheme. The accounting method used to calculate an actuarial
deficit or surplus differs from IAS19 and so the figures shown
above do not equate to the reported accounting surplus.
In agreeing the triennial valuation as at 31 March 2019 of the
Group's main schemes, and due to the impact on COVID-19, the Group
has agreed a revised deficit recovery programme whereby GBP27
million was paid in the six month period to 31 December 2020, and
deficit repayments of GBP9 million per calendar year will begin
from July 2021. It has been agreed that, on completion of the Kier
Living Disposal, a contribution of GBP10 million shall be made
towards the funding of the pension schemes set out in the table
above. For clarity, the McNicholas Construction (Holdings) Ltd
Pension Scheme will not receive any contribution as a result of the
Kier Living Disposal.
The next triennial valuation for the above schemes is due to be
agreed as at 31 March 2022.
The last triennial valuation of the McNicholas Construction
(Holdings) Ltd Pension Scheme was carried out as at 31 March
2017.
As at 31 March 2017
-----------------------
McNicholas Construction
(Holdings) Ltd Pension
Scheme
-----------------------
(GBP millions, unless
otherwise indicated)
Value of Assets 21.1
Liabilities (26.8)
-----------------------
Surplus / (Deficit) (5.7)
Funding level 79 per cent.
Work is ongoing on the latest triennial valuation of the
McNicholas Construction (Holdings) Ltd Pension Scheme (as at 31
March 2020), though this has not yet been finalised and so figures
are currently unavailable.
3.11. Capital allocation
The Board recognises the importance of capital discipline across
the Group and, following completion of the Capital Raise, Kier
expects to adopt the following principles when allocating
capital:
-- Organic growth and cash generation: Kier will prioritise
investment in opportunities to optimise organic growth and generate
cash, where contract risk is considered to be appropriate relative
to the potential returns of the opportunity.
-- Balance sheet: Kier will operate with a strong, resilient and
flexible balance sheet, targeting a sustainable net cash position
in the medium term and a funding profile which is appropriate for
the medium and long-term needs of the Group.
-- Pensions: Kier will continue to support each of its pension
schemes in line with the deficit recovery funding schedule which
has been agreed with the trustees of each of the schemes from time
to time.
-- Dividends and dividend policy: Following completion of the
Capital Raise, and recognising the importance to the Group of
maintaining a strong and growing capital base, Kier will target a
dividend cover of around three times earnings through the cycle.
The Board will consider regularly the appropriateness of
re-instating a dividend in light of the capital needs of the
business and the progress made against its medium-term targets.
4. Current Trading and Prospects
Kier published its results for the six months ended 31 December
2020 on 21 April 2021 and made the following statement regarding
its current trading and prospects:
"The results for the period reflect the realisation of the
strategic imperatives outlined nearly two years ago. Kier is now
profitable and generating underlying operating cash. These
improvements result from the actions taken by the new management
team in the last 24 months which include, the appointment of a new
Executive team, the launch of Performance Excellence, the removal
of management layers throughout the organisation, the exit of
various contracts and business streams, and the implementation of a
significant reduction in our cost base. The conclusion of the
divestment of Living after the period end allows the Group to
further strengthen the balance sheet and focus on our core
businesses.
The Directors believe that the proposed Capital Raise is
required to reduce average net debt and strengthen the balance
sheet enabling the Group to drive sustainable, profitable organic
growth.
The streamlined Group with its attractive customer proposition
and history of complex project delivery has continued to win work
throughout the period and remains well placed to benefit from any
increased investment in UK infrastructure. The second half of the
year has started well seeing a continuation of the positive trends
of the first half and we are confident of achieving further
progress this year in line with our expectations."
Kier has continued to trade in line with the Board's
expectations since this statement was made.
5. Kier's Medium-Term Value Creation Plan
Kier intends to use the net proceeds from the Capital Raise to
further strengthen the Group's balance sheet, building on the Kier
Living Disposal, and to underpin Kier's medium-term value creation
plan to deliver:
-- Organic annual revenues of approximately GBP4.0 to GBP4.5 billion;
-- A resilient and well-balanced portfolio, focused on:
o Infrastructure Services (approximately 55 per cent of Group
revenue), comprising its Highways (20 per cent.), Infrastructure
(15 per cent.), and Utilities (20 per cent.) businesses; and
o Construction (approximately 40 per cent. of Group revenue),
comprising its Regional Building, Strategic Projects, International
and Kier Places businesses; plus
o An attractive UK Property business generating high return on capital employed in the business.
-- A sustainable Group adjusted operating margin of around 3.5 per cent.;
-- A well-invested asset base, consistently generating returns
which are in excess of Kier's cost of capital;
-- Strong, consistent and sustainable operating cash flows, with
operating cash flow conversion of around 90 per cent. of operating
profit; and
-- A strong, resilient and flexible balance sheet, with a
sustainable net cash position within 2-3 years, and the capacity to
invest in the future growth of the business and support a
sustainable dividend policy with dividend cover of around three
times earnings through the cycle.
The Group aims to drive these medium-term targets through a
reversal of the increased project costs and volumes impact
associated with COVID-19, and management discipline already
established throughout the Group is expected to continue to drive
additional margin growth. In addition, the Group expects to
continue to benefit from its revised policies around contract
volume / price mix, which are expected to drive organic revenue
growth and margin expansion.
6. The Capital Raise
Kier is proposing to raise gross proceeds of GBP241.4 million
(approximately GBP228.7 million after deduction of estimated fees,
costs and expenses of GBP12.7 million) under the Capital Raise by
way of:
(i) a Firm Placing of 141,851,386 Firm Placing Shares, to raise
gross proceeds of GBP120.6 million;
(ii) a Placing and Open Offer of 141,851,386 Open Offer Shares,
to raise gross proceeds of GBP120.6 million; and
(iii) Director Subscriptions of 347,057 Subscription Shares, to
raise gross proceeds of GBP0.3 million,
in each case at a price of 85 pence per New Ordinary Share. The
New Ordinary Shares will be issued credited as fully paid and will
rank pari passu in all respects with the Existing Shares, including
for dividends. The Firm Placing and Placing and Open Offer are
fully underwritten by the Joint Bookrunners on the terms and
subject to the conditions of the Underwriting Agreement, details of
which are set out in the Prospectus.
A cash box structure will be used for the issue of the Firm
Placing Shares and the Open Offer Shares pursuant to the Firm
Placing and Placing and Open Offer.
The Board has considered the best way to structure the proposed
Capital Raise. The decision to structure the Capital Raise by way
of a combination of a Firm Placing and a Placing and Open Offer
takes into account a number of factors, including the total net
proceeds to be raised. The Board believes that the Firm Placing
will enable Kier to satisfy demand from potential new investors.
The Board has sought to balance the dilution to Shareholders not
participating in the Firm Placing with the benefits of attracting
new investors with guaranteed commitments to ensure the success of
the Firm Placing and Placing and Open Offer. As a result, 49.9 per
cent. of the New Ordinary Shares being issued will be available to
existing Shareholders through the Open Offer on a pro rata basis.
The Board is seeking the approval of Shareholders, by way of the
Resolutions at the General Meeting, to undertake the proposed
Capital Raise.
Further details of the terms and conditions of the Open Offer,
including the procedure for acceptance and payment and the
procedure in respect of Open Offer Entitlements not taken up, are
set out in Part III of the Prospectus and, where relevant, the
Application Form. Overseas Shareholders should refer to the
Prospectus for further information regarding their ability to
participate in the Firm Placing and Placing and Open Offer.
6.1. Price
The Firm Placing and Placing and Open Offer and the Director
Subscriptions will each be made at a price of 85 per New Ordinary
Share (the "Issue Price"). The Issue Price represents a 17.0 per
cent. discount to the Closing Price of 102.4 pence on 12 May 2021.
The Issue Price (and the discount) has been set by the Board
following their assessment of the prevailing market conditions and
anticipated demand for the New Ordinary Shares. The Board believes
that the Issue Price (including the discount) is appropriate in the
circumstances.
6.2. Firm Placing
Kier proposes to issue 141,851,386 Firm Placing Shares to Firm
Placees at the Issue Price on a non-pre-emptive basis. The Firm
Placing will not be subject to clawback to satisfy valid
applications for Open Offer Shares by Qualifying Shareholders under
the Open Offer.
Pursuant to the Underwriting Agreement, the Joint Bookrunners
have severally agreed to use reasonable endeavours to procure
subscribers for the Firm Placing Shares at the Issue Price. If the
Joint Bookrunners are unable to procure subscribers for any of the
Firm Placing Shares (or if a prospective Firm Placee fails to take
up any or all of the Firm Placing Shares which have been allocated
to it or which it has agreed to take up at the Issue Price), then
each of the Joint Bookrunners has agreed, on the terms and subject
to the conditions set out in the Underwriting Agreement, severally
(and not jointly or jointly and severally) to subscribe for such
Firm Placing Shares at the Issue Price in its agreed
proportion.
6.3. Placing and Open Offer
Under the Open Offer, Qualifying Shareholders are being given
the opportunity to subscribe for Open Offer Shares pro rata to
their Existing Holdings on the basis of 7 Open Offer Shares for
every 8 Existing Ordinary Shares held by them and registered in
their name at the Record Date (and so in proportion to any other
number of Existing Ordinary Shares then held) on the terms and
subject to the conditions set out in the Prospectus (and, in the
case of Qualifying Non-CREST Shareholders, the Application
Form).
Qualifying Shareholders may apply for any whole number of Open
Offer Shares in excess of their Open Offer Entitlement up to a
maximum additional amount equal to such Qualifying Shareholder's
Open Offer Entitlement, subject always to the Individual
Shareholder Limit. The Excess Application Facility enables
Qualifying Shareholders who have taken up their Open Offer
Entitlement in full to apply for any whole number of additional
Open Offer Shares equal to or less than their Open Offer
Entitlement which, in the case of Qualifying Non-CREST
Shareholders, is equal to the number of Open Offer Entitlements as
shown on their Application Form or, in the case of Qualifying CREST
Shareholders, is equal to the number of Open Offer Entitlements
standing to the credit of their stock account in CREST. Qualifying
Shareholders with holdings of Existing Ordinary Shares in both
certificated and uncertificated form are treated as having separate
holdings for the purpose of calculating their Open Offer
Entitlements under the Open Offer. Applications under the Excess
Application Facility will be satisfied only to the extent that
corresponding applications by other Qualifying Shareholders are not
made or are made for less than their Open Offer
Entitlements. Applications under the Excess Application Facility
shall be allocated in such manner as the Directors may determine,
in their absolute discretion, and no assurance can be given that
the applications for additional Open Offer Shares under the Excess
Application Facility by Qualifying Shareholders will be met in full
or in part or at all. Fractions of Open Offer Shares will not be
allotted and each Qualifying Shareholder's Open Offer Entitlement
under the Open Offer will be rounded down to the nearest whole
number. Holdings of Existing Ordinary Shares in certificated and
uncertificated form will be treated as separate holdings for the
purpose of calculating Open Offer Entitlements.
Any Open Offer Shares which are not applied for under the Open
Offer or the Excess Application Facility may be allocated to
Conditional Placees at the Issue Price, with the proceeds retained
for the benefit of Kier. Pursuant to the Underwriting Agreement,
the Joint Bookrunners have severally agreed to use reasonable
endeavours to procure Conditional Placees (subject to clawback in
respect of valid applications for Open Offer Shares by Qualifying
Shareholders under the Open Offer and the Excess Application
Facility) for the Open Offer Shares at the Issue Price. If the
Joint Bookrunners are unable to procure Conditional Placees for any
Open Offer Shares that are not taken up by Qualifying Shareholders
pursuant to the Open Offer or the Excess Application Facility (or
if a prospective Conditional Placee fails to take up any or all of
the Firm Placing Shares which have been allocated to it or which it
has agreed to take up at the Issue Price), then each of the Joint
Bookrunners has agreed, on the terms and subject to the conditions
set out in the Underwriting Agreement, severally (and not jointly
or jointly and severally) to subscribe for such Open Offer Shares
at the Issue Price in its agreed proportion.
Shareholders should be aware that the Open Offer is not a rights
issue. As such, Qualifying Non-CREST Shareholders should note that
their Application Forms are not negotiable documents and cannot be
traded. Qualifying CREST Shareholders should note that, although
the Open Offer Entitlements and Excess Open Offer Entitlements will
be admitted to CREST, and be enabled for settlement, the Open Offer
Entitlements and Excess Open Offer Entitlements will not be
tradeable or listed and applications in respect of the Open Offer
may only be made by the Qualifying Shareholder originally entitled
or by a person entitled by virtue of a bona fide market claim by
Euroclear UK's Claims Processing Unit. The Excess Open Offer
Entitlements will not transfer with the Open Offer Entitlements
claim, but will be transferred as a separate claim. Euroclear UK's
Claims Processing Unit will not generate market claims for the
Excess CREST Open Offer Entitlements. Qualifying CREST Shareholders
claiming Excess CREST Open Offer Entitlements by virtue of a bona
fide market claim are advised to contact the Receiving Agent to
request a credit of the appropriate number of Excess CREST Open
Offer Entitlements to their CREST account.
Open Offer Shares for which application has not been made under
the Open Offer will not be sold in the market for the benefit of
those who do not apply under the Open Offer and Qualifying
Shareholders who do not apply to take up their entitlements will
have no rights, and will not receive any benefit, under the Open
Offer. Any Open Offer Shares which are not applied for under the
Open Offer may be allocated to Conditional Placees, subject to the
terms and conditions of the Underwriting Agreement, with the
proceeds retained for the benefit of Kier.
6.4. Dilution
If a Qualifying Shareholder who is not a Placee does not take up
any of his Open Offer Entitlements, such Qualifying Shareholder's
holding, as a percentage of the Enlarged Share Capital, will be
diluted by 63.7 per cent. as a result of the Capital Raise.
If a Qualifying Shareholder who is not a Placee takes up his
Open Offer Entitlement in full and does not apply for any Open
Offer Shares under the Excess Application Facility, such Qualifying
Shareholder's holding, as a percentage of the Enlarged Share
Capital, will be diluted by 31.9 per cent. as a result of the
Capital Raise.
If a Qualifying Shareholder who is not a Placee takes up (i) its
Open Offer Entitlement in full, and (ii) the maximum additional
amount available to it under the Excess Application Facility (equal
to its Open Offer Entitlement), such Qualifying Shareholder's
holding, as a percentage of the Enlarged Share Capital, will be
diluted by 0.1 per cent. as a result of the Capital Raise.
6.5. Conditionality
The Firm Placing and Placing and Open Offer are conditional,
inter alia, upon:
(i) the Resolutions having been passed by Shareholders at the General Meeting;
(ii) the Underwriting Agreement having become unconditional in
all respects, save for the condition relating to Admission, and not
having been terminated in accordance with its terms before
Admission occurs;
(iii) completion under the sale and purchase agreement relating
to the Kier Living Disposal having occurred (including the Company
having received the proceeds due to it in respect of the Kier
Living Disposal); and
(iv) Admission having become effective by not later than 8.00
a.m. on 18 June 2021 (or such later time and/or date as the Joint
Bookrunners, the Sponsor and Kier may agree, not being later than
25 June 2021).
If any of the conditions are not satisfied or, if applicable,
waived, then the Firm Placing and Placing and Open Offer will not
take place.
7. General Meeting
The Prospectus includes a Notice convening a General Meeting to
be held at 10.00 a.m. on 16 June 2021 at the Tungsten Building,
Central Boulevard, Blythe Valley Park, Solihull B90 8AU. The
purpose of the General Meeting is to consider and, if thought fit,
to pass the Resolutions. In light of the guidance related to
physical meetings due to the COVID-19 pandemic (detailed in Note 1
of the Notice of General Meeting), the Chairman and the Chief
Executive will be in attendance at the General Meeting to ensure a
quorum and to conduct the business of the meeting and no other
Directors will be physically present. Social distancing measures
may need to be in place in order to comply with current guidance.
Please be aware that in accordance with current UK government
advice, Shareholders are strongly encouraged not to attend the
General Meeting in person. Accordingly, Shareholders are encouraged
to vote as outlined below and to submit questions in advance of the
meeting by emailing cosec@kier.co.uk. Questions will also be
permitted during the General Meeting via the same email address
cosec@kier.co.uk or by telephone.
Shareholders are able to complete and return a form of proxy in
accordance with the procedures set out below in order to vote in
advance of the General Meeting. Arrangements have also been made to
allow Shareholders to submit questions to the Board during the
General Meeting via email at cosec@kier.co.uk or by telephone (see
Notes 3 and 4 of the Notice of General Meeting). Shareholders are
strongly encouraged to appoint the Chairman of the General Meeting
as their proxy, which will ensure their votes are cast in
accordance with their wishes. Depending on continued restrictions
on public gatherings or other government measures at the time of
the General Meeting, it may not be possible for other named proxies
to physically attend.
The Company will hold a live webcast of the General Meeting for
shareholders at www.kier.co.uk/investors. To be able to attend the
webcast, shareholders will need to have registered by no later than
5.00 p.m. on 15 June 2021. Details of how to do so are on the
Company's website.
Shareholders may also dial in to the General Meeting and will be
able to ask questions to the Chairman during the meeting over the
phone. If you are calling from within the UK, please dial 0203 936
2999; the call will be charged at your standard geographic rate. If
you are calling from outside the UK, please dial +44 203 936 2999;
you will be charged at the applicable international rate. The
access code for the telephone call is 799437. There is no need to
register if you wish to join the telephone call.
The methods available to appoint a proxy are set out below:
(a) appointing a proxy electronically via the shareholder portal
(www.signalshares.com). To vote via the shareholder portal enter
"Kier Group plc" into the searchbox, click "Search" and click on
the Company's name to be taken to the login page. From there,
shareholders can log into their Link share portal account or
register for the Link share portal by following the on-screen
instructions. Shareholders will need their Investor Code (IVC)
which can be found on their share certificate;
(b) if you are an institutional investor, appointing a proxy
electronically via the Proxymity platform, a process which has been
agreed by the Company and approved by the Company's Registrar.
Before appointing a proxy through Proxymity, a Shareholder will
need to have agreed to Proxymity's associated terms and conditions.
It is important that Shareholders read these carefully as they will
be bound by them and they will govern the electronic appointment of
their proxy. Further information in relation to Proxymity is
available at www.proxymity.io;
(c) returning the completed form of proxy to Link Group, 10(th)
Floor, Central Square, 29 Wellington Street, Leeds, LS1 4DL; or
(d) in the case of CREST members, using the CREST electronic
proxy appointment service in accordance with the procedures set out
in the Notice of General Meeting set out at the end of the
Prospectus,
and in each case with instructions to be received by Link Group
as soon as possible, but in any event by no later than 10.00 a.m.
on 14 June 2021 (or, in the case of an adjournment, not later than
two business days before the time fixed for the holding of the
adjourned meeting).
Further details relating to voting by proxy are set out in the
Notes to the Notice of General Meeting at the end of the
Prospectus.
The Board will keep the situation under review and may need to
make further changes to the arrangements relating to the General
Meeting, including how it is conducted. Shareholders should
continue to monitor the Company's website and announcements for any
updates in relation to the General Meeting. Shareholders should
also continue to monitor any guidance and/or directions issued by
the UK government and relevant health authorities and act
accordingly.
In summary, the Resolutions (which comprise two ordinary
resolutions) seek the approval of Shareholders:
(i) to the terms (including as to the discount) of the Capital
Raise as set out in the Prospectus, and to direct the Board to
exercise all powers to cause Kier to implement the Capital Raise;
and
(ii) to grant the Board authority to allot the New Ordinary
Shares for the purposes of the Capital Raise pursuant to section
551 of the Companies Act; and
Please note that this is not the full text of the Resolutions
and you should read this section in conjunction with the Notice of
General Meeting set out at the end of the Prospectus.
8. Working Capital
The Company is of the opinion that, taking into account the net
proceeds of the Firm Placing and Placing and Open Offer and the
bank and other facilities available to the Group, the Group has
sufficient working capital for its present requirements, that is,
for at least 12 months from the date of the Prospectus.
The working capital statement in the Prospectus has been
prepared in accordance with the ESMA Recommendations relating to
working capital statements, and the technical supplement to the FCA
Statement of Policy published 8 April 2020 relating to the COVID-19
crisis. In preparing the working capital statements above, the
Company is required to identify, define and consider a reasonable
worst-case scenario, which has involved making certain assumptions
regarding the evolution of the COVID-19 pandemic and its potential
impact on the Group, which are described in the Prospectus.
9. Directors' Participation in the Capital Raise
Pursuant to the Director Subscriptions, separate to the Firm
Placing and Placing and Open Offer, certain Directors have agreed
with the Company to subscribe for Subscription Shares at the Issue
Price, conditional upon Admission occurring, as follows.
(i) Each of Matthew Lester, Andrew Davies and Simon Kesterton
(or their closely associated persons) proposes to subscribe for
88,235 Subscription Shares for an investment amount of GBP75,000;
and
(ii) Each of Justin Atkinson and Clive Watson (or their closely
associated persons) proposes to subscribe for 41,176 Subscription
Shares for an investment amount of GBP35,000,
which in each case represents an investment in excess of their
pro rata entitlements under the Open Offer.
Such Director Subscriptions are not related party transactions
requiring Shareholder approval in accordance with Chapter 11 of the
Listing Rules due to their size. Such Director Subscriptions are
not underwritten by the Joint Bookrunners pursuant to the
Underwriting Agreement. However, due to the small quantum of such
subscriptions in the overall context of the Capital Raise, the fact
that they are not underwritten does not materially impact the
Capital Raise. For further information on the Director
Subscriptions, see the Prospectus.
10. Directors' Intentions and Recommendation
The Board is fully supportive of the Capital Raise and believes
that the Capital Raise is in the best interests of the Company and
the Shareholders as a whole. Accordingly, the Board unanimously
recommends that Shareholders vote in favour of each of the
Resolutions to be put to the General Meeting.
Each of the Directors who is a Shareholder intends to vote in
favour of the Resolutions to be proposed at the General
Meeting.
APPIX II
CAPITAL RAISE STATISTICS
Number of Shares in issue on 10 May 2021(1)
........................................ 162,115,870
Number of Firm Placing Shares to be issued
by the Company pursuant to the Firm
Placing.............................................................................. 141,851,386
Number of Open Offer Shares to be issued by
the Company pursuant to the Placing and Open
Offer............................................................. 141,851,386
Number of Subscription Shares to be issued
by the Company pursuant to the Director Subscriptions 347,057
Aggregate number of New Ordinary Shares to
be issued by the Company pursuant to the Capital
Raise................................................ 284,049,829
Enlarged Share Capital immediately following
completion of the Capital Raise(2)
...........................................................................................
.... 446,165,699
New Ordinary Shares as a percentage of Enlarged
Share Capital immediately following completion
of the Capital Raise (2) ....................... 63.7 per cent.
Open Offer 7 New Ordinary
Entitlement........................................................................ Shares for every
8 Existing Ordinary
Shares
Issue
Price......................................................................................
.... 85 pence
Discount of the Issue Price to the Closing
Price of 102.4 pence per Share on 12 May
2021......................................................................... 17.0%
Estimated fees, costs and expenses in connection
with the Capital
Raise......................................................................................
............ GBP12.7 million
Estimated net proceeds of the Capital Raise
receivable by the
Company....................................................................................
...................... GBP228.7 million
Notes:
(1) Being the latest practicable date prior to the date of
the Prospectus.
(2) Assuming that no Shares are issued pursuant to options
exercised under the Sharesave Scheme are exercised between
the date of the Prospectus and Admission becoming effective.
APPIX III
DEFINITIONS
The following definitions apply throughout this Announcement
unless the context requires otherwise:
"Admission" admission of the New Ordinary Shares
to be issued pursuant to the Capital
Raise to the premium listing segment
of the Official List and to trading
on the London Stock Exchange's main
market for listed securities;
"Affiliates" (a) in respect of each Joint Bookrunner,
any other person that, directly or
indirectly through one or more intermediaries,
controls, or is controlled by, or is
under common control with, such person
and specifically includes subsidiaries,
branches, associated companies and
holding companies and the subsidiaries
of such holding companies, branches,
associated companies and subsidiaries;
and for these purposes "controlling
person" means any person who controls
any other person; "control" (including
the terms "controlling", "controlled
by" and "under common control with")
means the possession, direct or indirect,
of the power to direct or cause the
direction of the management, policies
or activities of a person whether through
the ownership of securities, by contract
or agency or otherwise; and the term
"person" is deemed to include a partnership;
and (b) in respect of the Company an
undertaking which is its subsidiary
undertaking or parent or a subsidiary
undertaking of that parent undertaking;
in relation to the sections that relate
to US securities laws, the meaning
given to it in Rule 405 or Rule 501(b)
under the Securities Act (as applicable
in the context used);
"Application Form" the application to be issued to Qualifying
Non-CREST Shareholders who are registered
on the register of the Company at the
Record Date for use in connection with
the Open Offer;
"Bookbuild" the accelerated bookbuild by which
the Firm Placing and the Placing are
being conducted;
"Business Day" a day (other than Saturday, Sunday
or a public holiday) in England and
Wales;
"Capital Raise" the Firm Placing and the Placing and
Open Offer and the Director Subscriptions;
"Company" Kier Group plc;
"Conditional Placee" any person that has been procured by
the Joint Bookrunners to subscribe
for the Open Offer Shares issued in
connection with the Placing subject
to clawback to satisfy valid applications
by Qualifying Shareholders under the
Open Offer;
"Conditions" all conditions to the obligations of
the Joint Bookrunners included in the
Placing Agreement;
"CREST" the electronic transfer and settlement
system for the paperless settlement
of trades in listed securities operated
by Euroclear;
"CREST member" a person who has been admitted to Euroclear
as a system-member (as defined in the
CREST Regulations);
"Directors" the directors of the Company, and 'Director'
means any one of them;
"Director Subscriptions" the subscription of New Ordinary Shares
by certain Directors (or their closely
associated persons), further details
of which are to be contained in paragraph
6.2 "Directors' participation in the
Capital Raise" of Part X "Additional
Information" of the Prospectus;
"EEA" the European Economic Area, being the
European Union, Iceland, Norway and
Liechtenstein;
"Equity Placings" the Firm Placing and the Placing;
"Euroclear" Euroclear UK and Ireland Limited, the
operator (as defined in the CREST Regulations)
of CREST;
"Excluded Territories" the Commonwealth of Australia, its
territories and possessions, each province
and territory of Canada, Japan and
the Republic of South Africa and any
other jurisdiction where the extension
into or availability of the Firm Placing
and Placing and Open Offer would breach
any applicable law;
"Existing Ordinary Shares" the 162,115,870 Ordinary Shares in
issue as at 10 May 2021 (being the
latest practicable date prior to publication
of this Announcement);
"FCA" the United Kingdom Financial Conduct
Authority;
"FCA Handbook" the FCA's Handbook of Rules and Guidance,
as amended from time to time;
"Firm Placee" any person that has agreed to subscribe
for Firm Placing Shares pursuant to
the Firm Placing;
"Firm Placing" the placing by the Joint Bookrunners,
as agents of and on behalf of the Company,
of the Firm Placing Shares with Firm
Placees on the terms and subject to
the conditions contained in the Placing
Agreement and this Announcement;
"Firm Placing Shares" the 141,851,386 New Ordinary Shares
which are to be issued pursuant to
the Firm Placing;
"FSMA" the Financial Services and Markets
Act 2000, as amended;
"General Meeting" the general meeting of the Company
to be held on 16 June 2021, or any
adjournment thereof, to consider and,
if thought fit, to approve the Resolutions;
"Group" the Company and its subsidiary undertakings
from time to time;
"Indemnified Person" each of the Company, Rothschild & Co,
the Joint Bookrunners and each of its
or their respective Affiliates and
each of its and their, and each of
its and their respective Affiliates',
respective directors, officers, employees
and agents (in each case whether present
or future);
"Issue Price" 85 pence per New Ordinary Share;
"Joint Bookrunners" Numis and Peel Hunt;
"Kier Living Disposal" the sale of all shares in Kier Living
Limited pursuant to a sale and purchase
agreement entered into on 16 April
2021 with Foster BidCo Limited;
"Listing Rules" the listing rules made by the FCA under
FSMA as amended from time to time;
"London Stock Exchange" London Stock Exchange plc;
"MiFID II" EU Directive 2014/65/EU on markets
in financial instruments, as amended;
"New Ordinary Shares" 284,049,829 new Ordinary Shares proposed
to be issued and allotted by the Company
pursuant to the Capital Raise;
"Numis" Numis Securities Limited;
"Official List" the Official List maintained by the
FCA;
"Open Offer" the invitation to Qualifying Shareholders
to subscribe for the Open Offer Shares
at the Issue Price on the terms and
subject to the conditions to be set
out in the Prospectus and in the case
of Qualifying Non-CREST Shareholders
only, the Application Form/US Investor
Letter (as applicable);
"Open Offer Entitlements" the pro rata entitlement of Qualifying
Shareholders to subscribe for 7 Open
Offer Shares for every 8 Existing Ordinary
Shares registered in their name as
at the Record Date, on and subject
to the terms of the Open Offer;
"Open Offer Shares" means the 141,851,386 New Ordinary
Shares which are proposed to be issued
to Conditional Placees in the Placing,
subject to clawback to satisfy Valid
Applications in the Open Offer;
"Ordinary Shares" an ordinary share in the capital of
the Company (including, if the context
requires, the New Ordinary Shares),
being an ordinary share of one pence
each in the capital of the Company;
"Overseas Shareholders" Qualifying Shareholders with registered
addresses in, or who are citizens,
residents or nationals of, jurisdictions
outside of the United Kingdom;
the "Order" the Financial Services and Markets
Act 2000 (Financial Promotion) Order
2005, as amended;
"Peel Hunt" Peel Hunt LLP;
"Placee" any Firm Placee and/or Conditional
Placee, as the case may be;
"Placing" the conditional placing, by the Joint
Bookrunners, on behalf of the Company,
of the Open Offer Shares with Conditional
Placees subject to clawback to satisfy
valid applications by Qualifying Shareholders
under the Open Offer pursuant to the
terms and subject to the conditions
contained in in the Placing Agreement
and this Announcement;
"Placing Agreement" the Sponsor, Firm Placing and Placing
and Open Offer Agreement dated 13 May
2021 between the Company, Rothschild
& Co and the Joint Bookrunners relating
to the Capital Raise;
"Placing Proof" for the purposes of the Firm Placing
and the Placing the draft prospectus
dated 11 May 2021 prepared by, and
relating to, the Company;
"Prospectus" the prospectus (when published), comprising
a circular and a prospectus relating
to the Company for the purpose of the
Capital Raise and Admission;
"Prospectus Regulation the prospectus regulation rules made
Rules" by the FCA pursuant to Part VI of FSMA
(as set out in the FCA Handbook), as
amended from time to time;
"Qualified institutional "qualified institutional buyer" as
buyer" or "QIB" defined in Rule 144A of the Securities
Act;
"Qualifying CREST Shareholders" Qualifying Shareholders holding Ordinary
Shares in uncertificated form on the
Record Date;
"Qualifying Non-CREST Qualifying Shareholders holding Ordinary
Shareholders" Shares in certificated form on the
Record Date;
"Qualifying Shareholders" holders of Ordinary Shares on the register
of members of the Company at the Record
Date with the exclusion of (a) subject
to certain exceptions, Overseas Shareholders
with a registered address or located
or resident in any Excluded Territory,
and (b) Shareholders resident in the
United States other than those who
are reasonably believed to be qualified
institutional buyers and who deliver
to the Company a signed investor letter;
"Record Date" close of business on 12 May 2021;
"Regulations" the Proceeds of Crime Act 2002, the
Terrorism Act 2000, the Terrorism Act
2006 and the Money Laundering, Terrorist
Financing and Transfer of Funds (Information
on the Payer) Regulations 2017 and
the Criminal Justice (Money Laundering
and Terrorism Financing) Act 2010 and
any related or similar rules, regulations
or guidelines, issued, administered
or enforced by any government agency
having jurisdiction in respect thereof;
"Regulation S" Regulation S under the Securities Act;
"Resolutions" the resolutions to be proposed at the
General Meeting in connection with
the Capital Raise as set out in the
'Notice of the General Meeting';
" Rothschild & Co" N.M. Rothschild & Sons Limited;
"Rules" the rules of the FCA Handbook;
"Securities Act" the US Securities Act of 1933, as amended;
"Shareholders" holders of Ordinary Shares;
"UK" or "United Kingdom" the United Kingdom of Great Britain
and Northern Ireland;
"US" or "United States" the United States of America, its territories
or "United States of America" and possessions, any State of the United
States and the District of Columbia;
and
"US Open Offer Investor the investor representation letter
Letter" in relation to the Open Offer to be
executed and returned to the Company
by Qualifying Shareholders who are
in the United States and are QIBs;
and
"US Placing Investor Letter" the investor representation letter
in relation to the Equity Placings
to be executed and returned to the
Joint Bookrunners by placees located
in the United States and who are QIBs.
Unless otherwise indicated in this Announcement, all references
to "GBP", "GBP", "pounds", "pound sterling", "sterling", "p",
"penny" or "pence" are to the lawful currency of the UK
APPIX IV
KEY RISKS SPECIFIC TO THE ISSUER
-- The COVID-19 pandemic has materially and adversely affected
the Group's business and the ultimate impact on its business and
nancial results will depend on future developments.
-- Global economic conditions or other macroeconomic or
political developments in the geographic regions and markets in
which the Group operates may adversely affect its business,
financial condition and results of operations.
-- The Group operates in highly competitive markets.
-- The Group depends on UK government customers and other UK
public sector bodies and agencies for a substantial proportion of
its revenues.
-- Changes in governments' budgets, policies and investment
levels may adversely affect the Group's business, financial
condition and results of operations.
-- The conditions and covenants contained in the Group's
financing arrangements limit its financial and operating
flexibility.
-- If the Principal Debt Facilities Stage 2 Amendments do not
become effective, the Group could be required to source alternate
financing arrangements, which could increase costs or restrict
operating activities compared to Principal Debt Facilities.
-- The Group may not be successful in the implementation of its
strategic actions or any additional or replacement strategy or
strategic actions.
-- Contracts are subject to the risks associated with pricing,
cost overruns and delays, contract management, as well as risks
associated with delays in payment by customers.
-- Failure to successfully defend claims made by customers,
suppliers or sub-contractors, or failure to recover adequately on
claims made against customers, suppliers or sub-contractors, could
materially adversely affect the Group's business, financial
condition and results of operations.
-- Failure to meet customer expectations on project delivery
could result in reputational damage and/or loss of repeat business
and potentially lead to litigation.
-- Failure or security breaches of information technology ("IT")
systems and/or data security may result in losses for the
Group.
APPIX V
TERMS AND CONDITIONS OF THE FIRM PLACING AND THE PLACING
IMPORTANT INFORMATION ON THE FIRM PLACING AND PLACING FOR
INVITED PLACEES ONLY.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE FIRM
PLACING OR THE PLACING. THE TERMS AND CONDITIONS SET OUT HEREIN ARE
FOR INFORMATION PURPOSES ONLY AND ARE ONLY DIRECTED AT, AND BEING
DISTRIBUTED TO, 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:
(A) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"),
PERSONS WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE
2(E) OF REGULATION (EU) 2017/1129 (AS AMED) (THE "PROSPECTUS
REGULATION") ("QUALIFIED INVESTORS"); OR (B) IF IN THE UNITED
KINGDOM, PERSONS WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF
ARTICLE 2(E) OF REGULATION (EU) 2017/1129 (AS AMED) AS IT FORMS
PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT
2018 (THE "UK PROSPECTUS REGULATION") WHO ARE ALSO: (I) PERSONS WHO
FALL WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONALS" IN ARTICLE
19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL
PROMOTION) ORDER 2005, AS AMED (THE "ORDER"); (II) PERSONS FALLING
WITHIN ARTICLE 49(2) OF THE ORDER; OR (III) PERSONS TO WHOM IT MAY
OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS IN (B)
TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"), IN EACH CASE WHO
HAVE BEEN INVITED TO PARTICIPATE IN THE FIRM PLACING AND/OR THE
PLACING BY THE JOINT BOOKRUNNERS.
THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR
RELIED ON, IN THE EEA, BY PERSONS WHO ARE NOT QUALIFIED INVESTORS
OR, IN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT RELEVANT PERSONS.
ANY PERSON WHO HAS RECEIVED OR IS DISTRIBUTING THESE TERMS AND
CONDITIONS MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY
INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THESE TERMS AND
CONDITIONS RELATE IS, IN THE EEA, AVAILABLE ONLY TO QUALIFIED
INVESTORS AND, IN THE UNITED KINGDOM, AVAILABLE ONLY TO RELEVANT
PERSONS AND WILL BE ENGAGED IN ONLY WITH SUCH PERSONS. THESE TERMS
AND CONDITIONS DO NOT THEMSELVES CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
THE SECURITIES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (THE "SECURITIES
ACT") OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF
THE UNITED STATES AND THE SECURITIES MAY NOT BE OFFERED, SOLD,
TRANSFERRED OR DELIVERED, DIRECTLY OR INDIRECTLY IN, INTO OR WITHIN
THE UNITED STATES, EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. THERE WILL BE
NO PUBLIC OFFERING OF THE SECURITIES IN THE UNITED STATES.
EACH INVITED PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO
LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN ACQUISITION OF NEW
ORDINARY SHARES (AS SUCH TERM IS DEFINED IN THE ANNOUNCEMENT OF
WHICH THESE TERMS AND CONDITIONS FORM PART).
Unless otherwise defined in these terms and conditions,
capitalised terms used in these terms and conditions shall have the
meaning given to them in the Announcement of which these terms and
conditions form part.
If a Relevant Person, in the United Kingdom, or a Qualified
Investor, in the EEA, indicates to the Joint Bookrunners that it
wishes to participate in the Firm Placing and/or the Placing by
making an oral or written offer to subscribe for the Firm Placing
Shares and/or Open Offer Shares pursuant to the terms of the Firm
Placing and/or Placing it will be deemed to have read and
understood each of: (i) these terms and conditions; (ii) the
Announcement of which these terms and conditions form part; and
(iii) the Placing Proof in their entirety, to be making such offer
to participate in accordance with these terms and conditions and to
be providing the representations, warranties, indemnities,
agreements and acknowledgements contained in these terms and
conditions. In particular, each such Placee represents, warrants,
undertakes and acknowledges to the Company, Rothschild & Co and
the Joint Bookrunners that:
1. if it is a Qualified Investor in the EEA or a Relevant Person
in the UK, it will subscribe for, hold, manage and dispose of any
of the New Ordinary Shares that are allocated to it for the
purposes of its business only;
2. if it is in the EEA and subscribes for New Ordinary Shares
pursuant to the Equity Placings, it is a Qualified Investor;
3. if it is in the UK and subscribes for New Ordinary Shares
pursuant to the Equity Placings, it is a Relevant Person;
4. it is acquiring the New Ordinary Shares for its own account
or is acquiring the New Ordinary 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, agreements and acknowledgements, contained in these
terms and conditions;
5. in the case of any New Ordinary Shares subscribed for by it
as a financial intermediary, as that term is used in Article 5(1)
of the Prospectus Regulation and/or Article 5(1) of the UK
Prospectus Regulation, that: (i) the New Ordinary Shares subscribed
for by it in the Equity Placings will not be subscribed for on a
non-discretionary basis on behalf of, nor will they be subscribed
for with a view to their offer or resale to persons in a member
state of the EEA, other than to Qualified Investors, or persons in
the UK, other than to Relevant Persons, or in circumstances which
may give rise to an offer of securities to the public other than an
offer or resale in a member state of the EEA to Qualified Investors
or in the UK to Relevant Persons, or in circumstances in which the
prior consent of the Joint Bookrunners has been given to each such
proposed offer or resale; or (ii) where the New Ordinary Shares
have been subscribed for by it on behalf of persons in any member
state of the EEA, other than Qualified Investors, or in the UK,
other than Relevant Persons, the offer of those New Ordinary Shares
to it is not treated under the Prospectus Regulation and/or the UK
Prospectus Regulation as having been made to such persons;
6. it understands (or, if acting for the account of another
person, such person understands) the resale and transfer
restrictions set out in these terms and conditions; and
7. it is and, at the time the New Ordinary Shares are subscribed
for, will be either: (A) outside the United States, and subscribing
the New Ordinary Shares in an offshore transaction in accordance
with Rule 903 and Rule 904 of Regulation S; or (B) inside the
United States and a "qualified institutional buyer" that is
acquiring shares in a transaction not involving any public offering
pursuant to Section 4(a)(2) of the Securities Act, or pursuant to
another exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act, in each case, for
its own account or purchasing the New Ordinary Shares for an
account with respect to which it exercises sole investment
discretion, and has signed and returned a US Open Offer Investor
Letter or US Placing Investor Letter, as applicable.
These terms and conditions do not constitute an offer to sell or
issue or the invitation or solicitation of an offer to buy New
Ordinary Shares in the United States or any other jurisdiction
where to do so may be unlawful, including, without limitation,
Australia, its territories and possessions, Canada, Japan, South
Africa, or any other Excluded Territory.
These terms and conditions and the information contained herein
are not for release, publication or distribution, directly or
indirectly, in whole or in part, to persons in the United States or
any other jurisdiction where to do so may be unlawful, including,
without limitation, Australia, its territories and possessions,
Canada, Japan, South Africa, or any other Excluded Territory.
In particular, the New Ordinary Shares referred to in these
terms and conditions have not been and will not be registered under
the Securities Act or the securities laws of any state or other
jurisdiction of the United States and the New Ordinary Shares may
not be offered, sold, resold, pledged or otherwise transferred,
directly or indirectly, in, into or within 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 accordance with any applicable state securities laws. There will
be no public offering of the New Ordinary Shares in the United
States. The New Ordinary Shares have not been approved or
disapproved by the US Securities and Exchange Commission, or state
securities commission in the United States or any other regulatory
authority in the United States, nor have any of the foregoing
authorities passed upon or endorsed the merits of the Equity
Placings or the accuracy or adequacy of these terms and conditions.
Any representation to the contrary is a criminal offence in the
United States.
The distribution of these terms and conditions and the offer
and/or placing of New Ordinary Shares in certain other
jurisdictions may be restricted by law. No action has been taken by
Rothschild & Co, the Joint Bookrunners or the Company that
would permit an offer of the New Ordinary Shares or possession or
distribution of these terms and conditions or any other offering or
publicity material relating to the New Ordinary Shares in any
jurisdiction where action for that purpose is required, save as
mentioned above. Persons into whose possession these terms and
conditions come are required by the Joint Bookrunners and the
Company to inform themselves about and to observe any such
restrictions.
Each Placee's commitments will be made solely on the basis of
the information set out in this Announcement and the Placing Proof.
Each Placee, by participating in the Equity Placings, agrees that
it has neither received nor relied on any other information,
representation, warranty or statement made by or on behalf of
Rothschild & Co, either of the Joint Bookrunners or the Company
and none of Rothschild & Co, the Joint Bookrunners, the
Company, or any person acting on such person's behalf nor any of
their respective Affiliates has or shall have liability for any
Placee's decision to accept this invitation to participate in the
Equity Placings 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
Equity Placings. Nothing in this paragraph shall exclude the
liability of any person for fraudulent misrepresentation.
No undertaking, representation, warranty or any other assurance,
express or implied, is made or given by or on behalf of Rothschild
& Co, either Joint Bookrunner any of their respective
Affiliates, their respective directors, officers, employees,
representatives, agents, advisers, or any other person, as to the
accuracy, completeness, correctness or fairness of the information
or opinions contained in the Placing Proof and the Prospectus (when
published), this Announcement or for any other statement made or
purported to be made by any of them, or on behalf of them, in
connection with the Company or the Equity Placings and no such
person shall have any responsibility or liability for any such
information or opinions or for any errors or omissions.
Accordingly, save to the extent permitted by law, no liability
whatsoever is accepted by Rothschild & Co, either Joint
Bookrunner or any of their respective directors, officers,
employees or Affiliates or any other person for any loss howsoever
arising, directly or indirectly, from any use of this Announcement
or such information or opinions contained herein or otherwise
arising in connection with the Placing Proof and the Prospectus
(when published).
These terms and conditions do not constitute or form part of,
and should not be construed as, any offer or invitation to sell or
issue, or any solicitation of any offer to purchase any New
Ordinary Shares or any other securities or an inducement to enter
into investment activity, nor shall these terms and conditions (or
any part of them), nor the fact of their distribution, form the
basis of, or be relied on in connection with, any investment
activity. No statement in this Announcement is intended to be nor
may be construed as a profit forecast and nor should any such
statement be interpreted to mean that the Company's profits or
earnings per share for any future period will necessarily match or
exceed historical published profits or earnings per share of the
Company.
Proposed Firm Placing of Firm Placing Shares and Placing of Open
Offer Shares subject to clawback in respect of valid applications
by Qualifying Shareholders pursuant to the Open Offer
Placees are referred to these terms and conditions, this
Announcement and the Placing Proof containing details of, among
other matters, the Equity Placings. These terms and conditions,
this Announcement and the Placing Proof have been prepared and
issued by the Company, and each of these documents is the sole
responsibility of the Company.
The issue of the New Ordinary Shares is to be effected by way of
a cash box placing. The Company will allot the New Ordinary Shares
to Placees in consideration for the transfer to the Company by
Numis of certain shares in a Jersey incorporated subsidiary of the
Company, certain of which shares in the Jersey company Numis shall
be obliged to subscribe for using the proceeds of the Equity
Placings.
Applications will be made to the FCA for admission of the New
Ordinary Shares to listing on the premium listing segment of the
Official List of the FCA and to the London Stock Exchange for
admission of the New Ordinary Shares to trading on its main market
for listed securities.
Firm Placing
The Firm Placing Shares are not subject to clawback and do not
form part of the Placing and Open Offer. The Firm Placing is
subject to the same conditions and termination rights which apply
to the Placing and Open Offer.
The Joint Bookrunners have severally agreed, pursuant to the
Placing Agreement, as agent for the Company, to use their
respective reasonable endeavours to procure Firm Placees for the
Firm Placing Shares at the Issue Price. The Firm Placing is being
fully underwritten by the Joint Bookrunners on, and subject to, the
terms of the Placing Agreement. To the extent that the Joint
Bookrunners fail to procure Firm Placees for any Firm Placing
Shares, or any Firm Placee fails pay for any Firm Placing Shares
which have been allocated to it in the Firm Placing, the Joint
Bookrunners have severally agreed, on the terms and subject to the
conditions in the Placing Agreement, to take up such Firm Placing
Shares at the Issue Price.
Subject to the conditions below being satisfied, it is expected
that Admission will become effective on 18 June 2021 and that
dealings in the Firm Placing Shares will commence at 8.00 a.m. on
the same day. The Firm Placing Shares, when issued and fully paid,
will be identical to, and rank pari passu with, the Existing
Ordinary Shares, including the right to receive all dividends and
other distributions declared, made or paid on the Existing Ordinary
Shares by reference to a record date on or after Admission.
Placing and Open Offer
The Joint Bookrunners have severally agreed, pursuant to the
Placing Agreement, as agent for the Company, to use their
respective reasonable endeavours to procure Conditional Placees for
the Open Offer Shares at the Issue Price. The commitments of the
Conditional Placees in the Placing in respect of the Open Offer
Shares are subject to clawback in respect of valid applications for
Open Offer Shares by Qualifying Shareholders pursuant to the Open
Offer. The Placing is being fully underwritten by the Joint
Bookrunners on, and subject to, the terms and conditions of the
Placing Agreement. To the extent that there are Open Offer Shares
for which valid applications have not been received from Qualifying
Shareholders and the Joint Bookrunners fail to procure Conditional
Placees for such Open Offer Shares or if any Conditional Placee
procured by the Joint Bookrunners fails to pay for such Open Offer
Shares which have been allocated to it in the Placing, the Joint
Bookrunners have severally agreed, on the terms and subject to the
conditions in the Placing Agreement, to take up such Open Offer
Shares at the Issue Price.
Qualifying Shareholders are being given the opportunity to apply
for the Open Offer Shares at the Issue Price on and subject to the
terms and conditions of the Open Offer, pro rata to their holdings
of Existing Ordinary Shares on the Record Date. Fractions of New
Ordinary Shares will not be allotted and each Qualifying
Shareholder's entitlement to apply for Open Offer Shares under the
Open Offer will be rounded down to the nearest whole number.
The Open Offer Shares issued under the Placing and Open Offer,
when issued and fully paid, will be identical to, and rank pari
passu with, the Existing Ordinary Shares, including the right to
receive all dividends and other distributions declared, made or
paid on the Existing Ordinary Shares after Admission.
Subject to the conditions below being satisfied, it is expected
that Admission will become effective on 18 June 2021 and that
dealings in the Open Offer Shares will commence at 8.00 a.m. on the
same day.
Conditionality of the Equity Placings
The Equity Placings are conditional, inter alia, upon:
(i) the passing without amendment of the Resolutions by
Shareholders at the General Meeting;
(ii) Admission becoming effective by not later than 8.00 a.m. on
18 June 2021 (or such later time and/or date (being not later than
3.00 p.m. on 25 June 2021) as the Company, Rothschild & Co and
the Joint Bookrunners may agree);
(iii) the Placing Agreement having become unconditional in all respects; and
(iv) completion under the sale and purchase agreement relating
to the Kier Living Disposal having occurred (including the Company
having received the proceeds due to it in respect of the Kier
Living Disposal).
The full terms and conditions of the Open Offer will be
contained in Part III of the Prospectus to be issued by the Company
in connection with the Firm Placing and Placing and Open Offer and
Admission. The Prospectus to be issued by the Company will 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.
Bookbuild of the Equity Placings
The Joint Bookrunners are conducting the Bookbuild to determine
demand for participation in the Equity Placings. The Joint
Bookrunners will seek to procure Placees as agent for the Company
as part of the Bookbuild pursuant to the terms of the Placing
Agreement. These terms and conditions give details of the terms and
conditions of, and the mechanics of Placee participation in, the
Equity Placings.
The Joint Bookrunners and the Company shall be entitled to
effect the Equity Placings by such alternative method to the
Bookbuild as they may agree between them.
Principal terms of the Bookbuild
a. By participating in the Equity Placings, Placees will be
deemed to have read and understood this Announcement, these terms
and conditions and the Placing Proof in their entirety and to be
participating and making an offer for any New Ordinary Shares on
these terms and conditions, and to be providing the
representations, warranties, indemnities, agreements,
acknowledgements and undertakings, contained in these terms and
conditions.
b. The Joint Bookrunners are arranging the Equity Placings
severally, and not jointly, nor jointly and severally, as agents of
the Company.
c. Participation in the Equity Placings will only be available
to persons who are, in the EEA, Qualified Investors or, in the UK,
Relevant Persons, and who may lawfully be and are invited to
participate by either of the Joint Bookrunners. The Joint
Bookrunners and their respective Affiliates are entitled to enter
bids as principal in the Bookbuild.
d. To bid in the Bookbuild, Placees should communicate their bid
by telephone or in writing to their usual sales contact at either
Joint Bookrunner. Each bid should state the aggregate number of
Firm Placing Shares and Open Offer Shares which the Placee wishes
to subscribe for or the total monetary amount which it wishes to
commit to subscribe for New Ordinary Shares, in each case at the
Issue Price. Bids may be scaled down by the Joint Bookrunners on
the basis referred to in paragraph (l) below.
e. Allocations of New Ordinary Shares will be made in a
combination that reflects an approximately 1:1 ratio of Firm
Placing Shares to Open Offer Shares.
f. The Bookbuild is expected to close no later than noon 13 May
2021 but may close earlier or later, at the discretion of the Joint
Bookrunners and the Company. The timing of the closing of the books
and allocations will be agreed between the Joint Bookrunners and
the Company. The Joint Bookrunners may, in agreement with the
Company, accept offers to subscribe for New Ordinary Shares that
are received after the Bookbuild has closed.
g. An offer to subscribe for New Ordinary Shares in the
Bookbuild will be made on the basis of these terms and conditions
(which shall be deemed to be incorporated in such offer) and the
Placing Proof and will be legally binding on the Placee by which,
or on behalf of which, it is made and will not be capable of
variation or revocation.
h. Subject to paragraph (f) above, the Joint Bookrunners reserve
the right not to accept an offer to subscribe for New Ordinary
Shares, either in whole or in part, on the basis of allocations
agreed with the Company and may scale down any offer to subscribe
for New Ordinary Shares for this purpose.
i. If successful, each Placee's allocation will be confirmed to
it by the Joint Bookrunners following the close of the Bookbuild.
Oral or written confirmation (at the Joint Bookrunners' discretion)
from the Joint Bookrunners to such Placee confirming its allocation
will constitute a legally binding commitment upon such Placee (who
at that point will become a Placee), in favour of the Joint
Bookrunners and the Company to subscribe for the number of New
Ordinary Shares allocated to it (and in the respective numbers of
Firm Placing Shares and Open Offer Shares (subject to clawback) so
allocated) on the terms and conditions set out herein (which shall
be deemed to be incorporated in such legally binding commitment).
Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to the Joint Bookrunners, to pay to the
Joint Bookrunners (or as the Joint Bookrunners may direct) as
agents for the Company in cleared funds an amount equal to the
product of the Issue Price and the sum of the number of Firm
Placing Shares and, once apportioned after clawback (in accordance
with the procedure described in the paragraph entitled "Placing
Procedure" below), the Open Offer Shares, for which such Placee has
agreed to subscribe.
j. Each Placee's allocation and commitment together with
settlement arrangements will be confirmed by an electronic contract
note and/or electronic trade confirmation issued to such Placee by
one of the Joint Bookrunners in due course. The contract note or
trade confirmation will include the payment and settlement
procedures to be followed by Placees in connection with their
acquisition of the New Ordinary Shares.
k. The Company will make a further announcement following the
completion of the Bookbuild. It is expected that such announcement
will be made as soon as practicable after the close of the
Bookbuild.
l. The Joint Bookrunners reserve the right not to accept bids or
to accept bids, either in whole or in part, on the basis of
allocations determined by the Joint Bookrunners and the Company.
The Joint Bookrunners may scale down any bids as they may determine
to be necessary or desirable, subject to agreement with the
Company. The acceptance of bids shall be at the Joint Bookrunners'
absolute discretion, subject to agreement with the Company.
m. Irrespective of the time at which a Placee's allocation(s)
pursuant to the Equity Placings is/are confirmed, settlement for:
(i) all Firm Placing Shares to be subscribed for pursuant to the
Firm Placing will be required to be made at the time specified; and
(ii) all Open Offer Shares to be subscribed for pursuant to the
Placing will be required to be made at the later time specified, on
the basis explained below under the paragraph entitled
"Registration and Settlement".
n. By participating in the Bookbuild, each Placee agrees that
its rights and obligations in respect of the Firm Placing and/or
the Placing will terminate only in the circumstances described
below and will not be capable of rescission or termination by the
Placee. All obligations under the Equity Placings will be subject
to the fulfilment of the conditions referred to below under the
paragraph entitled "Conditions of the Equity Placings and
Termination of the Placing Agreement".
o. To the fullest extent permissible by law, none of Rothschild
& Co, the Joint Bookrunners, the Company, any of their
respective Affiliates nor any of its or their respective
Affiliates' agents, directors, officers or employees, respectively,
shall have any liability to Placees (or to any other person whether
acting on behalf of a Placee or otherwise). In particular, neither
Rothschild & Co, the Joint Bookrunners nor any of their
respective Affiliates nor any of its or their respective
Affiliates' agents, directors, officers or employees, respectively,
shall have any liability (including, to the extent permissible by
law, any fiduciary duties) to Placees (or to any person whether
acting on behalf of a Placee or otherwise) in respect of the Joint
Bookrunners' conduct of the Bookbuild or of such alternative method
of effecting the Equity Placings as the Joint Bookrunners and the
Company may agree.
Conditions of the Equity Placings
Placees will only be called on to complete their agreed
acquisitions of New Ordinary Shares if the obligations of the Joint
Bookrunners under the Placing Agreement have become unconditional
in all respects and the Joint Bookrunners have not terminated the
Placing Agreement prior to Admission.
The Joint Bookrunners' and Rothschild & Co's obligations
under the Placing Agreement in respect of the Firm Placing and the
Placing and Open Offer are conditional upon, inter alia:
(a) the Prospectus having been approved by the FCA and published
in accordance with the Listing Rules and the Prospectus Regulation
Rules by no later than 5.00 p.m. on 13 May 2021 (or such later time
and/or date as Rothschild & Co and the Joint Bookrunners may
agree with the Company);
(b) Admission occurring at or before 8.00 a.m. on 18 June 2021
(or such later time and/or date (being not later than 3.00 p.m. on
25 June 2021) as the Company, Rothschild & Co and the Joint
Bookrunners may agree);
(c) the passing without amendment of the Resolutions at the
General Meeting on 16 June 2021 (or at any adjournment thereof, or
such later date as the Company, Rothschild & Co and the Joint
Bookrunners may agree) and the Resolutions remaining in force;
and
(d) completion under the sale and purchase agreement relating to
the Kier Living Disposal having occurred (including the Company
having received the proceeds due to it in respect of the Kier
Living Disposal).
If any Condition has not been satisfied, has not been waived by
the Joint Bookrunners or has become incapable of being satisfied
(and is not waived by the Joint Bookrunners as described below) or
if the Placing Agreement is terminated, all obligations under these
terms and conditions will automatically terminate.
The Joint Bookrunners may in their absolute discretion in
writing waive fulfilment of certain of the Conditions in the
Placing Agreement or extend the time provided for fulfilment of
such Conditions. Any such extension or waiver will not affect
Placees' commitments as set out in these terms and conditions.
Neither the Company, Rothschild & Co nor either Joint
Bookrunner 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 made by the Joint Bookrunners as to whether
or not to waive or to extend the time and/or date for the
fulfilment of any condition in the Placing Agreement and/or whether
or not to exercise any such termination right.
Termination of the Placing Agreement
The Joint Bookrunners are entitled, at any time before
Admission, to terminate the Placing Agreement in accordance with
its terms in certain circumstances, including, inter alia: (i) if
there has been a breach by the Company of any of the warranties or
any failure by the Company to perform any of its obligations
contained in the Placing Agreement; (ii) if there has been a
material adverse change in relation to the Group; (iii) if the
application for Admission is withdrawn or refused by the FCA or the
London Stock Exchange; or (iv) upon the occurrence of certain force
majeure events.
By participating in the Equity Placings, each Placee agrees that
its rights and obligations hereunder are conditional upon the
Placing Agreement becoming unconditional in all respects in respect
of the Firm Placing (in respect of Firm Placing Shares subscribed
for under the Firm Placing) and/or in respect of the Placing (in
respect of Open Offer Shares subscribed for under the Placing) and
that its rights and obligations will terminate only in the
circumstances described above and will not be capable of rescission
or termination by it after oral or written confirmation by the
Joint Bookrunners (at the Joint Bookrunners' discretion) following
the close of the Bookbuild.
By participating in the Equity Placings each Placee agrees that
the exercise by the Company or either Joint Bookrunner of any right
or other discretion under the Placing Agreement shall be within the
absolute discretion of the Company and each Joint Bookrunner (as
the case may be) and that neither the Company nor either Joint
Bookrunner need make any reference to such Placee (or to any other
person whether acting on behalf of any Placee or otherwise) and
that neither the Company nor either Joint Bookrunner shall have any
liability to such Placee (or to any other person whether acting on
behalf of any Placee or otherwise) whatsoever in connection with
any such exercise.
Withdrawal Rights
Placees acknowledge that their acceptance of any of the New
Ordinary Shares is not by way of acceptance of the public offer
made in the Prospectus and (if applicable) the Application Form/US
Open Offer Investor Letter or the US Placing Investor Letter (as
applicable) but is by way of a collateral contract and as such
Article 23(2) of the UK Prospectus Regulation does not entitle
Placees to withdraw in the event that the Company publishes a
supplementary prospectus in connection with the Capital Raise or
Admission. If, however, a Placee is entitled to withdraw, by
accepting the offer of a placing participation, the Placee agrees
to confirm their acceptance of the offer on the same terms
immediately after such right of withdrawal arises.
Placing Procedure
Placees shall subscribe for the Firm Placing Shares and Open
Offer Shares to be issued pursuant to the Equity Placings (subject
to clawback to satisfy valid applications by Qualifying
Shareholders) and any allocation of the Firm Placing Shares and
Open Offer Shares (subject to clawback to satisfy valid
applications by Qualifying Shareholders) to be issued pursuant to
the Equity Placings, and such allocations will be notified to them
on or around noon on 13 May 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 Open Offer Shares only to the extent that valid
applications by Qualifying Shareholders:
(a) under the Open Offer are not received by 11.00 a.m. on 14 June 2021; or
(b) have otherwise not been deemed to be valid in accordance
with the terms and conditions of the Open Offer set out in the
Prospectus and the Application Form/US Open Offer Investor Letter
or US Placing Investor Letter (as applicable).
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 Forms, the
US Investor Open Offer Investor Letter or the US Placing Investor
Letter (as applicable) or the publication of a supplementary
prospectus or otherwise.
Registration and Settlement
Settlement of transactions in the New Ordinary Shares following
Admission will take place within the CREST system, subject to
certain exceptions. The Joint Bookrunners and the Company reserve
the right to require settlement for, and delivery of, the New
Ordinary Shares to Placees by such other means that they deem
necessary if delivery or settlement is not possible within the
CREST system within the timetable set out in the Placing Proof
and/or Prospectus (when published) or would not be consistent with
the regulatory requirements in the Placee's jurisdiction. Each
Placee will be deemed to agree that it will do all things necessary
to ensure that delivery and payment is completed in accordance with
either the standing CREST or certificated settlement instructions
which they have in place with the relevant Joint Bookrunner.
Placees should note the longer than usual settlement period for
a firm placing and open offer and be aware of the extended
timetable as set out in the Placing Proof and, when published, the
Prospectus. Settlement for the Equity Placings will be on a T+2 and
delivery versus payment basis, with T being the date of the General
Meeting. Settlement is expected to take place on or around 18 June
2021, the business day after the General Meeting, with contract
notes despatched following the General Meeting.
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
New Ordinary Shares allocated to it on its behalf and retain from
the proceeds, for its own account and benefit, an amount equal to
the aggregate amount owed by the Placee. By communicating a bid for
New Ordinary Shares, each Placee confers on the Joint Bookrunners
all such authorities and powers necessary to carry out any such
sale and agrees to ratify and confirm all actions which the Joint
Bookrunners lawfully take in pursuance of such sale. The relevant
Placee will, however, remain liable for any shortfall below the
aggregate amount owed by it and may be required to bear any stamp
duty or stamp duty reserve tax which may arise upon any transaction
in the New Ordinary Shares on such Placee's behalf.
Acceptance
By participating in the Equity Placings, a Placee (and any
person acting on such Placee's behalf) irrevocably acknowledges,
confirms, undertakes, represents, warrants and agrees (as the case
may be) with Rothschild & Co, the Joint Bookrunners and the
Company, that:
1. in consideration of its allocation of a placing
participation, to subscribe for at the Issue Price any New Ordinary
Shares comprised in its allocation which it is required to
subscribe for pursuant to these terms and conditions, subject, in
respect of the Open Offer Shares only, to clawback in the Open
Offer in respect of valid applications from Qualifying Shareholders
in the Open Offer;
2. it has read and understood this Announcement (including these
terms and conditions) and the Placing Proof in their entirety and
that it has neither received nor relied on any information given or
any investigations, representations, warranties or statements made
at any time by any person in connection with Admission, the Equity
Placings, the Company, the New Ordinary Shares, or otherwise, other
than the information contained in this Announcement (including
these terms and conditions) and the Placing Proof that in accepting
the offer of its placing participation it will be relying solely on
the information contained in this Announcement (including these
terms and conditions) and the Placing Proof, receipt of which is
hereby acknowledged, and undertakes not to redistribute or
duplicate such documents;
3. its oral or written commitment will be made solely on the
basis of the information set out in this Announcement (including
these terms and conditions) and the Placing Proof, such information
being all that such Placee deems necessary or appropriate and
sufficient to make an investment decision in respect of the New
Ordinary Shares and that it has neither received nor relied on any
other information given, or representations or warranties or
statements made, by Rothschild & Co, either Joint Bookrunner or
the Company, or any of their respective Affiliates and none of
Rothschild & Co, the Joint Bookrunners, the Company, any of
their respective Affiliates or any person acting on behalf of any
such person will be liable for any Placee's decision to participate
in the Firm Placing and/or the Placing based on any other
information, representation, warranty or statement;
4. the contents of this Announcement, these terms and conditions
and the Placing Proof are exclusively the responsibility of the
Company and it agrees that neither Rothschild & Co, the Joint
Bookrunners nor any of their respective Affiliates nor any person
acting on behalf of any of such persons will be responsible for or
shall have liability for any information, representation or
statements contained therein or any information previously
published by or on behalf of the Company, and neither Rothschild
& Co, the Joint Bookrunners, any of their respective Affiliates
nor any person acting on behalf of any such person will be
responsible or liable for a Placee's decision to accept its placing
participation;
5. (i) it has not relied on, and will not rely on, any
information relating to the Company contained or which may be
contained in any research report or investor presentation prepared
or which may be prepared by Rothschild & Co, either Joint
Bookrunner or any of their respective Affiliates or any person
acting on behalf of any such person; (ii) neither Rothschild &
Co, the Joint Bookrunners nor any of their respective Affiliates
nor any person acting on behalf of any of such persons has or shall
have any responsibility or liability for public information
relating to the Company; (iii) neither Rothschild & Co, the
Joint Bookrunners nor any of their respective Affiliates nor any
person acting on behalf of any of such persons has or shall have
any responsibility or liability for any additional information that
has otherwise been made available to it, whether at the date of
publication of such information, the date of these terms and
conditions or otherwise; and that (iv) neither Rothschild & Co,
the Joint Bookrunners nor any of their respective Affiliates nor
any person acting on behalf of any of such persons makes any
representation or warranty, express or implied, as to the truth,
accuracy or completeness of any such information referred to in (i)
to (iii) above, whether at the date of publication of such
information, the date of this Announcement or otherwise;
6. it has made its own assessment of the Company and has relied
on its own investigation of the business, financial or other
position of the Company in deciding to participate in the Equity
Placings, and has satisfied itself concerning the relevant tax,
legal, currency and other economic considerations relevant to its
decision to participate in the Firm Placing and/or the Placing;
7. it is acting as principal only in respect of the Equity
Placings or, if it is acting for any other person: (i) it is duly
authorised to do so and has full power to make the acknowledgments,
representations and agreements herein on behalf of each such
person; (ii) it is and will remain liable to the Company and the
Joint Bookrunners for the performance of all its obligations as a
Placee in respect of the Equity Placings (regardless of the fact
that it is acting for another person); (iii) if it is in the EEA,
it is a Qualified Investor and undertakes that it will subscribe
for, hold, manage or dispose of any New Ordinary Shares that are
allocated to it for the purposes of its business; and/or if it is a
financial intermediary, as that term is used in Article 5(1) of the
Prospectus Regulation, that (a) the New Ordinary Shares subscribed
for by it in the Equity Placings will not be subscribed for on a
non-discretionary basis for, or on behalf of, nor will they be
subscribed for with a view to their offer or resale to, persons in
a member state of the EEA other than Qualified Investors, or in
circumstances which may give rise to an offer of securities to the
public other than an offer or resale, in a member state of the EEA
to Qualified Investors, or in circumstances in which the prior
consent of the Joint Bookrunners has been given to each such
proposed offer or resale; or (b) where the New Ordinary Shares have
been subscribed for by it on behalf of persons in any member state
of the EEA other than Qualified Investors, the offer of those New
Ordinary Shares to it is not treated under the Prospectus
Regulation as having been made to such persons;
8. if it is in the United Kingdom, it is a Relevant Person and
undertakes that it will subscribed for, hold, manage or dispose of
any New Ordinary Shares that are allocated to it for the purposes
of its business; and/or if it is a financial intermediary, as that
term is used in Article 5(1) of the UK Prospectus Regulation, that
(a) the New Ordinary Shares subscribed for by it in the Equity
Placings will not be subscribed for on a non-discretionary basis
for, or on behalf of, nor will they be subscribed for with a view
to their offer or resale to, persons in the United Kingdom other
than Relevant Persons, or in circumstances which may give rise to
an offer of securities to the public other than an offer or resale,
in the United Kingdom to Relevant Persons, or in circumstances in
which the prior consent of the Joint Bookrunners has been given to
each such proposed offer or resale; or (b) where the New Ordinary
Shares have been subscribed for by it on behalf of persons in the
United Kingdom other than Relevant Persons, the offer of those New
Ordinary Shares to it is not treated under the UK Prospectus
Regulation as having been made to such persons
9. if it has received any "inside information" (as defined in
the market abuse regulation No. 596/2014 and/or the market abuse
regulation No. 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018) about the
Company in advance of the Equity Placings, it has not: (i) dealt in
the securities of the Company; (ii) encouraged or required another
person to deal in the securities of the Company; or (iii) disclosed
such information to any person, prior to the information being made
generally available;
10. it has complied with its obligations in connection with
money laundering and terrorist financing under the Regulations and,
if it is making payment on behalf of a third party, it has obtained
and recorded satisfactory evidence to verify the identity of the
third party as may be required by the Regulations;
11. it has only communicated or caused to be communicated and
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of FSMA) relating to the New Ordinary Shares in
circumstances in which section 21(1) of FSMA does not require
approval of the communication by an authorised person;
12. it is not acting in concert (within the meaning given in the
City Code on Takeovers and Mergers) with any other Placee or any
other person in relation to the Company;
13. it has complied and will comply with all applicable
provisions of the FSMA with respect to anything done by it in
relation to the New Ordinary Shares in, from or otherwise involving
the United Kingdom;
14. a communication that the Equity Placings or the book is
"covered" (i.e. indicated demand from investors in the book equals
or exceeds the amount of the securities being offered) is not any
indication or assurance that the book will remain covered or that
the Equity Placings and securities will be fully distributed by the
Joint Bookrunners. Each of the Joint Bookrunners reserve the right
to take up a portion of the securities in the Equity Placings as a
principal position at any stage at their sole discretion, inter
alia, to take account of the Company's objectives, MiFID II (as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018) requirements and/or their allocation
policies;
15. it and any person acting on its behalf is entitled to
subscribe for the New Ordinary Shares under the laws of all
relevant jurisdictions and that it has all necessary capacity and
has obtained all necessary consents and authorities to enable it to
commit to this participation in the Equity Placings and to perform
its obligations in relation thereto (including, without limitation,
in the case of any person on whose behalf it is acting, all
necessary consents and authorities to agree to the terms set out or
referred to in these terms and conditions);
16. unless otherwise agreed by the Company (in agreement with
the Joint Bookrunners), it is not, and at the time the New Ordinary
Shares are subscribed for will not be, subscribing for and on
behalf of a resident of the United States (subject to certain
exceptions listed below in "Selling Restrictions") or any other
jurisdiction where to do so may be unlawful, including, without
limitation of Australia, its territories and possessions, Canada,
Japan, South Africa, or any other Excluded Territory and further
acknowledges that the New Ordinary Shares have not been and will
not be registered under the securities legislation of any Excluded
Territory and, subject to certain exceptions, may not be offered,
sold, transferred, delivered or distributed, directly or
indirectly, in or into those jurisdictions;
17. it agrees that Rothschild & Co and the Joint Bookrunners
shall have no duties or responsibilities towards it for providing
protections afforded to their respective clients under the Rules or
for advising it with regard to the New Ordinary Shares and that it
is not, and will not be, a client of Rothschild & Co or of
either Joint Bookrunner as defined by the Rules. Likewise, any
payment by it will not be treated as client money governed by the
Rules;
18. any exercise by a Joint Bookrunner of any right to terminate
the Placing Agreement or of other rights or discretions under the
Placing Agreement or the Equity Placings shall, subject to the
applicable terms of the Placing Agreement, be within that Joint
Bookrunner's absolute discretion and neither Joint Bookrunner shall
have any liability to any Placee whatsoever in relation to any
decision to exercise or not to exercise any such right or the
timing thereof;
19. neither it, nor the person specified by it for registration
as a holder of New Ordinary Shares is, or is acting as nominee(s)
or agent(s) for, and that the New Ordinary Shares will not be
allotted to, a person/person(s) whose business either is or
includes issuing depository receipts or the provision of clearance
services and therefore that the issue to the Placee, or the person
specified by the Placee for registration as holder, of the New
Ordinary Shares will not give rise to a liability under any of
sections 67, 70, 93 and 96 of the Finance Act 1986 (depositary
receipts and clearance services) and that the New Ordinary Shares
are not being subscribed for in connection with arrangements to
issue depository receipts or to issue or transfer New Ordinary
Shares into a clearance system;
20. it has the funds available to pay for, and will make payment
to the Joint Bookrunners (or as the Joint Bookrunners may direct)
for, the New Ordinary 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 New
Ordinary Shares may be sold to or placed with other persons on such
terms as the Joint Bookrunners determine in their absolute
discretion without liability to the Placee and on the basis that
such Placee will remain liable for any shortfall below the net
proceeds of such sale and the placing proceeds of such New Ordinary
Shares and may be required to bear any stamp duty or stamp duty
reserve tax (together with any interest or penalties due pursuant
to the terms set out or referred to in this Announcement) which may
arise upon the sale of such Placee's New Ordinary Shares on its
behalf;
21. the person who it specifies for registration as holder of
the New Ordinary Shares will be (i) itself or (ii) its nominee, as
the case may be, and acknowledges that the Joint Bookrunners and
the Company will not be responsible for any liability to pay stamp
duty or stamp duty reserve tax (together with interest and
penalties) resulting from a failure to observe this requirement;
and each Placee and any person acting on behalf of such Placee
agrees to participate in the Equity Placings on the basis that the
New Ordinary Shares will be allotted to a CREST stock account of
one of the Joint Bookrunners who will hold them as nominee on
behalf of the Placee until settlement in accordance with its
standing settlement instructions with it;
22. where it is acquiring New Ordinary Shares for one or more
managed accounts, it is authorised in writing by each managed
account to subscribe for New Ordinary Shares for that managed
account;
23. if it is a pension fund or investment company, its
acquisition of any New Ordinary Shares is in full compliance with
applicable laws and regulations;
24. it has not offered or sold and will not offer or sell any
New Ordinary Shares to persons in any member state of the EEA or
the United Kingdom prior to Admission except to persons whose
ordinary activities involve them acquiring, holding, managing or
disposing of investments (as principal or agent) for the purpose of
their business or otherwise in circumstances which have not
resulted and will not result in an offer to the public in any
member state of the EEA or the United Kingdom within the meaning of
the Prospectus Regulation and/or the UK Prospectus Regulation;
25. to provide Rothschild & Co and the Joint Bookrunners
with such relevant documents as they may reasonably request to
comply with requests or requirements that either they or the
Company may receive from relevant regulators in relation to the
Equity Placings, subject to its legal, regulatory and compliance
requirements and restrictions;
26. any agreements entered into by it pursuant to these terms
and conditions shall be governed by and construed in accordance
with the laws of England and Wales and it submits (on its behalf
and on behalf of any Placee on whose behalf it is acting) to the
exclusive jurisdiction of the English courts as regards any claim,
dispute or matter arising out of any such contract, except that
enforcement proceedings in respect of the obligation to make
payment for the New Ordinary Shares (together with any interest
chargeable thereon) may be taken by 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;
27. to fully and effectively indemnify and hold harmless the
Company, Rothschild & Co and the Joint Bookrunners and each of
their respective Indemnified Persons from and against any and all
losses, claims, damages, liabilities and expenses (including legal
fees and expenses) (i) arising from any breach by such Placee of
any of the provisions of these terms and conditions and (ii)
incurred by any Indemnified Person arising from the performance of
the Placee's obligations as set out in these terms and
conditions;
28. in making any decision to subscribe for New Ordinary Shares:
(i) it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of acquiring the New Ordinary Shares; (ii) 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 Equity Placings; (iii) it has relied on its own examination,
due diligence and analysis of the Company and its Affiliates taken
as a whole (including the markets in which the Group operates) and
the terms of the Equity Placings (including the merits and risks
involved); (iv) it has had sufficient time to consider and conduct
its own investigation with respect to the offer and purchase of the
New Ordinary Shares, including the legal, regulatory, tax,
business, currency and other economic and financial considerations
relevant to such investment; and (v) will not look to Rothschild
& Co, the Joint Bookrunners, any of their respective Affiliates
or any person acting on their behalf for all or part of any such
loss or losses it or they may suffer;
29. Rothschild & Co, the Joint Bookrunners and the Company
and their respective Affiliates and others will rely upon the truth
and accuracy of the foregoing representations, warranties,
acknowledgments and undertakings which are irrevocable;
30. its allocation (if any) of New Ordinary Shares will
represent a maximum number of New Ordinary Shares to which it will
be entitled, and required, to subscribe for, and that the Joint
Bookrunners or the Company may call upon it to subscribe for a
lower number of New Ordinary Shares (if any) in particular as a
result of clawback of Open Offer Shares pursuant to the Open Offer
but in no event in aggregate more than the aforementioned
maximum;
31. it acknowledges and agrees that neither Rothschild & Co,
the Joint Bookrunners nor the Company owes any fiduciary or other
duties to it in respect of any representations, warranties,
undertakings or indemnities in the Placing Agreement;
32. it acknowledges that it irrevocably appoints any director or
authorised signatories of the Joint Bookrunners as its agent for
the purposes of executing and delivering to the Company and/or its
registrars any documents on its behalf necessary to enable it or
the Placees to be registered as the holder of any of the New
Ordinary Shares agreed to be taken up by it under the Equity
Placings;
33. its commitment to subscribe for New Ordinary Shares will
continue notwithstanding any amendment that may in future be made
to the terms and conditions of the Firm Placing and/or 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 Firm Placing and/or the Placing;
and
34. each of Rothschild & Co, the Joint Bookrunners and their
respective Affiliates may have engaged in transactions with, and
provided various commercial banking, investment banking, financial
advisory transactions and services in the ordinary course of their
business with the Company and/or its affiliates for which they
would have received customary fees and commissions. Each of
Rothschild & Co, the Joint Bookrunners and their respective
Affiliates may provide such services to the Company and/or its
affiliates in the future.
Please also note that the agreement to allot and issue New
Ordinary Shares to Placees (or the persons for whom Placees are
contracting as agent) free of stamp duty and stamp duty reserve tax
in the UK relates only to their allotment and issue to Placees, or
such persons as they nominate as their agents, direct from the
Company for the New Ordinary Shares in question. Such agreement
assumes that such New Ordinary Shares are not being subscribed for
in connection with arrangements to issue depositary receipts or to
transfer such New Ordinary Shares into a clearance service. If
there were any such arrangements, or the settlement related to
other dealing in such New Ordinary Shares, stamp duty or stamp duty
reserve tax may be payable, for which neither the Company,
Rothschild & Co, nor the Joint Bookrunners would be responsible
and Placees shall indemnify the Company, Rothschild & Co and
the Joint Bookrunners on an after-tax basis for any stamp duty or
stamp duty reserve tax paid by them in respect of any such
arrangements or dealings. Furthermore, each Placee agrees to
indemnify on an after-tax basis and hold each of Rothschild &
Co, the Joint Bookrunners and/or the Company and their respective
Affiliates harmless from any and all interest, fines or penalties
in relation to stamp duty, stamp duty reserve tax and all other
similar duties or taxes to the extent that such interest, fines or
penalties arise from the unreasonable default or delay of that
Placee or its agent. If this is the case, it would be sensible for
Placees to take their own advice and they should notify the
relevant Joint Bookrunner 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 UK by them or
any other person on the acquisition by them of any New Ordinary
Shares or the agreement by them to subscribe for any New Ordinary
Shares.
Selling Restrictions
By participating in the Equity Placings, a Placee (and any
person acting on such Placee's behalf) irrevocably acknowledges,
confirms, undertakes, represents, warrants and agrees (as the case
may be) with each of Rothschild & Co, the Joint Bookrunners and
the Company, the following:
1. it is not a person who has a registered address in, or is a
resident, citizen or national of, a country or countries, in which
it is unlawful to make or accept an offer to subscribe for New
Ordinary Shares;
2. it has fully observed and will fully observe the applicable
laws of any relevant territory, including complying with the
selling restrictions set out herein and obtaining any requisite
governmental or other consents and it has fully observed and will
fully observe any other requisite formalities and pay any issue,
transfer or other taxes due in such territories;
3. if it is in the United Kingdom, it is a Relevant Person;
4. if it is in a member state of the EEA, it is a Qualified Investor;
5. it is a person whose ordinary activities involve it (as
principal or agent) in acquiring, holding, managing or disposing of
investments for the purpose of its business and it undertakes that
it will (as principal or agent) subscribe for, hold, manage or
dispose of any New Ordinary Shares that are allocated to it for the
purposes of its business; and
6. it is and, at the time the New Ordinary Shares are purchased,
will be either: (A) outside the United States, purchasing in an
offshore transaction within the meaning of, and pursuant to,
Regulation S; or (B) inside the United States and (i) a "qualified
institutional buyer" that is acquiring shares in a transaction not
involving any public offering pursuant to Section 4(a)(2) of the
Securities Act, or pursuant to another exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act, and (ii) has signed and returned a US Open Offer
Investor Letter or US Placing Investor Letter (as applicable);
7. none of the New Ordinary Shares have been or will be
registered under the Securities Act or with any securities
regulatory authority of any state or other jurisdiction of the
United States; and
8. it (on its behalf and on behalf of any Placee on whose behalf
it is acting) has: (a) fully observed the laws of all relevant
jurisdictions which apply to it; (b) obtained all governmental and
other consents which may be required; (c) fully observed any other
requisite formalities; (d) paid or will pay any issue, transfer or
other taxes; (e) not taken any action which will or may result in
the Company or either Joint Bookrunner being in breach of a legal
or regulatory requirement of any territory in connection with the
Equity Placings; (f) obtained all other necessary consents and
authorities required to enable it to give its commitment to
subscribe for the relevant New Ordinary Shares; and (g) the power
and capacity to, and will, perform its obligations under the terms
contained in these terms and conditions.
Miscellaneous
If a Placee is entitled to participate in the Open Offer by
virtue of being a Qualifying Shareholder it will be able to apply
to subscribe for Open Offer Shares under the terms and conditions
of the Open Offer.
The Company reserves the right to treat as invalid any
application or purported application for New Ordinary Shares that
appears to the Company or its agents to have been executed,
effected or dispatched from the United States or any Excluded
Territory or in a manner that may involve a breach of the laws or
regulations of any jurisdiction or if the Company or its agents
believe that the same may violate applicable legal or regulatory
requirements or if it provides an address for delivery of the share
certificates of New Ordinary Shares in, or in the case of a credit
of Open Offer Entitlements to a stock account in CREST, to a CREST
member whose registered address would be in, the United States, any
other Excluded Territory or any other jurisdiction outside the
United Kingdom in which it would be unlawful to deliver such share
certificates or make such a credit.
When a Placee or person acting on behalf of the Placee is
dealing with either of the Joint Bookrunners, any money held in an
account with either of the Joint Bookrunners 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 rules and
regulations of the FCA made under the FSMA. The Placee acknowledges
that the money will not be subject to the protections conferred by
the client money rules; as a consequence, this money will not be
segregated from the Joint Bookrunners' money in accordance with the
client money rules and will be used by each Joint Bookrunner in the
course of its own business; and the Placee will rank only as a
general creditor of the relevant Joint Bookrunner.
Times
Unless the context otherwise requires, all references to time
are to London time. All times and dates in these terms and
conditions may be subject to amendment. The Joint Bookrunners will
notify Placees and any persons acting on behalf of the Placees of
any changes.
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END
IOEUOOVRAOUVARR
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