TIDMTHAL TIDMLSR
RNS Number : 8891T
Thalassa Holdings Limited
25 March 2019
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
IN PARTICULAR, THIS ANNOUNCEMENT SHOULD NOT BE RELEASED, PUBLISHED,
DISTRIBUTED, FORWARDED OR TRANSMITTED, IN WHOLE OR IN PART, IN,
INTO OR FROM ANY RESTRICTED JURISDICTION, INCLUDING THE UNITED
STATES.
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS OR
PROSPECTUS EQUIVALENT DOCUMENT AND NO INVESTMENT DECISION IN
RELATION TO THE OFFER OR THE THALASSA CONSIDERATION SHARES SHOULD
BE MADE EXCEPT ON THE BASIS OF INFORMATION IN THE OFFER DOCUMENT
AND PROSPECTUS EQUIVALENT DOCUMENT.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014.
FOR IMMEDIATE RELEASE
25 March 2019
Thalassa Holdings Ltd
("Thalassa" or the "Company")
Response to LSR announcement
Time to focus on the facts:
The Offer represents an attractive exit opportunity for
beleaguered LSR Shareholders
The Share Buy-back Programme offers post transaction
liquidity
There is NO certainty of exit through LSR's opaque, costly and
open-ended alternative proposal
The Thalassa Board notes the announcement made by LSR on 21
March 2019 in response to Thalassa's announcement of 19 March
2019.
Whether the LSR Board acknowledges it or not, the Offer
represents a deliverable and certain exit at an attractive value of
35.7 pence per Offer Share. The Thalassa Board believes that this
value is in excess of any potential return that LSR Shareholders
may receive from the LSR Board's unquantified, potentially costly
and, in the Thalassa Board's opinion, risky liquidation strategy.
Thalassa believes that the LSR proposal is certain only insofar
that it will entail additional unquantified costs which will only
erode LSR Shareholder value further and yet again reduce LSR's
already shattered NAV.
Thalassa believes that the Offer is the best possible
alternative for LSR Shareholders to receive fair value for their
LSR Shares after having seen the value of their investment continue
to decline, as it has every year since inception.
LSR Shareholders are invited to accept the Offer. The Offer is
both: (i) at a premium to LSR's current share price; and (ii)
importantly, at a value higher than the historical net realisable
value of LSR of 33p to 34.5p per LSR Share (which itself has been
undermined by previous cautionary statements by LSR and the passing
of time).
Thalassa is flabbergasted that the LSR Board has apparently
spent a significant amount of shareholder funds in an attempt to
persuade LSR Shareholders to reject a compelling liquidity
opportunity and cannot understand how doing so is consistent with
LSR's strategy of bringing a return to LSR Shareholders.
Thalassa is the largest shareholder in LSR. The Thalassa Board
urges LSR Shareholders to follow Thalassa's example and take
control of their investment in LSR by accepting the Offer, which
represents, in the opinion of the Thalassa Board:
1. an attractive value with upside potential through the
Thalassa Consideration Shares (Thalassa Shares currently trade at a
discount to NAV);
2. a clear liquidity opportunity, with cash as an important part of the total consideration; and
3. for those LSR Shareholders who do not wish to hold their
Thalassa Consideration Shares, the opportunity to participate in
the Share Buy-back Programme described below.
Share Buy-back Programme
The Thalassa Board has pursued an active share buy-back
programme (the "Programme") for a number of years, which it
believes has substantially enhanced Thalassa's book value per share
for ALL Thalassa Shareholders.
Since Thalassa commenced buying back its shares, it has
repurchased nearly 8 million shares or approximately 30% of its
entire issued share capital (including shares held in treasury). In
the Thalassa Board's opinion, this is a prudent use of capital
based on the discounted price of Thalassa Shares to its NAV and is
therefore beneficial to all of its shareholders.
The Thalassa Board has committed (as a post-offer intention
statement under the Takeover Code) to maintain the Programme
following completion of the Offer and until at least such time as
the full GBP6 million has been utilised. The Thalassa Board will at
such time consider whether to renew the Programme again, if such a
course of action is in the interests of all Thalassa
Shareholders.
The Programme will continue to provide liquidity for Thalassa
Shareholders, including LSR Shareholders who accept our offer but
do not wish to hold the Thalassa Consideration Shares issued to
them as part of the Offer.
Thalassa wishes to emphasise to Thalassa and LSR Shareholders
that this is a "post-offer intention statement" to which Rule 19.6
of the Code applies. Thalassa is willing to attribute this weight
to the statement in connection with its Offer.
Thalassa is authorised to buy-back Thalassa Shares with a total
value of up to GBP6.0 million. Based on the Closing Price of a
Thalassa Share of 81 pence per Thalassa Share on 22 March 2019, and
assuming full acceptance of the Offer, the aggregate value of
Thalassa Consideration Shares that may be issued pursuant to the
Offer is approximately GBP12.9 million. Pursuant to the buy-back
authority in place at the date of this Announcement, approximately
GBP5.8 million of the buy-back authority described above remains
available to be deployed.
LSR Shareholder voting in respect of the proposed Members
Voluntary Liquidation
The Thalassa Board notes LSR's selective commentary regarding
voting at LSR's general meeting in December 2018. Thalassa observes
that the number of LSR Shares that voted in favour of the relevant
resolution was only 34,127,797, or approximately 41.45% of LSR's
issued share capital.
58.6% OF LSR SHAREHOLDERS EITHER DID NOT VOTE OR VOTED AGAINST
THE LSR RESOLUTION TO LIQUIDATE THE COMPANY.
Thalassa questions why the LSR Board will not respect the wishes
of the majority of LSR Shareholders and continues to pursue what,
in the Thalassa Board's opinion, is a costly and forlorn strategy
which shareholders have already turned down.
The Thalassa Board urges LSR Shareholders to ignore what it
feels can only be described as desperate and self-serving
statements of the LSR Board and to instead accept Thalassa's Offer.
The First Closing Date of the Offer is 1:00pm on 27 March 2019.
Duncan Soukup, Executive Chairman of Thalassa, said:
"The Thalassa Board would like to emphasise that the Offer is a
bona fide offer which the LSR Board continues to reject for reasons
which, in my opinion, appear more personal than logical. Thalassa
is able to offer an exit to LSR Shareholders at a premium to the
current price of an LSR Share and also at a premium to the last
published figure that the LSR Board has disclosed might be
delivered under a liquidation of the Company.
"I note the following:
- the LSR Board has failed to return any material value to LSR Shareholders since IPO;
- the LSR Board has presided over aggregate losses after tax
amounting to almost GBP100 million since IPO;
- I have no faith in the LSR Board's suggested net asset or net
realisable values in light of ongoing asset writedowns,
transactions costs and the absence of any quantification of
potential returns were the LSR Board's proposals to be followed;
and
- any suggestion that a Premium Listing's corporate governance
requirements have protected LSR Shareholders is, in my view,
laughable given the losses incurred by LSR."
"The Thalassa Board is committed to continuing the current
buy-back Programme and undertakes to give ALL Thalassa Shareholders
the same commitment it has given since inception, which is to
manage our shareholders' money with the same care and attention as
we manage our own money."
"As I have stated in the past, our Offer provides LSR
Shareholders with an attractive premium to both the prevailing LSR
share price as well as the company's most recent (but now dated)
indication of a realisable NAV per LSR Share."
"Thalassa totally rejects the irrelevant assertions by the LSR
Board with regard to the issue of preference shares; a criticism
that is ironic insofar that it comes from a board which has, in my
opinion, itself presided over such spectacular value destruction.
It is disappointing to note that it would appear that a key part of
the LSR Board's strategy (at great cost to LSR Shareholders) is to
attempt to discredit the Thalassa Board's performance, integrity
and governance in order, in my opinion, to deflect attention away
from its own failings. I can see no good reason why the LSR Board
continues to expend a considerable amount of LSR Shareholders' cash
in preventing those same shareholders from accepting the Offer.
"Finally, it is important for long-suffering individual LSR
Shareholders to understand that they may need themselves to contact
the nominees, fund managers, and personal advisers who represent
them to make it clear that it is their wish to accept the Offer.
These intermediaries may be reluctant, as the LSR Board has been,
to accept the reality that its investment decisions on your behalf
have failed. Explain to them that the Offer makes sense. In the
absence of direct instructions, there can be no certainty that
these intermediaries will make an informed decision on your
behalf.
"Whether you wish to stay invested in Thalassa or not, the Offer
is the only credible, attractive and certain exit available for LSR
Shareholders. I urge you to make sure that you, and your advisers,
accept it."
The Offer Document
The Offer Document containing the full terms and conditions and
procedures for acceptance of the Offer and the related Form of
Acceptance (where applicable) was posted to LSR Shareholders on 6
March 2019.
Capitalised terms in this announcement (the "Announcement"),
unless otherwise defined, have the same meanings as set out in the
Offer Document. Copies of this Announcement, the Offer Document and
the Prospectus will be available free of charge (subject to certain
restrictions relating to persons in Restricted Jurisdictions) on
Thalassa's website at https://thalassaholdingsltd.com/offer.htm up
to and including the Effective Date. The contents of these websites
are not incorporated into, and do not form part of, this
Announcement.
Enquiries:
Thalassa Holdings Ltd
---------------------
+33 (0) 6 78 63 26
Duncan Soukup (Executive Chairman) 89
---------------------
finnCap (Financial Adviser to Thalassa) +44 (0) 207 220 0500
---------------------
Henrik Persson
Marc Milmo
Max Bullen-Smith
---------------------
Sources and assumptions
The relevant sources of information and bases of calculations
are provided in the order in which such information appears in this
Announcement. Where any such information is repeated above, the
underlying sources and bases are not repeated.
The references to Thalassa's current Offer value of 35.7 pence
per Offer Share are based on a Closing Price of 81 pence per
Thalassa Ordinary Share on 22 March 2019.
The references to a potential return net realisable value under
the MVL and having been undermined by LSR's own statements that
assets have continued to be sold at a loss are based on
announcements made by LSR since 11 October 2018 providing updates
on their property disposals.
The references to the aggregate asset write down of GBP103.2
million are calculated as the aggregate value of fair value
adjustments in LSR's assets as reported in LSR's annual report and
accounts from 30 September 2007 to 30 September 2018.
The references to LSR's Gross Rental Income of GBP145.1million
and Net After Tax loss of GBP99.8 million are calculated from an
aggregation of such figures published in LSR's annual report and
accounts from 30 September 2007 to 30 September 2018
Disclosure requirements of the City Code
Under Rule 8.3(a) of the City Code, any person who is interested
in 1% or more of any class of relevant securities of an offeree
company or of any securities exchange offeror (being any offeror
other than an offeror in respect of which it has been announced
that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer
period and, if later, following the announcement in which any
securities exchange offeror is first identified. An Opening
Position Disclosure must contain details of the person's interests
and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) applies must be made by no later than
3.30 p.m. on the 10(th) Business Day following the commencement of
the offer period and, if appropriate, by no later than 3.30 p.m. on
the 10(th) Business Day following the announcement in which any
securities exchange offeror is first identified. Relevant persons
who deal in the relevant securities of the offeree company or of a
securities exchange offeror prior to the deadline for making an
Opening Position Disclosure must instead make a Dealing
Disclosure.
Under Rule 8.3(b) of the City Code, any person who is, or
becomes, interested in 1% or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange
offeror(s), save to the extent that these details have previously
been disclosed under Rule 8. A Dealing Disclosure by a person to
whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. on
the Business Day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of
the City Code).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Panel's website at www.thetakeoverpanel.org.uk, including
details of the number of relevant securities in issue, when the
offer period commenced and when any offeror was first identified.
You should contact the Panel's Market Surveillance Unit on +44
(0)20 7638 0129 if you are in any doubt as to whether you are
required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on website
Pursuant to rule 26 of the Code, a copy of this announcement
will be available, subject to certain restrictions relating to
persons resident in, or subject to the laws and/or regulations, of
Restricted Jurisdictions, for inspection on the Thalassa's website
at www.thalassaholdingsltd.com/offer promptly and in any event by
no later than 12 noon (London time) on the business day following
the date of this announcement. For the avoidance of doubt the
contents of those websites are not incorporated into, and do not
form part of, this announcement.
Rule 2.9 disclosure
In accordance with Rule 2.9 of the City Code on Takeovers and
Mergers, the Company now has in issue 17,565,275 ordinary shares
carrying one vote each (excluding the 8,002,247 ordinary shares
held in Treasury) and admitted to the standard listing segment of
the Official List of the UK Listing Authority (the "Official List")
and to trading on London Stock Exchange plc's main market ("Main
Market") for listed securities. Furthermore, Thalassa has in issue
17,177,547 preference shares (each carrying 10 votes), and are not
admitted to trading on any exchange. The ISIN for the Thalassa
ordinary shares is VGG878801031.
Rule 27.2
For the purposes of Rule 27.2 of the Code:
(i) save as for Thalassa's views on the past performance and
conduct of Thalassa and LSR, sourced from publicly available
information (to which the sources and bases of information are set
out in Thalassa's announcement of 19 March 2019), there have been
no changes in information disclosed in the Offer Document published
by Thalassa in connection with the Offer which are material in the
context of that document; and
(ii) save as for certain further dealings in relevant securities
(being principally certain further buybacks of Thalassa Shares by
Thalassa), there have been no material changes to matters listed in
Rule 27.2(b) of the Code which have occurred since the publication
of the Offer Document.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
RSPFMGZFGKDGLZM
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March 25, 2019 06:45 ET (10:45 GMT)
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