TIDMBWN
RNS Number : 7584X
Bowen Fintech PLC
22 December 2023
The information contained within this announcement is deemed to
constitute inside information as stipulated under Article 7 of EU
Regulation 596/2014 (which forms part of domestic UK law pursuant
to the European Union (Withdrawal) Act 2018). Upon the publication
of this announcement, this inside information is now considered to
be in the public domain.
22 December 2023
Bowen Fintech plc
("Bowen" or the "Company")
Proposed Acquisition and Temporary Suspension of Trading in the
Company's Ordinary Shares
Bowen (LSE: BWN), a special purpose acquisition company formed
to acquire businesses in the technology innovations sector with a
focus on the financial services industry, is pleased to announce
that it has signed conditional, non-legally binding heads of terms
to acquire 93.49 per cent of the issued share capital of
MINNADEOOYASAN-HANBAI Co., Ltd ("MOH") ("Acquisition").
About MOH
MOH is a leading crowdfunding services platform in Japan and
solution provider for investors seeking returns from investment
into real estate. MOH was incorporated in 1998 with its head office
in Tokyo, and is regulated under the Real Estate Specified Joint
Venture Act. It commenced crowdfunding services in 2007.
In the last 16 years, MOH has arranged over JPY 217 billion (c.
GBP1.3 billion) in capital raising from the Japanese market, with
approximately JPY 62 billion (c. GBP378 million) raised in its
financial year ending 31 March 2023.
MOH is majority owned by Kyosei Bank Co., Ltd ("KBC"), a
privately owned company in Japan, and provides crowdfunding
services to a property holding and management company within the
same corporate group as KBC. This provides MOH with a proprietary
pipeline of projects to facilitate funds for, and (where it has the
resources to do so) occasionally MOH itself may participate in, the
acquisition of land for development.
In addition to traditional real estate asset classes such as
residential and commercial, MOH is seeking to facilitate funding
for technology-driven commercial projects, such as cold-chain
logistics facilities, state-of-the-art medical facilities and the
revival of traditional cultural parks. MOH intends to participate
in building cutting-edge cold-chain logistics infrastructure in
Japan and expects to replicate this model in ASEAN countries and
beyond in the future as part of its growth strategy.
MOH is profitable, reporting EBITDA of JPY 519 million (c.
GBP3.2 million) on revenues of JPY 5.6 billion (c. GBP34.3 million)
in the year to 31 March 2023. In the six-month period to 30
September 2023, MOH management accounts reported (unaudited) EBITDA
of JPY 2.1 billion (c. GBP11.6 million) on revenues of JPY 4.9
billion (c. GBP27.8 million). Unaudited net assets as at 30
September 2023 were JPY 4.8 billion (c. GBP26.4 million).
The directors of MOH are of the opinion that a listing by way of
a reverse takeover of Bowen by MOH (the "Enlarged Group") will
enhance its brand and profile in Japan and internationally, enable
access to additional real estate portfolios internationally, thus
diversifying risk, and access to fresh equity capital in the future
to accelerate its growth strategy, particularly in the area of
technology-related real estate.
The listing will also support MOH in attracting and retaining
senior professionals both locally in Japan and internationally.
Following the Acquisition, it is the intention of the Enlarged
Group to grow its presence in the UK.
The Acquisition
The Company has entered into conditional, non-legally binding
heads of terms with MOH and KBC to acquire 93.49 per cent of the
issued share capital of MOH from KBC for a consideration of
approximately GBP34.47 million to be satisfied through the issue of
new ordinary shares of 1p each in the Company ("Ordinary Shares"),
at a price of 15p per new Ordinary Share (the "Offer Price"). The
Offer Price represents a premium of 25 per cent to the closing
middle market price of 12 p per Ordinary Share on 21 December 2023,
being the closing middle market price the day prior to the release
of this announcement.
The Acquisition is conditional upon, among other things:
-- the completion of satisfactory due diligence by both parties;
-- the negotiation and the entry into legally binding documentation;
-- any requisite third party consents being obtained;
-- the re-admission of the Company's enlarged share capital to
the Official List of the Financial Conduct Authority ("FCA") (by
way of a Standard Listing under Chapter 14 of the Listing Rules)
and to trading on London Stock Exchange Group Plc's (the "LSE")
Main Market for listed securities ; and
-- a waiver being granted by the Panel on Takeovers and Mergers
of any requirement under Rule 9 of the Takeover Code that would
otherwise arise on KBC to make a general offer to the Company's
shareholders as a result of the issue of the new Ordinary Shares at
the Offer Price to it on completion.
It is currently anticipated by the directors of Bowen that on
re-admission the market capitalisation of the Enlarged Group would
be approximately GBP42.72 million, based on the Offer Price, with
KBC holding approximately 80.7 per cent of the issued share capital
of the Enlarged Group and existing Bowen shareholders holding
approximately 19.3 per cent of the issued share capital of the
Enlarged Group.
Subject to review of the Enlarged Group's working capital, it is
not intended that new capital will be raised as part of the
Acquisition and re-admission.
Suspension of Ordinary Shares
The Acquisition will on completion constitute a reverse takeover
under Chapter 5.6 of the FCA's Listing Rules since, inter alia, in
substance it would result in a fundamental change in the ownership
and business of the Company. The Company has therefore applied for
and has been granted a temporary suspension of the listing on the
Official List of the FCA of its Ordinary Shares and its trading on
the Main Market for listed securities with effect from 7.30 am this
morning until such time as it publishes a prospectus in relation to
the Acquisition or it being announced that the Acquisition will not
proceed.
As the Acquisition would constitute a reverse takeover under the
Listing Rules, on completion of the Acquisition, application would
need to be made to the FCA and the LSE for the immediate
re-admission of the issued and to be issued share capital of the
Enlarged Group to the Official List (by way of a Standard Listing
under Chapter 14 of the Listing Rules) and to trading on the LSE's
Main Market for listed securities.
Further announcements will be made, as appropriate, in due
course.
Enquiries
Bowen Fintech plc c/o +44 (0)204 582
3500
Aamir Quraishi, Chairman
--------------------
Cairn Financial Advisers LLP +44 (0)207 213 0880
--------------------
Emily Staples, Jo Turner
--------------------
Gracechurch Group +44 (0)204 582 3500
--------------------
Harry Chathli, Claire Norbury
--------------------
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identified by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "expect", "will" or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward-looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements reflect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors.
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END
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December 22, 2023 02:41 ET (07:41 GMT)
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