TIDMDEC
RNS Number : 3487Z
Diversified Energy Company PLC
20 May 2021
THIS ANNOUNCEMENT (INCLUDING APPIX 1) AND THE INFORMATION
CONTAINED HEREIN ARE RESTRICTED, FOR INFORMATION PURPOSES ONLY AND
ARE NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, AND DO NOT CONSTITUTE AN OFFER OF
SECURITIES FOR SALE IN OR INTO THE UNITED STATES, AUSTRALIA,
CANADA, SOUTH AFRICA, JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH
PUBLICATION, RELEASE, DISTRIBUTION, OFFER OR SALE WOULD BE
UNLAWFUL. PLEASE SEE THE IMPORTANT NOTICES AT THE OF THIS
ANNOUNCEMENT.
FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND
IS NOT AN OFFER OF SECURITIES IN ANY JURISDICTION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE UK VERSION OF REGULATION (EU) NO. 596/2014 ON
MARKET ABUSE ("UK MAR"), AS IT FORMS PART OF UK DOMESTIC LAW BY
VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AND REGULATION
(EU) NO. 596/2014 ON MARKET ABUSE ("EU MAR").
20 May 2021
DIVERSIFIED ENERGY COMPANY PLC
("Diversified" or the "Company")
Conditional Acquisition and
Proposed Placing and Retail Offer
DIVERSIFIED ENERGY COMPANY PLC (LSE: DEC ), announces that it
has entered into a conditional agreement to acquire certain
upstream assets and related infrastructure in its newly identified
Central Regional Focus Area ("Central RFA") from Blackbeard
Operating, LLC ("Blackbeard" and such acquisition, the "Blackbeard
Acquisition"). This announcement follows the announcement on 30
April 2021 in relation to the conditional acquisition of certain
Cotton Valley upstream assets and related facilities also located
in the Central RFA from Indigo Minerals LLC ("Indigo"), which was
subsequently announced as completed on 19 May 2021 (the "Indigo
Acquisition" and, together with the Blackbeard Acquisition, the
"Acquisitions").
The Company further announces its intention to carry out a
fundraise (the "Proposed Fundraising"), comprising a
non-pre-emptive placing of new ordinary shares of GBP0.01 each in
the Company (the "Placing Shares") at the Placing Price (as defined
below) (the "Placing") and an offer made by the Company on the
PrimaryBid Platform of new ordinary shares of GBP0.01 each in the
Company (the "Retail Offer Shares") at the Placing Price (the
"Retail Offer") to provide retail investors with an opportunity to
participate. A separate announcement will be made shortly regarding
the Retail Offer and its terms. Together, the total number of
Placing Shares and Retail Offer Shares (together, the "Fundraising
Shares") will not exceed 19.99 per cent. of the Company's existing
ordinary share capital. The number of Placing Shares and Retail
Offer Shares, and the price at which the Fundraising Shares are to
be issued will be announced by the Company at the close of the
bookbuilding process.
Subject to closing of the Blackbeard Acquisition, the Company
will use the net proceeds from the Proposed Fundraising to (i) part
fund the Acquisitions; and (ii) to part repay amounts drawn down on
its Revolving Credit Facility (" RCF ") in connection with the
Indigo Acquisition in order to provide financing capacity for
additional potential acquisition opportunities. The Proposed
Fundraising is not conditional on the completion of the Blackbeard
Acquisition. Should Diversified not complete the Blackbeard
Acquisition, the Company will determine the most appropriate use of
the net proceeds, including potentially paying down further amounts
drawn on its RCF and/or investing in other acquisition
opportunities aligned with its stated strategy.
Blackbeard Acquisition Highlights
-- Initial gross aggregate consideration of US$180 million ($166
million estimated net consideration after customary purchase price
adjustments), with effective date of 1 April 2021;
o Net consideration represents a 3.5x multiple on US$48 million
of estimated NTM Adjusted EBITDA (unhedged) before potential
synergies
-- Current net production of approximately 16 Mboepd (82%
natural gas), representing approximately 16% of Q1 2021 net
production;
-- Estimated PDP Reserves of approximately 79 MMboe valued at an
estimated pre-tax PV10 of approximately US$238 million, with the
estimated net consideration reflecting an approximate 30% discount
to PDP PV10;
-- Represents an attractive entry point into the Barnett Shale,
one of the more mature natural gas shale plays in the United
States, and enlarges the Company's presence in the Central RFA,
following the acquisition of Cotton Valley Assets from Indigo;
and
-- The Blackbeard Acquisition is conditional and remains subject
to, among other things, further diligence and there can be no
certainty that the Blackbeard Acquisition will complete.
Central Regional Focus Area Highlights
-- The Acquisitions provide a strategic entry into the prolific,
gas-producing Cotton Valley / Haynesville area and the mature
gas-producing Barnett Shale, located within the Central RFA;
-- The Central RFA has significant similarities with the
Appalachian Basin, with mature operating regions of significant gas
production, developed infrastructure and a fragmented operator
landscape suited for consolidation. The addition of this new
operating region provides a significant growth opportunity for
Diversified to replicate its business model in the Central RFA;
-- The Acquisitions in the Central RFA provide a solid platform
for further acquisitions in the region, that complement
Diversified's continuing growth potential in its Appalachian
operations;
-- The Acquisitions fit the Company's strategy, with long-life,
low-decline, low-cost producing assets supporting the Company's
cash-flow profile and margins, and are expected to be immediately
accretive to EBITDA per share based on the Company's 2020 reported
results, management's estimates for the assets and the Proposed
Fundraising; and
-- The Company expects assets within the Cotton Valley /
Haynesville and Barnett Shale to benefit from the Company's Smarter
Asset Management programme and to deliver operating efficiencies
that enhance shareholder value.
Proposed Fundraising Highlights
-- The Proposed Fundraising will consist of the Placing and
Retail Offer of up to a maximum of 19.99% of the Company's existing
issued share capital;
-- The Placing will be conducted through an accelerated
bookbuild process (the "Bookbuild"), which will launch immediately
following the release of this announcement. The Placing is subject
to the terms and conditions set out in Appendix 1 to this
announcement (which forms part of this Announcement (and together
with Appendix 1, the "Announcement");
-- Stifel Nicolaus Europe Limited, Tennyson Securities Limited
and Credit Suisse Securities (Europe) Limited (together, the "Joint
Global Coordinators") are acting as joint global coordinators and
bookrunners in connection with the Placing;
-- T he number of Fundraising Shares and the price at which the
Placing Shares are to be placed (the "Placing Price") will be
determined following completion of the Bookbuild by agreement
between the Company and the Joint Global Coordinators;
-- The Company expects to close the Bookbuild no later than 8.00
a.m. on 21 May 2021, but the Joint Global Coordinators and the
Company reserve the right to close the Bookbuild earlier or later,
without further notice. Further, pricing and allocations are at the
absolute discretion of the Joint Global Coordinators and the
Company. Details of the Placing Price and the number of Placing
Shares will be announced as soon as practicable after the close of
the Bookbuilding ;
-- Concurrently with the Placing, the Company intends to raise
up to EUR8.0 million (GBP6.9 million) in the Retail Offer, to
provide retail investors with an opportunity to participate in the
Proposed Fundraising. The Retail Offer is not made subject to the
terms and conditions set out in Appendix 1 to this Announcement and
instead will be made on the terms outlined in the separate
announcement to be made shortly regarding the Retail Offer and its
terms ;
-- The Acquisitions and Proposed Fundraising are expected to
leave the Company with an estimated Net Debt to 2020 Adjusted
EBITDA multiple of 1.8x. Illustratively, based on these metrics,
the Company could potentially assume a further $335 million in
potential debt capacity whilst remaining at or below a Net Debt to
Adjusted EBITDA of 2.3x, on the basis the $335 million was used to
acquire assets at n purchase price multiple of 3.5x. The ability to
support additional non-equity financing allows the Company to
pursue additional acquisition opportunities and deliver further
value for investors;
-- A Director of the Company has indicated his intention to
acquire shares as part of, or shortly after, the Proposed
Fundraising and appropriate disclosure will be made in relation to
this purchase in due course;
-- Shares issued pursuant to the Proposed Fundraising will be
eligible for the Q4 2020 dividend of 4.0 cents per share, as well
as all future dividends. The ex-dividend date of the Q4 2020
dividend is 27 May 2021 and the Q4 Dividend is expected to be paid
on 24 June 2021.
Recognizing the significance of the Proposed Fundraising aimed
at advancing Diversified's consistent and well-articulated
strategy, the Company consulted with and received strong support
from many of its largest shareholders prior to the Proposed
Fundraising. Consistent with each of its prior placings, the
Company will respect the principles of pre-emption, so far as is
possible, through the allocation process, both in the Placing and
Retail Offer. Given the expected share-level earnings and cash-flow
accretion of the Acquisitions funded with proceeds from the
Placing, and given the importance of leveraging a key competitive
advantage over other potential buyers of the target assets by being
able to raise capital quickly in the London market, the Company
believes the structure of the Proposed Fundraising, including its
use of the cash box structure, is very much aligned with
shareholder and other stakeholder interests. The Placing structure
has allowed Diversified to move quickly to secure the Blackbeard
Acquisition, reducing both the complexity and time required to
raise the capital necessary to acquire long-life, low-decline and
highly cash generative assets.
Commenting on the Acquisitions and Proposed Fundraising, CEO
Rusty Hutson said:
"Today's announcement of our second acquisition in the newly
defined Central Regional Focus Area evidences the strong momentum
we have quickly built in an area poised for consolidation quite
similarly to our experience in Appalachia, where we emerged as a
highly capable buyer and operator of assets. With just two
transactions, the Central RFA adds nearly a third to our daily
production, and will benefit both from our Smarter Asset Management
programmes and from the additional scale that future infill
acquisitions will afford us to reduce costs and further improve
already strong margins. By largely funding these two initial
acquisitions with equity and reducing our leverage to just 1.8
times Net Debt-to-Adjusted EBITDA, we have positioned ourselves
with an even stronger balance sheet, in an acquisition-rich
environment, with the ability to move quickly to build additional
scale in a highly-accretive way for shareholders using our access
to low-cost financing. We now turn our attention to the systematic
integration of the Indigo assets on which we closed earlier this
week and to completing our diligence on the Blackbeard assets that
we expect to close next month."
Diversified Energy Company PLC
Teresa Odom, Vice President, Investor Relations
https://www.div.energy/ + 1 (205) 408 0909
Stifel Nicolaus Europe Limited
(Joint Global Coordinator, Joint Broker)
Callum Stewart
Jason Grossman
Simon Mensley
Ashton Clanfield +44 (0)20 7710 7600
Tennyson Securities Limited
(Joint Global Coordinator, Joint Broker)
Peter Krens
Edward Haig-Thomas +44 (0)20 7186 9033
Credit Suisse Securities (Europe) Limited
(Joint Global Coordinator)
Ryan Pickard
James Peterkin
Ben Lawrence
Omri Lumbroso +44 (0)20 7888 8888
Buchanan
(Financial Public Relations)
Ben Romney
Chris Judd
Kelsey Traynor
James Husband
dec@buchanan.uk.com +44 (0)20 7466 5000
Evercore is acting as US Financial Advisor to the Company in
connection with the Blackbeard Acquisition. DNB Bank ASA and DNB
Markets, Inc. a subsidiary of DNB Bank ASA, Keybanc Capital
Markets, a trading name of Keybanc Capital Markets Inc., Mizuho
International plc, Canadian Imperial Bank of Commerce, a bank
chartered under the Bank Act (Canada), acting through its
registered branch in the United Kingdom and RBC Europe Limited are
acting as co-lead managers.
Background to, and reasons for, the Acquisitions and the
Proposed Fundraising
Diversified Energy is an established, independent owner and
operator of producing natural gas and oil wells, with operations to
date concentrated in the Appalachian Basin in the United States
throughout the neighbouring states of Tennessee, Kentucky,
Virginia, West Virginia, Ohio, and Pennsylvania, where it is the
largest independent conventional producer. The Company has grown
rapidly over the last few years, capitalising on opportunities to
acquire and enhance producing assets in its region of focus, and
leveraging the operating efficiencies that come with economies of
scale.
The Company has a proven track-record of capitalising on
opportunities to acquire complementary producing conventional and
non-conventional gas and oil assets in the Appalachian Basin from
industry players who are seeking to re-focus resources, with target
assets characterised by predictable production rates, long lives,
and low decline rates. The Company maximises and extends production
through the deployment of rigorous field management, deploying new
extraction technology, and/or refreshing decayed infrastructure on
poorly maintained wells. Through operational efficiencies,
including utilising the Company's growing midstream infrastructure,
the Company maximises value by enhancing production, targeting
premium pricing points, and streamlining costs.
Whilst the Company expects the Appalachian Basin will continue
to provide a strong opportunity set for future acquisitions and
growth, it believes that geographically diversifying into other
attractive basins provides a significant opportunity for the
business. The Indigo and Blackbeard Acquisitions are the first
acquisitions outside of the Appalachian Basin, with operations
focussed in Louisiana and Texas in an area the Company defined as
its Central Regional Focus Area. The Company believes that the
Central Regional Focus Area provides many of the same opportunities
afforded by the Appalachian Basin, with the Acquisitions providing
low-cost, long-life, low decline gas-weighted production assets and
creating significant potential for synergies with regional
scale.
The Company believes that it is well positioned with pre-tax
PV10 of its PDP assets of US$1.9 billion, including PDP Reserves of
607 MMBoe prior to the Acquisitions for the fiscal year ended 31
December 2020, reflecting a largely predictable, long life, low
decline asset base. The Company has a demonstrated record of
sustaining well production and driving cost efficiencies into its
assets through its Smarter Asset Management programme.
The Company has a proactive approach to hedging, using a
combination of structures to provide cost efficient downside
protection whilst maintaining an element of upside potential. At
present, the Company has outstanding hedges for approximately 90%
of its existing and remaining 2021 estimated natural gas
production, at average prices of US $ 2.65 / MMBtu as well as
approximately half of its natural gas production between 2022 and
2024 at US$2.46/MMBtu or above .
Given the strength of the Company's asset base and hedge
portfolio, it is well positioned to take advantage of the
opportunity it sees in the sector. With a number of industry
participants refocusing capital away from what they consider to be
non-core assets, Diversified continues to find opportunities to
acquire assets at an attractive valuation, remove cost, and drive
operational efficiencies into its asset base, ultimately supporting
the Company's long term cash flow generation, dividend, and the
return for its shareholders.
The Blackbeard Acquisition
The Company has executed a conditional agreement with Blackbeard
to acquire certain gas and oil wells as well as related midstream
infrastructure. The initial consideration, should the acquisition
proceed, is expected to be US$180 million with estimated net
consideration of $166 million, based on customary purchase price
adjustments. The transaction is subject to ongoing due diligence,
which the Company will complete to its satisfaction prior to
confirming the final terms (including purchase price), and there
can be no certainty that the Blackbeard Acquisition will proceed.
The transaction is expected to close in late June 2021. Should the
Blackbeard Acquisition proceed, it is expected to have a deemed
effective date of 1 April 2021 and the final consideration payable
by the Company would, therefore, be reduced by the value of any
interim cash flows from the effective date to the closing date.
The Blackbeard Acquisition includes approximately 820 net
operated wells over some 123,000 acres in the Barnett Shale region
of Texas, approximately 120 km away from the Central RFA assets
acquired in the Indigo Acquisition, demonstrating the Company's
ability to create scale in the focus area rapidly. The average
working and net revenue interests of the wells included within the
transaction is 65% and 53% respectively.
The assets have current adjusted net production of approximately
16 MBoepd, of which 82% is natural gas, and estimated PDP Reserves
of approximately 79 MMBoe. Based on the Company's preliminary
assessment, the assets have a PDP pre-tax PV10 of US$238 million
based on NYMEX strip as of 7 May 2021.
On average, the assets included within the Blackbeard
Acquisition are estimated to have a year-one production decline
rate of approximately 8%. These assets offer the same long-life,
gas-weighted production potential and low terminal decline as the
Company's broader portfolio.
Key operating metrics for the assets (excluding synergies)
include a US$0.25 -$0.35/MMBtu net gas differential discount
(inclusive of index differentials and marketing deducts), an
estimated cash operating cost of $1.57/Mcfe and an estimated Hedged
Adjusted EBITDA Margin of approximately 50%. Based on forecast
production and current pricing, Adjusted EBITDA attributable to the
acquired assets for the next twelve months from 1 July 2021 will be
approximate US$48 million, excluding longer-term synergies that the
Company expects to be able to realise.
With decades of productive capacity remaining in the acquired
wells, the Company does not expect any significant near-term cash
requirements in relation to plugging and abandonment ("P&A")
activities. The Company estimates costs for P&A activities to
be in the range of $50,000 - $60,000 per well, with pricing
favourable compared to existing operations given the nature and
depth of the wells. The Company is not required at this time to
enter into any state level P&A agreements.
Through the combination of the Blackbeard and Indigo
acquisitions, Diversified has established a meaningful footprint in
its Central Regional Focus Area, with a leasehold position now
covering over 300,000 net acres generating approximately 32 MBoepd
of production and $413 million of PDP PV10 Reserve value in
aggregate.
The Central RFA has significant similarities with the
Appalachian Basin, with mature operating regions and significant
gas production from low-cost, low-decline well stock and an
extremely fragmented operator landscape. The addition of this new
operating basin provides a significant growth opportunity for
Diversified to repeat its business model in the Central RFA,
alongside further growth potential in the Company's Appalachian
operations.
Subject to closing of the Blackbeard Acquisition, the Company
will use the net proceeds from the Proposed Fundraising to (i) part
fund the Acquisitions; and (ii) part repay amounts drawn down on
its RCF in connection with the Indigo Acquisition in order to
provide financing capacity for additional potential acquisition
opportunities.. Under the existing borrowing base, ahead of any
potentially positive redeterminations given the stronger
macro-environment and before incorporating the Acquisitions, the
Company would have available liquidity of $159 million. The Company
estimate that following the Acquisitions and the Proposed
Fundraising, it would have a Net Debt / 2020 Pro Forma Adjusted
EBITDA ratio (assuming a full year contribution from EQT, Carbon
and Utica Shale acquisitions in 2020) of 1.8x, significantly below
the Company's internal leverage thresholds of 2.5x. This reduction
in leverage provides significant financing capacity should the
Company successful identify and secure further acquisitions in the
Central RFA or Appalachian Basin.
Details of the Placing
The Placing Price will be announced on closing of the Proposed
Fundraising.
The Placing is being conducted through an accelerated bookbuild
process to eligible institutional investors outside the United
States in "offshore transactions" as defined in the US Securities
Act of 1933, as amended (the "Securities Act"), and in the United
States, save with the Company's agreement, only to persons
reasonably believed to be "qualified institutional buyers" in
transactions not involving a "public offering" within the meaning
of section 4(a)(2) of the Securities Act pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act. The Placing is not conditional
on completion of the Acquisitions.
The Placing will launch immediately following the release of
this Announcement. The Company expects to close the Bookbuild no
later than 8.00 a.m. on 21 May 2021, but the Joint Global
Coordinators and the Company reserve the right to close the
Bookbuild earlier or later, without further notice.
The Placing Shares, when issued, will be fully paid and will
rank pari passu in all respects with each other and with the
existing ordinary shares of GBP0.01 in the capital of the Company,
including the right to receive all dividends and other
distributions declared, made or paid after the date of issue.
Applications will be made to (i) the Financial Conduct Authority
(the "FCA") for admission of the Placing Shares and the Retail
Offer Shares to listing on the premium listing segment of the
Official List; and (ii) London Stock Exchange plc for admission of
the Placing Shares and the Retail Offer Shares to trading on its
main market for listed securities (together, "Admission").
Settlement for, and Admission of, the Placing Shares and the Retail
Offer Shares is expected to take place on or before 8.00 a.m. on 25
May 2021. The Placing is conditional upon, among other things,
Admission becoming effective. The Placing is also conditional upon
the placing agreement between the Company, the Co-Lead Managers and
the Joint Global Coordinators (the "Placing Agreement") becoming
unconditional and not being terminated in accordance with its
terms. Appendix 1 to this Announcement sets out further information
relating to the terms and conditions of the Placing.
Shares issued pursuant to the Proposed Fundraising will be
eligible for the Q4 2020 dividend of 4.0 cents per share, as well
as all future dividends. The ex-dividend date of the Q4 2020
dividend is 27 May 2021 and it is expected to be paid on 24 June
2021.
Stifel Nicolaus Europe Limited, Tennyson Securities and Credit
Suisse Securities (Europe) Limited are acting as joint global
coordinators and bookrunners in connection with the Placing. An
affiliate of Credit Suisse Securities (Europe) Limited is a party
to a credit facility of the Company and, in the event that the
Company determines to use the net proceeds of the Proposed
Fundraising to pay down its debt, it may receive a portion of net
proceeds in connection with such pay down.
This Announcement should be read in its entirety. Investors'
attention is drawn to the detailed terms and conditions of the
Placing described in Appendix 1 (which forms part of this
Announcement).
By participating in the Placing, investors will be deemed to
have read and understood this Announcement (including Appendix 1)
in its entirety, to be participating in the Placing and making an
offer to acquire, and acquiring, ordinary shares of the Company
under the Placing on the terms and subject to the conditions of the
Placing set out in Appendix 1 to this Announcement, and to be
providing the representations, warranties, undertakings and
acknowledgements contained in Appendix 1 to this Announcement.
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. 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.
IMPORTANT NOTICES
THIS ANNOUNCEMENT (INCLUDING APPIX 1) AND THE TERMS AND
CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") IS NOT
FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO
THE UNITED STATES OF AMERICA. THIS ANNOUNCEMENT IS NOT AN OFFER OF
SECURITIES FOR SALE INTO THE UNITED STATES (INCLUDING ITS
TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE
DISTRICT OF COLUMBIA (COLLECTIVELY, THE "UNITED STATES")). THE
SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMED, OR UNDER
THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE
UNITED STATES AND MAY NOT BE OFFERED OR SOLD OR TRANSFERRED,
DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, EXCEPT
PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION AND IN
COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION OF THE UNITED STATES. NO PUBLIC OFFERING OF
SECURITIES IS BEING MADE IN THE UNITED STATES.
THIS ANNOUNCEMENT IS NOT FOR PUBLIC RELEASE, PUBLICATION OR
DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
INTO AUSTRALIA, CANADA, SOUTH AFRICA, JAPAN OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES
ONLY AND DOES NOT CONSTITUTE OR FORM ANY PART OF AN OFFER TO SELL
OR ISSUE, OR A SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE FOR OR
OTHERWISE ACQUIRE ANY SECURITIES IN AUSTRALIA, CANADA, SOUTH
AFRICA, JAPAN OR ANY JURISDICTION IN WHICH OR TO ANY OTHER PERSON
TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. ANY
FAILURE TO COMPLY WITH THESE RESTRICTIONS MAY CONSTITUTE A
VIOLATION OF THE SECURITIES LAWS OF SUCH JURISDICTIONS.
NO PUBLIC OFFERING OF THE SECURITIES REFERRED TO HEREIN IS BEING
MADE IN ANY SUCH JURISDICTION OR ELSEWHERE.
No action has been taken by the Company, Credit Suisse
Securities (Europe) Limited ("Credit Suisse"), Tennyson Securities,
a trading name of Shard Capital Partners LLP ("Tennyson
Securities") or Stifel Nicolaus Europe Limited ("Stifel" and,
together with Credit Suisse and Tennyson Securities, the "Joint
Global Coordinators ") DNB Bank ASA and DNB Markets, Inc. a
subsidiary of DNB Bank ASA ("DNB Markets"), Keybanc Capital
Markets, a trade name for KeyBanc Capital Markets Inc. ("Keybanc"),
Mizuho International plc ("Mizuho"), Canadian Imperial Bank of
Commerce, a bank chartered under the Bank Act (Canada), acting
through its registered branch in the United Kingdom ("CIBC, London
Branch"), RBC Europe Limited ("RBC"), each acting as co-lead
managers any of (DNB Markets, Keybanc, Mizuho, CIBC, London Branch
and RBC together, the "Co-Lead Managers") (the Co-Lead Managers
together with the Joint Global Coordinators , the "Banks") or any
of their respective affiliates, or any of their respective
directors, officers , partners, employees , advisers or agents or,
in the case of the Joint Global Coordinators and Co-Lead Managers,
persons connected with them as defined in FSMA (collectively,
"Representatives") that would permit an offer of the new ordinary
shares of the Company to be issued pursuant to the Placing (the "
Placing Shares ") in any jurisdiction where action for that purpose
is required. Persons receiving this Announcement are required to
inform themselves about and to observe any restrictions contained
in this Announcement. The distribution of this
Announcement and the Placing and/or the offer or sale of the
Placing Shares in certain jurisdictions may be restricted by law.
Persons (including, without limitation, nominees and trustees) who
have a contractual or other legal obligation to forward a copy of
this Announcement should seek appropriate advice before taking any
action. Persons distributing any part of this Announcement must
satisfy themselves that it is lawful to do so.
This Announcement has not been approved by the Financial Conduct
Authority or the London Stock Exchange.
Members of the public are not eligible to take part in the
Placing. This Announcement is directed at and is only being
distributed to persons: (a) if in member states of the European
Economic Area, "qualified investors" within the meaning of Article
2(e) of Regulation (EU) 2017/1129 (the "Prospectus Regulation")
("Qualified Investors"); or (b) if in the United Kingdom, Qualified
Investors within the meaning of Article 2(e) of the UK Prospectus
Regulation who are (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
amended (the "Order"), or (ii) persons who fall within Article
49(2)(a) to (d) of the Order; or (c) persons to whom they may
otherwise lawfully be communicated (each such person above, a
"Relevant Person"). No other person should act or rely on this
Announcement and persons distributing this Announcement must
satisfy themselves that it is lawful to do so. By accepting the
terms of this Announcement, you represent and agree that you are a
Relevant Person, if in the United Kingdom, or a Qualified Investor,
if in a member state of the EEA. This Announcement must not be
acted on or relied on by persons who are not Relevant Persons, if
in the United Kingdom, or Qualified Investors, if in a member state
of the EEA. Any investment or investment activity to which this
Announcement or the Placing relates is available only to Relevant
Persons, if in the United Kingdom, and Qualified Investors, if in a
member state of the EEA, and will be engaged in only with Relevant
Persons, if in the United Kingdom, and Qualified Investors, if in a
member state of the EEA.
No offering document or prospectus will be available in any
jurisdiction in connection with the matters contained or referred
to in this Announcement and no such offering document or prospectus
is required (in accordance with the Prospectus Regulation or UK
Prospectus Regulation ) to be published.
This Announcement does not constitute, or purport to include the
information required of, a disclosure document under Chapter 6D of
the Australian Corporations Act 2001 (Cth) ("Corporations Act") and
will not be lodged with the Australian Securities and Investments
Commission. No offer of Placing Shares is or will be made to
persons in Australia pursuant to this Announcement, except to a
person who is a "sophisticated investor" within the meaning of
section 708(8) of the Corporations Act or a "professional investor"
within the meaning of section 708(11) of the Corporations Act and a
wholesale client under section 761G(7) of the Corporations Act. If
any Placing Shares are issued, they may not be offered for sale (or
transferred, assigned or otherwise alienated) to investors in
Australia for at least 12 months after their issue, except in
circumstances where disclosure to investors is not required under
Part 6D.2 of the Corporations Act.
Certain statements this Announcement are forward-looking
statements with respect to the Company's expectations, intentions
and projections regarding its future performance, strategic
initiatives, anticipated events or trends and other matters that
are not historical facts and which are, by their nature, inherently
predictive, speculative and involve risks and uncertainty because
they relate to events and depend on circumstances that may or may
not occur in the future. All statements that address expectations
or projections about the future, including statements about
operating performance, strategic initiatives, objectives, market
position, industry trends, general economic conditions, expected
expenditures, expected cost savings and financial results, are
forward-looking statements. Any statements contained in this
Announcement that are not statements of historical fact are, or may
be deemed to be, forward-looking statements. These forward-looking
statements, which may use words such as "expects", "anticipates",
"plans", "intends", "projects", "indicates" ( or the negative
thereof ) and similar expressions , are not guarantees of future
performance and are subject to known and unknown risks and
uncertainties . There are a number of factors including, but not
limited to, commercial, operational, economic and financial
factors, that could cause actual results, financial condition,
performance or achievements to differ materially from those
expressed or implied by these forward-looking statements . Many of
these risks and uncertainties relate to factors that are beyond the
Company's ability to control or estimate precisely, such as changes
in taxation or fiscal policy, future market conditions, currency
fluctuations, price fluctuations in crude oil and natural gas,
drilling and production results, reserves estimates, environmental
and physical risks, the behaviour of other market participants, the
actions of governments or governmental regulators, or other risks
factors, such as changes in the political, social and regulatory
framework in which the Company operates or in economic or
technological trends or conditions, including inflation, recession
and consumer confidence, on a global, regional or national basis.
Given these risks and uncertainties , readers are cautioned not to
place undue reliance on forward-looking statements .
Forward-looking statements speak only as of the date of such
statements and, except as required by the FCA, the London Stock
Exchange or applicable law, the Company, the Joint Global
Coordinators , the Co-Lead Managers and their respective
Representatives undertake no obligation to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.
In particular, no statement in this Announcement is intended to
be a profit forecast or profit estimate and no statement of a
financial metric (including estimates of adjusted EBITDA, profit
before tax, free cash flow or net debt) should be interpreted to
mean that any financial metric for the current or future financial
years would necessarily match or exceed the historical published
position of the Company and its subsidiaries. Certain statements in
this Announcement may contain estimates. The estimates set out in
this Announcement have been prepared based on numerous assumptions
and forecasts, some of which are outside of the Company's influence
and/or control, and is therefore inherently uncertain and there can
be no guarantee or assurance that it will be correct. The estimates
have not been audited, reviewed, verified or subject to any
procedures by the Company's auditors. Undue reliance should not be
placed on them and there can be no guarantee or assurance that they
will be correct.
Credit Suisse is authorised by the Prudential Regulation
Authority (the "PRA") and regulated by the PRA and the Financial
Conduct Authority (the "FCA") in the United Kingdom. Tennyson
Securities and Stifel are each authorised and regulated in the
United Kingdom by the FCA. Each of the Joint Global Coordinators is
acting exclusively for the Company and for no one else in
connection with the Placing and will not regard any other person
(whether or not a recipient of this Announcement) as a client in
relation to the Placing and will not be responsible to anyone other
than the Company for providing the protections afforded to their
respective clients or for giving advice in relation to the Placing
or any other matters referred to in this Announcement.
DNB Bank ASA is authorised and regulated by the FCA. Mizuho and
RBC are authorised by the PRA and regulated by the PRA and the FCA
in the United Kingdom. KeyBanc is regulated by the U.S. Securities
and Exchange Commission and the Financial Industry Regulatory
Authority. CIBC, London Branch is supervised and regulated by the
Office of the Superintendent of Financial Institutions Canada and
in the UK is authorised by the PRA and subject to regulation by the
FCA and limited regulation by the PRA. Each of the Co-Lead Managers
is acting exclusively for the Company and for no one else in
connection with the Placing and will not regard any other person
(whether or not a recipient of this Announcement) as a client in
relation to the Placing and will not be responsible to anyone other
than the Company for providing the protections afforded to their
respective clients or for giving advice in relation to the Placing
or any other matters referred to in this Announcement.
This Announcement is being 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 or on
behalf of any of the Joint Global Coordinators or the Co-Lead
Managers (apart from the responsibilities or liabilities that may
be imposed by the Financial Services and Markets Act 2000, as
amended ("FSMA") or the regulatory regime established thereunder)
or by their respective affiliates or any of their respective
Representatives for the contents of this Announcement or any other
written or oral information made available to or publicly available
to any interested party or their respective advisers or any other
statement made or purported to be made by or on behalf of any of
the Joint Global Coordinators or the Co-Lead Managers or any of
their respective affiliates or any of their respective
Representatives in connection with the Company, the Placing Shares
or the Placing and any responsibility and liability whether arising
in tort, contract or otherwise therefor is expressly disclaimed.
No
representation or warranty, express or implied, is made by any
of the Joint Global Coordinators or the Co-Lead Managers or any of
their respective affiliates or any of their respective
Representatives as to the accuracy, fairness, verification,
completeness or sufficiency of the information or opinions
contained in this Announcement or any other written or oral
information made available to or publicly available to any
interested party or their respective advisers, and any liability
therefor is expressly disclaimed.
This Announcement does not constitute a recommendation
concerning any investor's options with respect to the Placing.
Recipients of this Announcement should conduct their own
investigation, evaluation and analysis of the business, data and
other information described in this Announcement. This Announcement
does not identify or suggest, or purport to identify or suggest,
the risks (direct or indirect) that may be associated with an
investment in the Placing Shares. The price and value of securities
can go down as well as up. Past performance is not a guide to
future performance. The contents of this Announcement are not to be
construed as legal, business, financial or tax advice. Each
investor or prospective investor should consult with his or her or
its own legal adviser, business adviser, financial adviser or tax
adviser for legal, business, financial or tax advice.
Any indication in this Announcement of the price at which the
Company's shares have been bought or sold in the past cannot be
relied upon as a guide to future performance. Persons needing
advice should consult an independent financial adviser. No
statement in this Announcement should be interpreted to mean that
earnings, earnings per share or income, cash flow from operations
or free cash flow of the Company for the current or future
financial periods would necessarily match or exceed the historical
published earnings, earnings per share or income, cash flow from
operations or free cash flow of the Company.
The Placing Shares to be issued pursuant to the Placing will not
be admitted to trading on any stock exchange other than the main
market for listed securities of the London Stock Exchange.
In connection with the Placing, the Joint Global Coordinators
and the Co-Lead Managers and any of their respective affiliates or
any of their respective Representatives, acting as investors for
their own account, may take up a portion of the Placing Shares in
the Placing as a principal position and in that capacity may
retain, purchase, sell, offer to sell for the own accounts or
otherwise deal for their own account in such Placing Shares and
other securities of the Company or related investments in
connection with the Placing or otherwise. Accordingly, references
to Placing Shares being offered, acquired, placed or otherwise
dealt in should be read as including any issue or offer to, or
acquisition, placing or dealing by, the Joint Global Coordinators
and the Co-Lead Managers and any of their respective affiliates and
their respective Representatives acting in such capacity. In
addition, the Joint Global Coordinators and the Co-Lead Managers
and any of their respective affiliates or their respective
Representatives may enter into financing arrangements (including
swaps, warrants or contracts for difference) with investors in
connection with which the Joint Global Coordinators and the Co-Lead
Managers and any of their respective affiliates may from time to
time acquire, hold or dispose of shares. The Joint Global
Coordinators and the Co-Lead Managers do not intend to disclose the
extent of any such investment or transactions otherwise than in
accordance with any legal or regulatory obligations to do so.
Appendix 1 to this Announcement sets out the terms and
conditions of the Placing. By participating in the Placing, each
Placee will be deemed to have read and understood this Announcement
(including Appendix 1 ) in its entirety, to be participating in the
Placing and making an offer to acquire and acquiring Placing Shares
on the terms and subject to the conditions set out in Appendix 1 to
this Announcement and to be providing the representations,
warranties, undertakings and acknowledgements contained in Appendix
1 to this Announcement.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this Announcement.
This Announcement has been prepared for the purposes of
complying with applicable law and regulation in the United Kingdom
and the information disclosed may not be the same as that which
would have been disclosed if this Announcement had been prepared in
accordance with the laws and regulations of any jurisdictions
outside the United Kingdom.
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 Placing Shares have been subject to a product approval
process, which has determined that such Placing 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
Placing Shares may decline and investors could lose all or part of
their investment; the Placing Shares offer no guaranteed income and
no capital protection; and an investment in the Placing 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 Placing. Furthermore, it is noted
that, notwithstanding the UK target market assessment, the Joint
Global Coordinators and the Co-Lead Managers 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
Placing Shares. Each distributor is responsible for undertaking its
own UK target market assessment in respect of the Placing 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 Placing Shares have been subject to a product approval process,
which has determined that such Placing 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 Placing Shares may decline and investors could lose all or
part of their investment; the Placing Shares offer no guaranteed
income and no capital protection; and an investment in the Placing
Shares is compatible only with investors who do not need a
guaranteed income or capital protection, who (either alone or in
conjunction with an appropriate financial or other adviser) are
capable of evaluating the merits and risks of such an investment
and who have sufficient resources to be able to bear any losses
that may result therefrom. The Target Market Assessment is without
prejudice to the requirements of any contractual, legal or
regulatory selling restrictions in relation to the Placing.
Furthermore, it is noted that, notwithstanding the Target Market
Assessment, the Joint Global Coordinators and the Co-Lead Managers
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 Placing Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
Dealing Codes:
Ticker: DEC .L
ISIN for the Ordinary Shares: GB00BYX7JT74
SEDOL for the Ordinary Shares: BYX7JT7
Company's legal entity identifier: 213800YR9TFRVHPGOS67
APPIX 1 - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT (INCLUDING APPIX 1 ) AND THE TERMS AND
CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") ARE FOR
INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS WHOSE
ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING
AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE
PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN
MATTERS RELATING TO INVESTMENTS AND ARE : (A) IF IN MEMBER STATES
OF THE EUROPEAN ECONOMIC AREA (THE "EEA"), PERSONS WHO ARE
QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(E) OF
REGULATION (EU) 2017/1129 (THE "PROSPECTUS REGULATION") ("QUALIFIED
INVESTORS"); OR (B) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS
WITHIN THE MEANING OF ARTICLE 2(E) OF THE UK VERSION OF REGULATION
(EU) 2017/1129 AS IT FORMS PART OF UK LAW BY VIRTUE OF THE EUROPEAN
UNION (WITHDRAWAL) ACT 2018 (THE "UK PROSPECTUS REGULATION") WHO
ARE (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"), OR (II) PERSONS WHO ARE HIGH NET WORTH COMPANIES,
UNINCORPORATED ASSOCIATIONS OR PARTNERSHIPS OR TRUSTEES OF HIGH
VALUE TRUSTS AS DESCRIBED IN ARTICLE 49(2)(A) TO (D) OF THE ORDER;
OR (c) OTHERWISE, PERSONS TO WHOM IT MAY OTHERWISE BE LAWFUL TO
COMMUNICATE IT TO (EACH SUCH PERSONS REFERRED TO ABOVE AS "RELEVANT
PERSONS"). NO OTHER PERSON SHOULD ACT OR RELY ON THIS ANNOUNCEMENT.
BY ACCEPTING THE TERMS OF THIS ANNOUNCEMENT YOU REPRESENT AND AGREE
THAT YOU ARE EITHER A QUALIFIED INVESTOR OR A RELEVANT PERSON. THIS
APPIX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED
ON OR RELIED ON BY PERSONS WHO ARE NOT QUALIFIED INVESTORS IN THE
EEA AND RELEVANT PERSONS IN THE UNITED KINGDOM. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH
THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN
RELATE IS AVAILABLE ONLY IN MEMBER STATES OF THE EEA TO QUALIFIED
INVESTORS AND IN THE UNITED KINGDOM TO RELEVANT PERSONS AND WILL BE
ENGAGED IN ONLY WITH QUALIFIED INVESTORS IN MEMBER STATES OF THE
EEA AND RELEVANT PERSONS IN THE UNITED KINGDOM.
THIS ANNOUNCEMENT (INCLUDING APPIX 1 ) DOES NOT ITSELF
CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN
THE COMPANY. EACH PLACEE (AS DEFINED BELOW) SHOULD CONSULT WITH ITS
OWN ADVISERS AS TO LEGAL, TAX, BUSINESS, FINANCIAL AND RELATED
ASPECTS OF A SUBSCRIPTION FOR THE PLACING SHARES (AS DEFINED
BELOW).
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT
FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY,
IN OR INTO THE UNITED STATES (INCLUDING ITS TERRITORIES AND
POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF
COLUMBIA (COLLECTIVELY, THE "UNITED STATES"), AUSTRALIA, CANADA,
SOUTH AFRICA, JAPAN OR ANY JURISDICTION IN WHICH SUCH RELEASE,
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL OR REQUIRE A
PROSPECTUS OR SIMILAR DOCUMENT TO BE FILED. THIS ANNOUNCEMENT AND
THE INFORMATION CONTAINED HEREIN DO NOT CONSTITUTE AN OFFER OF
SECURITIES FOR SALE IN THE UNITED STATES, AUSTRALIA, CANADA, SOUTH
AFRICA, JAPAN OR IN ANY OTHER JURISDICTION IN WHICH THE SAME WOULD
BE UNLAWFUL.
All offers of the Placing Shares will be made pursuant to an
exemption under the Prospectus Regulation and the UK Prospectus
Regulation from the requirement to produce a prospectus. This
Announcement is being distributed and communicated to persons in
the UK only in circumstances to which section 21(1) of the
Financial Services and Markets Act 2000, as amended ("FSMA") does
not apply.
The Placing Shares have not been and will not be registered
under the U.S. Securities Act of 1933, as amended (the "Securities
Act"), or under the securities laws of any state or other
jurisdiction of the United States. Accordingly, the Placing Shares
may not be offered, sold or transferred, directly or indirectly, in
or into 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 securities
laws of any state or other jurisdiction of the United States. The
Placing Shares are being offered and sold by the Company (A)
outside the United States in offshore transactions as defined in,
and pursuant to, Regulation S under the Securities Act ("Regulation
S") and (B) in the United States, save with the Company's
agreement, only to persons reasonably believed to be "qualified
institutional buyers" in transactions not involving a "public
offering" within the meaning of section 4(a)(2) of the Securities
Act pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act. There will
be no public offering of the Placing Shares in the United States,
the United Kingdom, Australia, Canada, South Africa, Japan or
elsewhere.
The Placing has not been approved and will not be approved or
disapproved by the United States Securities and Exchange
Commission, any state securities commission or any other regulatory
authority in the United States, nor have any of the authorities in
Australia, Canada, South Africa, Japan or any other jurisdiction in
which a registration statement or prospectus would be required to
be filed in connection with the Placing Shares passed upon or
endorsed the merits of the Placing or the accuracy or adequacy of
this Announcement. Any representation to the contrary is
unlawful.
Persons who are invited to and who choose to participate in the
placing (the "Placing") of new ordinary shares (the "Placing
Shares") by making an oral or written offer to acquire Placing
Shares, including any individuals, funds or others on whose behalf
a commitment to acquire Placing Shares is given ("Placees"), will
be deemed to: (i) have read and understood this Announcement
(including Appendix 1 ) in its entirety; and (ii) to be making (and
shall only be permitted to participate in the Placing on the basis
that they have made) such offer on the terms and conditions, and to
be providing the representations, warranties, indemnities,
acknowledgements, undertakings and agreements, contained in this
Appendix 1. In particular, each such Placee represents, warrants,
acknowledges and agrees that:
1. If it is in the United Kingdom it is a Relevant Person and if
it is in the member state of the EEA it is a Qualified Investor,
and undertakes that it will acquire, hold, manage or dispose of any
Placing Shares that are allocated to it for the purposes of its
business;
2. it is acquiring the Placing Shares for its own account or is
acquiring the Placing Shares for an account with respect to which
it exercises sole investment discretion and has the authority to
make and does make the representations, warranties, indemnities,
acknowledgments, undertakings and agreements contained in this
Announcement;
3. it understands (or if acting for the account of another
person, such person has confirmed that such person understands) the
resale and transfer restrictions set out in this Announcement
(including this Appendix 1);
4. if it is a financial intermediary, as that term is used in
Article 5(1) of the Prospectus Regulation and the UK Prospectus
Regulation, that it understands that any Placing Shares subscribed
for by it in the Placing will not be acquired on a
non-discretionary basis on behalf of, nor will they be acquired
with a view to their offer or resale to, persons in 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 United Kingdom to Relevant Persons, or in
circumstances in which the prior consent of the Joint Global
Coordinators has been given to each such proposed offer or
resale;
5. it understands that the Placing Shares have not been and will
not be registered under the Securities Act or with any securities
regulatory authority of any state or other jurisdiction of the
United States and may not be offered or sold, directly or
indirectly, 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;
6. it and the person(s), if any, for whose account or benefit it
is acquiring the Placing Shares are either (a)(i) outside the
United States and will be outside the United States at the time the
Placing Shares are acquired by it and (ii) acquiring the Placing
Shares in an "offshore transaction" in accordance with Rule 903 or
Rule 904 of Regulation S; or (b) save with the Company's agreement,
a "qualified institutional buyer" as defined in Rule 144A under the
Securities Act (a "QIB") acting for its own account or for the
account of one or more QIBs, each of which is acquiring beneficial
interests in the Placing Shares for its own account (if acquiring
the Placing Shares for the account of one or more other persons, it
has full power and authority to make the representations,
warranties, agreements and acknowledgements herein on behalf of
each such person) who has executed and delivered to the Company and
the Banks a US investor letter substantially in the form provided
to it; and
7. the Company, Credit Suisse Securities (Europe) Limited
("Credit Suisse"), Tennyson Securities, a trading name of Shard
Capital Partners LLP ("Tennyson Securities") and Stifel Nicolaus
Europe Limited ("Stifel" and, together with Credit Suisse and
Tennyson Securities, the "Joint Global Coordinators"), DNB Bank ASA
and DNB Markets, Inc. a subsidiary of DNB Bank ASA ("DNB Markets"),
Keybanc Capital Markets, a trade name for KeyBanc Capital Markets
Inc. ("Keybanc"), Mizuho International plc ("Mizuho"), Canadian
Imperial Bank of Commerce, a bank chartered under the Bank Act
(Canada), acting through its registered branch in the United
Kingdom ("CIBC, London Branch"). RBC Europe Limited ("RBC"), each
acting as co-lead managers (DNB Markets, Keybanc, Mizuho, CIBC,
London Branch and RBC together, the "Co-Lead Managers") (the
Co-Lead Managers together with the Joint Global Coordinators , the
"Banks") will rely upon the truth and accuracy of the foregoing
representations, warranties, acknowledgements and agreements.
None of the Company, the Banks or any of their respective
affiliates or any of their respective Representatives (as defined
below) makes any representation to any Placee regarding an
investment in the Placing Shares.
IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING
Details of the Placing Agreement and of the Placing Shares
The Joint Global Coordinators, the Co-Lead Managers and the
Company have today entered into a placing agreement (the "Placing
Agreement") under which, subject to the terms and conditions set
out therein, each of the Banks has agreed, severally and not
jointly or jointly and severally, as agent for and on behalf of the
Company, to use its reasonable endeavours to procure Placees for
new ordinary shares of one penny each in the capital of the Company
(the "Placing Shares") representing up to 19.99% of the Company's
existing issued share capital, with the number of Placing Shares
and price to be determined following completion of the bookbuilding
process in respect of the Placing (the "Placing Price"), and to the
extent any Placee defaults in paying the Placing Price in respect
of any Placing Shares allocated to it, each of the Joint Global
Coordinators has agreed, severally and not jointly or jointly and
severally, to subscribe for such Placing Shares at the Placing
Price.
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing ordinary
shares of one penny each in the capital of the Company (the
"Ordinary Shares"), including, without limitation, the right to
receive all dividends and other distributions declared, made or
paid in respect of the Ordinary Shares after Admission (as defined
below). The allotment and issue of the Placing Shares will be
effected by way of a placing of new Ordinary Shares in the Company
for non-cash consideration. Stifel will subscribe for ordinary
shares and redeemable preference shares in Project Silverstone
(Jersey) Limited ("JerseyCo"), a Jersey incorporated subsidiary of
the Company, for an amount equal to the product of the Placing
Price and the number of Placing Shares placed pursuant to the
Placing. The Company will allot and issue the Placing Shares on a
non-pre-emptive basis to Placees in consideration for the transfer
of the ordinary shares and redeemable preference shares in JerseyCo
that will be issued to Stifel . The proceeds raised through the
Placing (net of expenses) will be retained for the benefit of the
Company.
Applications for listing and admission to trading
Applications will be made for the Placing Shares to be admitted
to the premium listing segment of the Official List of the
Financial Conduct Authority (the "FCA") (the "Official List") and
to be admitted to trading on the main market for listed securities
of London Stock Exchange plc (the "London Stock Exchange")
(together, "Admission"). Settlement for the Placing Shares and
Admission is expected to take place on or before 8.00 a.m. (London
time) on 25 May 2021(or such later time and/or date as the Joint
Global Coordinators (on behalf of the Banks) may agree with the
Company) (the "Admission Date") and dealings in the Placing Shares
will commence at that time. The Placing is conditional upon, among
other things, Admission becoming effective and the Placing
Agreement not being terminated in accordance with its terms.
Bookbuild
Following this Announcement, the Banks will today commence an
accelerated bookbuilding process to determine demand for
participation in the Placing by Placees (the "Bookbuild"). This
Appendix 1 gives details of the terms and conditions of, and the
mechanics of participation in, the Placing. No commissions will be
paid to Placees or by Placees in respect of any Placing Shares.
Members of the public are not entitled to participate.
The Joint Global Coordinators and the Company shall be entitled
to effect the Placing by such alternative method to the Bookbuild
as they may, in their absolute discretion, determine.
Participation in, and principal terms of, the Placing
1. Each of the Joint Global Coordinators is acting as a joint
global coordinator, joint bookrunner and agent for the Company in
connection with the Placing.
2. Each of the Co-Lead Managers is acting as a co-lead manager
and agent for the Company in connection with the Placing.
3. Participation in the Placing will only be available to
persons who may lawfully be, and are, invited to participate by the
Banks. The Banks and their respective agents and affiliates are
entitled to enter bids in the Bookbuild as principal.
4. The Bookbuild, if successful, will establish a single price
per Placing Share payable to the Banks, as agents for and on behalf
of the Company, by all Placees whose bids are successful. The
Placing Price and the final number of Placing Shares will be
determined by the Company (in consultation with the Joint Global
Coordinators) following completion of the Bookbuild and any
discount to the market price of the Ordinary Shares will be
determined in accordance with the Listing Rules of the FCA. The
Placing Price and the final number of Placing Shares to be issued
will be announced on a Regulatory Information Service ("RIS")
following the completion of the Bookbuild.
5. To bid in the Bookbuild, prospective Placees should
communicate their bid by telephone or in writing to their usual
sales contact at any of the Banks. Each bid should state the number
of Placing Shares which the prospective Placee wishes to acquire at
either the Placing Price which is ultimately established by the
Company and the Joint Global Coordinators or at prices up to a
price limit specified in its bid. Bids may be scaled down by the
Joint Global Coordinators on the basis referred to in paragraph 8
below.
6. A bid in the Bookbuild will be made on the terms and subject
to the conditions in this Appendix 1 and will be legally binding on
the Placee on behalf of which it is made and, except with the Joint
Global Coordinators ' consent, will not be capable of variation or
revocation after the time at which it is submitted. Each Placee
will have an immediate, separate, irrevocable and binding
obligation, owed to the Banks, as agents for and on behalf of the
Company, to pay it in cleared funds immediately on the settlement
date, in accordance with the registration and settlement
requirements set out below, an amount equal to the product of the
Placing Price and the number of Placing Shares such Placee has
agreed to subscribe for and the Company has agreed to allot.
7. The Bookbuild is expected to close no later than 8.00 a.m.
(London time) on 21 May 2021 but may be closed earlier or later at
the discretion of the Joint Global Coordinators and the Company.
The Joint Global Coordinators may, in agreement with the Company,
accept bids that are received after the Bookbuild has closed.
8. Each prospective Placee's allocation will be agreed between
the Joint Global Coordinators and the Company and will be confirmed
orally or in writing (which can include email) by any of the Joint
Global Coordinators (as agent for and on behalf of the Company)
following the close of the Bookbuild and a trade confirmation will
be despatched thereafter. This oral confirmation to such Placee
will constitute an irrevocable legally binding commitment upon that
person (who will at that point become a Placee) in favour of the
Banks and the Company to acquire the number of Placing Shares
allocated to it at the Placing Price on the terms and conditions
set out in this Appendix 1 and in accordance with the Company's
articles of association and each Placee will be deemed to have read
and understood this Announcement (including Appendix 1 ) in its
entirety. The terms of this Appendix 1 will be deemed incorporated
by reference in the trade confirmation. All obligations under the
Bookbuild and Placing will be subject to fulfilment or, where
applicable, waiver of the conditions referred to below under
"Conditions of the Placing" and to the Placing not being terminated
on the basis referred to below under "Right to terminate under the
Placing Agreement". By participating in the Bookbuild, each Placee
will agree that its rights and obligations in respect of the
Placing will terminate only in the circumstances described below
and will not be capable of rescission or termination by the Placee
after confirmation (oral or otherwise) by any of the Banks.
9. The Joint Global Coordinators may choose to accept bids,
either in whole or in part, on the basis of allocations determined
in agreement with the Company and may scale down any bids for this
purpose on such basis as they may determine. The Joint Global
Coordinators may also, notwithstanding paragraphs 4 and 5 above,
and subject to the prior consent of the Company, (i) allocate
Placing Shares after the time of any initial allocation to any
person submitting a bid after that time; and (ii) allocate Placing
Shares after the Bookbuild has closed to any person submitting a
bid after that time. The Company reserves the right (upon
consultation with the Joint Global Coordinators) to reduce or seek
to increase the amount to be raised pursuant to the Placing, in its
absolute discretion.
10. Irrespective of the time at which a Placee's allocation
pursuant to the Placing is confirmed, settlement for all Placing
Shares to be acquired pursuant to the Placing will be required to
be made at the same time, on the basis explained below under
"Registration and settlement".
11. Except as required by law or regulation, no press release or
other announcement will be made by the Joint Global Coordinators or
the Company using the name of any Placee (or its agent), in its
capacity as Placee (or agent), other than with such Placee's prior
written consent.
12. To the fullest extent permissible by law, none of the Banks,
the Company or any of their respective affiliates or any of their
respective directors, officers, partners, employees, advisers or
agents (collectively, "Representatives") shall have any
responsibility or liability to Placees (or to any other person
whether acting on behalf of a Placee or otherwise). In particular,
none of the Banks, the Company or any of their respective
affiliates or any of their respective Representatives shall have
any liability (including to the fullest extent permissible by law,
any fiduciary duties) in respect of the conduct of the Bookbuild or
of such alternative method of effecting the Placing as the Banks
and the Company may agree.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming
unconditional and not having been terminated in accordance with its
terms. The obligations of the Banks under the Placing Agreement are
conditional on, amongst other things:
(a) Admission occurring by no later than 8.00 a.m. (London time)
on the Admission Date (or such later time or date the Joint Global
Coordinators may agree with the Company being not later than 8:30
a.m. (London Time) on 28 May 2021) ;
(b) the Company's representations and warranties contained in
the Placing Agreement being true and accurate and not misleading on
and as at the date of the Placing Agreement and at all times up to
Admission;
(c) the Company complying with its obligations and undertakings
under the Placing Agreement so far as the same fall to be performed
or satisfied on or prior to Admission ;
(d) each of the option agreement (to be entered into between the
Company, Stifel and JerseyCo) (the "Option Agreement") and the
subscription and transfer agreement (to be entered into between the
Company, Stifel and JerseyCo) (the "Subscription and Transfer
Agreement") having been executed by the Company and JerseyCo and
remaining in full force and effect and not having been terminated,
and there having occurred no default or breach by the Company or
JerseyCo of any of the terms thereof at any time immediately prior
to Admission;
(e) there not having occurred, since the date of the Placing
Agreement at any time prior to Admission, any material adverse
change; or
(f) no matter having arisen which might reasonably give be
expected to give rise to an indemnity claim under the Placing
Agreement .
The Joint Global Coordinators have discretion to waive
compliance with certain of the conditions and/or agree an extension
in time for their satisfaction.
If: (a) any of the conditions contained in the Placing
Agreement, including those described above, are not fulfilled (or,
where permitted, waived or extended in writing by the Joint Global
Coordinators) or have become incapable of fulfilment on or before
the date or time specified for the fulfilment thereof (or such
later time and/or date as the Company and the Joint Global
Coordinators may agree); or (b) the Placing Agreement is terminated
in the circumstances specified below, the Placing will not proceed
and the Placees' rights and obligations hereunder in relation to
the Placing Shares shall cease and terminate at such time and each
Placee agrees that no claim can be made by the Placee in respect
thereof. Any such extension or waiver will not affect Placees'
commitments as set out in this Announcement.
By participating in the Placing each Placee agrees that neither
the Banks nor any of their respective affiliates nor any of their
respective Representatives 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 they may make as to whether
or not to waive or to extend the time and/or the date for the
satisfaction of any condition to the Placing nor for any decision
they may make as to the satisfaction of any condition or in respect
of the Placing generally, and by participating in the Placing each
Placee agrees that any such decision is within the absolute
discretion of the Joint Global Coordinators.
Lock-up
The Company has agreed with the Joint Global Coordinators that,
subject to customary expectations, it will not, and will procure
that none of its subsidiaries will, between the date of the Placing
Agreement and 45 days after the date of the Placing Agreement,
without the prior written consent of the Joint Global Coordinators,
(a) issue, allot, offer, pledge, sell, contract to sell, pledge,
grant any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase,
lend or otherwise transfer or dispose of, directly or indirectly,
any Ordinary Shares or other shares in the capital of the Company
or any securities convertible into or exchangeable for Ordinary
Shares or other shares in the capital of the Company or (b) enter
into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of
Ordinary Shares or other shares in the capital of the Company,
whether any such transaction described in (a) or (b) above is to be
settled by delivery of Ordinary Shares or other shares in the
capital of the Company or such other securities, in cash or
otherwise.
Right to terminate under the Placing Agreement
Each of the Joint Global Coordinators , for itself in its
capacity as joint global co-ordinator and joint bookrunner, is
entitled, in its absolute discretion acting in good faith and after
consultation (to the extent reasonably practicable) with the
Company and the other Joint Global Coordinators , at any time
before Admission, to terminate the Placing Agreement by giving
notice to the Company if, amongst other things, (a) any of the
conditions to the Placing Agreement have not been satisfied or
(where permitted) waived, (b) any of the Company's representations
and warranties are not or cease to be true and accurate or have
become misleading; (c) there has been a breach by the Company of
any of its obligations or undertakings contained in the Placing
Agreement, the Option Agreement or the Subscription and Transfer
Agreement ; (d) since the date of the Placing Agreement, there has
been a material adverse change; or (e)there has occurred a market
disruption event as specified in the Placing Agreement. For the
avoidance of doubt, the Co-Lead Managers are entitled, at any time
before Admission, to terminate the Placing Agreement only in the
circumstances where one of the Joint Global Coordinators elects to
terminate the Placing Agreement on the conditions set out
above.
Upon such notice being given, such parties to the Placing
Agreement shall be released and discharged (except for any
liability arising before or in relation to such termination) from
their respective obligations under or pursuant to the Placing
Agreement, subject to certain exceptions. Each of the other Joint
Global Coordinators may, in its absolute discretion, elect by
giving notice to the Company to allow the Placing to proceed.
By participating in the Placing, Placees agree that the exercise
by any of the Joint Global Coordinators of any right of termination
or other discretion under the Placing Agreement shall be within the
absolute discretion of each of the Joint Global Coordinators, that
the Joint Global Coordinators do not need to make any reference to,
consult with, or seek consent from, Placees and that none of the
Company or the Joint Global Coordinators or the Co-Lead Managers or
any of their respective affiliates or any of their respective
Representatives shall have any liability to Placees whatsoever in
connection with any exercise or failure to exercise any right of
termination or other discretion.
No prospectus
No offering document, admission document or prospectus has been
or will be submitted to be approved by the FCA (or any other
authority) or submitted to the London Stock Exchange in relation to
the Placing or Admission and no such prospectus is required (in
accordance with the UK Prospectus Regulation) to be published in
the United Kingdom or any equivalent document in any other
jurisdiction .
Placees' commitments will be made solely on the basis of their
own assessment of the Company, the Placing Shares and the Placing
based on information contained in this Announcement (including
Appendix 1 ) released by the Company today and any information
publicly announced to a RIS by or on behalf of the Company on or
prior to the date of this Announcement and subject to the further
terms set forth in the trade confirmation to be provided to
individual prospective Placees.
Each Placee, by accepting a participation in the Placing, agrees
that the content of this Announcement (including Appendix 1 ) and
all other publicly available information previously and
simultaneously published by the Company by notification to a RIS is
exclusively the responsibility of the Company and confirms that it
has neither received nor relied on any other information,
representation, warranty, or statement made by or on behalf of the
Company or the Banks or any other person and none of the Company or
Banks or any of their respective affiliates or any of their
respective Representatives will be liable for any Placee's decision
to participate in the Placing based on any other information,
representation, warranty or statement which the Placee may have
obtained or received. Each Placee acknowledges and agrees that it
has relied on its own investigation of the business, financial or
other position of the Company in accepting a participation in the
Placing. Nothing in this paragraph shall exclude or limit the
liability of any person for fraudulent misrepresentation by that
person.
Registration and settlement
Settlement of transactions in the Placing Shares following
Admission, unless otherwise agreed, will take place within the
CREST system, subject to certain exceptions. The Joint Global
Coordinators and the Company reserve the right to require
settlement for and delivery of the Placing Shares (or a portion
thereof) to Placees in certificated form if delivery or settlement
is not possible or practicable within the CREST system or would not
be consistent with the regulatory requirements in the Placee's
jurisdiction.
Following the close of the Bookbuild, each Placee allocated
Placing Shares in the Placing will be sent a trade confirmation
stating the number of Placing Shares to be allocated to it at the
Placing Price and settlement instructions. Each Placee agrees that
it will do all things necessary to ensure that delivery and payment
is completed in accordance with the standing CREST or certificated
settlement instructions that it has in place with the relevant
Bank.
The Company will deliver the Placing Shares to a CREST account
operated by the Banks (or any one of them) as the Company's agent
and the relevant Bank will enter its delivery (DEL) instruction
into the CREST system. The input to CREST by a Placee of a matching
or acceptance instruction will then allow delivery of the relevant
Placing Shares to that Placee against payment.
It is expected that settlement will be on 25 May 2021 on a T+2
basis and on a delivery versus payment basis in accordance with the
instructions set out in the trade confirmation. Interest is
chargeable daily on payments not received from Placees on the due
date in accordance with the arrangements set out above at the rate
of two percentage points above LIBOR as determined by the Joint
Global Coordinators.
Each Placee is deemed to agree that, if it does not comply with
these obligations, the Banks (as agents for and on behalf of the
Company) may sell any or all of the Placing Shares allocated to
that Placee on such Placee's behalf and retain from the proceeds,
for the Company's account and benefit, an amount equal to the
aggregate amount owed by the Placee plus any interest due. The
relevant Placee will, however, remain liable for any shortfall
below the aggregate amount owed by it and may be required to bear
any stamp duty or stamp duty reserve tax or other similar taxes
(together with any interest or penalties) imposed in any
jurisdiction which may arise upon the sale of such Placing Shares
on such Placee's behalf. By communicating a bid for Placing Shares,
each Placee confirms on each of the Banks all such authorities and
powers necessary to carry out any such transaction and agrees to
ratify and confirm all actions which the Joint Global Coordinators
lawfully takes on such Placee's behalf.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the trade confirmation
is copied and delivered immediately to the relevant person within
that organisation.
Insofar as Placing Shares are registered in a Placee's name or
that of its nominee or in the name of any person for whom a Placee
is contracting as agent or that of a nominee for such person, such
Placing Shares should, subject as provided below, be so registered
free from any liability to UK stamp duty or stamp duty reserve tax.
If there are any other circumstances in which any stamp duty or
stamp duty reserve tax (and/or any interest, fines or penalties
relating thereto) is payable in respect of the allocation,
allotment, issue or delivery of the Placing Shares (or for the
avoidance of doubt if any stamp duty or stamp duty reserve tax is
payable in connection with any subsequent transfer of or agreement
to transfer Placing Shares), none of the Joint Global Coordinators,
the Co-Lead Managers or the Company shall be responsible for the
payment thereof. Placees shall not be entitled to receive any fee
or commission in connection with the Placing.
Representations and warranties and further terms
By submitting a bid and/or participating in the Placing each
prospective 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 Bank and the
Company, in each case as a fundamental term of its application for
Placing Shares), the following:
1. it has read and understood this Announcement, including this
Appendix, in its entirety and that its participation in the
Bookbuild and the Placing and its subscription for and purchase of
Placing Shares is subject to and based upon all the terms,
conditions, representations, warranties, indemnities,
acknowledgements, agreements and undertakings and other information
contained herein and undertakes not to redistribute or duplicate
this Announcement and it has not relied on, and will not rely on,
any other information given or any representations, warranties or
statements made at any time by any person in connection with
Admission, the Bookbuild, the Placing, the Company, the Placing
Shares or otherwise;
2. that no offering document, offering memorandum, admission
document or prospectus has been or will be prepared in connection
with the Placing or is required under the Prospectus Regulation or
UK Prospectus Regulation and it has not received and will not
receive a prospectus, offering memorandum, admission document or
other offering document in connection with the Bookbuild, the
Placing or the Placing Shares;
3. (i) it has made its own assessment of the Company, the
Placing Shares and the terms of the Placing based on this
Announcement (including Appendix 1 ) and any information publicly
announced to a Regulatory Information Service by or on behalf of
the Company prior to the date of this Announcement (the "Publicly
Available Information"); (ii) the Ordinary Shares are admitted to
the premium listing segment of the Official List of the FCA and to
trading on the London Stock Exchange's main market for listed
securities and the Company is therefore required to publish certain
business and financial information in accordance with the Market
Abuse Regulation (EU) No.596/2014 ("MAR"), in the period up to and
including 31 December 2020, and from 1 January 2021 in accordance
with the UK version of the Market Abuse Regulation (EU)
No.596/2014, which forms part of UK law by virtue of the European
Union (Withdrawal) Act 2018) ("UK MAR") and the rules and practices
of the London Stock Exchange (the "Exchange Information"), which
includes a description of the nature of the Company's business,
most recent balance sheet and profit and loss account, and similar
statements for preceding years, and it has reviewed such Exchange
Information as it has deemed necessary or that it is able to obtain
or access the Exchange Information without undue difficulty; and
(iii) it has had access to such financial and other information
(including the business, financial condition, prospects,
creditworthiness, status and affairs of the Company, the Placing
and the Placing Shares, as well as the opportunity to ask
questions) concerning the Company, the Placing and the Placing
Shares as it has deemed necessary in connection with its own
investment decision to acquire any of the Placing Shares and has
satisfied itself that the information is still current and relied
on that investigation for the purposes of its decision to
participate in the Placing;
4. that the content of this Announcement is exclusively the
responsibility of the Company and that neither the Bank nor any of
their respective affiliates nor any of their respective
Representatives nor any person acting on their behalf has or shall
have any responsibility or liability for any information,
representation or statement contained in this Announcement or any
information previously or subsequently published by or on behalf of
the Company, including, without limitation, any Exchange
Information, and will not be liable for any Placee's decision to
participate in the Placing based on any information, representation
or statement contained in this Announcement or any information
previously published by or on behalf of the Company or otherwise.
Each Placee further represents, warrants and agrees that the only
information on which it is entitled to rely and on which such
Placee has relied in committing itself to acquire the Placing
Shares is contained in this Announcement and any Publicly Available
Information including (without limitation) the Exchange
Information, such information being all that it deems necessary
and/or appropriate to make an investment decision in respect of the
Placing Shares, and that it has neither received nor relied on any
other information given or investigations, representations,
warranties or statements made by the Banks or the Company or any of
their respective affiliates or any of their respective
Representatives or any person acting on their behalf and neither
the Banks nor the Company
nor any of their respective affiliates, nor any of their
respective Representatives nor any person acting on their behalf
will be liable for any Placee's decision to accept an invitation to
participate in the Placing based on any other information,
representation, warranty or statement. Each Placee further
acknowledges and agrees that it has relied on its own investigation
of the business, financial or other position of the Company in
deciding to participate in the Placing;
5. (i) neither the Banks nor any of their respective affiliates
nor any of their respective Representatives nor any person acting
on their behalf have made any representations to it, express or
implied, with respect to the Company, the Bookbuild, the Placing
and the Placing Shares or the accuracy, completeness or adequacy of
the Publicly Available Information or the Exchange Information, and
each of them expressly disclaims any liability in respect thereof;
and (ii) it will not hold the Banks or any of their respective
affiliates or any of their respective Representatives or any person
acting on their behalf responsible for any misstatements in or
omissions from the Publicly Available Information or the Exchange
Information. Nothing in this paragraph or otherwise in this
Announcement excludes the liability of any person for fraudulent
misrepresentation made by that person;
6. none of the Banks or the Company or any of their respective
affiliates or any of their respective Representatives or any person
acting on behalf of any of them has provided, and none of them will
provide, to it any material regarding the Placing Shares or the
Company or any other person other than this Announcement, nor has
it requested that any of the Joint Global Coordinators, the
Company, any of their respective affiliates, any of their
respective Representatives or any person acting on behalf of any of
them to provide it with any such material;
7. it understands, and each account it represents has been
advised that, (i) the Placing Shares have not been and will not be
registered under the Securities Act or with any regulatory
authority of any state or other jurisdiction of the United States;
(ii) the Placing Shares are being offered and sold only (a) subject
to certain exceptions, to persons reasonably believed to be QIBs in
transactions exempt from, the registration requirements of the
Securities Act or (b) in an "offshore transaction" within the
meaning of and pursuant to Regulation S under the Securities Act;
(iii) the Placing Shares may only be reoffered or resold in
transactions exempt from, or not subject to, the registration
requirements of the Securities Act and no representation has been
made as to the availability of any exemption under the Securities
Act or any relevant state or other jurisdiction's securities laws
for the reoffer, resale, pledge or transfer of the Placing Shares;
and (iv) a prospectus will not be published in respect of any of
the Placing Shares under the Securities Act or the securities laws
of any state or other jurisdiction of the United States;
8. it is not an affiliate (as defined in Rule 501(b) under the
Securities Act) of the Company, and is not acting on behalf of an
affiliate of the Company;
9. the Placing Shares offered and sold in the United States are
"restricted securities" within the meaning of Rule 144(a)(3) under
the Securities Act and for so long as the Placing Shares are
restricted securities, it will segregate such Placing Shares from
any other shares in the Company that it holds that are not
restricted securities, will not deposit the Placing Shares into any
depositary receipt facility maintained by any depositary bank in
respect of the Company's ordinary shares and will notify any
subsequent transferee of such Placing Shares of the applicable
transfer restrictions;
10. it will not distribute, forward, transfer or otherwise
transmit this Announcement or any other materials concerning the
Placing (including any electronic copies thereof), in or into the
United States (including electronic copies thereof) to any person,
and it has not distributed, forwarded, transferred or otherwise
transmitted any such materials to any person ;
11. it is not, and at the time the Placing Shares are acquired,
neither it nor the beneficial owner of the Placing Shares will be,
a resident of Australia (unless paragraph 12 below applies),
Canada, Japan or South Africa and further acknowledges that the
Placing Shares have not been and will not be registered under the
securities legislation of Australia, Canada, Japan or South Africa
and, subject to certain exceptions, may not be offered, sold,
transferred, delivered or distributed, directly or indirectly, in
or into those jurisdictions;
12. if it is receiving the offer to acquire the Placing Shares
in Australia, it is (i) a "sophisticated investor" within the
meaning of section 708(8) of the Australian Corporations Act 2001
(Cth) (the "Corporations Act") or a "professional investor" within
the meaning of section 708(11) of the Corporations Act and a
wholesale client under section 761G(7) of the Corporations Act and
the issue of the Placing Shares to it under the Placing does not
require a prospectus or other form of disclosure document under the
Corporations Act, and no Placing Shares may be offered for sale (or
transferred, assigned or otherwise alienated) to investors in
Australia for at least 12 months after their issue, except in
circumstances where disclosure to investors is not required under
Part 6D.2 of the Corporations Act;
13. if it received any "inside information" as defined in the UK
MAR concerning the Company or its shares or other securities or
related financial instruments in advance of the Placing, 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 except as
permitted by UK MAR, prior to the information being made publicly
available;
14. it has complied with its obligations under the Criminal
Justice Act 1993, MAR, UK MAR, any delegating acts, implementing
acts, technical standards and guidelines and Section 118 of FSMA
thereunder, and in connection with money laundering and terrorist
financing under the Proceeds of Crime Act 2002 (as amended), the
Terrorism Act 2000 (as amended), the Terrorism Act 2006, and the
Money Laundering, Terrorist Financing and Transfer of Funds
(Information on the Payer) Regulations 2017 (as amended) (the
"Regulations") and the Money Laundering Sourcebook of the FCA and,
if making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations. If
within a reasonable time after a request for verification of
identity, the Joint Global Coordinators have not received such
satisfactory evidence, the Joint Global Coordinators may, at their
absolute discretion, terminate the Placee's Placing participation
in which event all funds delivered by the Placee to the Banks will
be returned without interest to the account of the drawee bank or
CREST account from which they were originally debited;
15. if it is in the United Kingdom it is a Relevant Person and
if it is in a member state of the EEA it is a Qualified Investor
and undertakes that it will subscribe for, hold, manage or dispose
of any Placing Shares that are allocated to it for the purposes of
its business;
16. it understands that any investment or investment activity to
which this Announcement relates is available only to Relevant
Persons in the United Kingdom and Qualified Investors in a member
state of the EEA and will be engaged in only with Relevant Persons
in the United Kingdom and Qualified Investors in a member state of
the EEA, and further understands that this Announcement must not be
acted on or relied on by persons who are not Relevant Persons in
the United Kingdom and Qualified Investors in a member state of the
EEA;
17. if it is a financial intermediary, as that term is used in
Article 5(1) of the Prospectus Regulation and Article 5(1) of the
UK Prospectus Regulation, that the Placing Shares subscribed for by
it in the Placing 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 Qualified Investors or persons in the UK other than
Relevant Persons, or in circumstances in which the prior consent of
the Joint Global Coordinators has been given to the proposed offer
or resale;
18. that it has not offered or sold and will not offer or sell
any Placing Shares to persons in the United Kingdom, except to
Relevant Persons or otherwise in circumstances which have not
resulted and which will not result in an offer to the public in the
United Kingdom within the meaning of section 85(1) of the FSMA;
19. that any offer of Placing Shares may only be directed at
persons in member states of the EEA who are Qualified Investors and
represents, warrants and undertakes that it has not offered or sold
and will not offer or sell any Placing Shares to persons in the EEA
prior to Admission except to Qualified Investors or otherwise in
circumstances which have not resulted in and which will not result
in an offer to the public in any member state of the EEA within the
meaning of the Prospectus Regulation;
20. 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 Placing Shares in circumstances
in which section 21(1) of FSMA does not require approval of the
communication by an authorised person;
21. it has complied and will comply with all applicable laws
(including all relevant provisions of FSMA) with respect to
anything done by it in relation to the Placing Shares;
22. if in the United Kingdom, it is a Qualified Investor within
the meaning of Article 2(e) of the UK Prospectus Regulation and is
also a person (i) having professional experience in matters
relating to investments and who falls within the definition of
"investment professionals" in Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (as
amended) (the "Order"); or (ii) who falls within Article 49(2)(a)
to (d) of the Order; or (iii) to whom this Announcement may
otherwise lawfully be communicated;
23. if it is in a member state of the EEA, it is a Qualified Investor;
24. if in the United Kingdom, unless otherwise agreed by the
Joint Global Coordinators , it is a "professional client" or an
"eligible counterparty" within the meaning of Chapter 3 of the
FCA's Conduct of Business Sourcebook and it is acquiring Placing
Shares for investment only and not with a view to resale or
distribution;
25. no action has been or will be taken by either the Company or
the Banks or any person acting on behalf of the Company or the
Banks that would, or is intended to, permit a public offer of the
Placing Shares in any country or jurisdiction where any such action
for that purpose is required;
26. neither it, nor the person specified by it for registration
as holder of Placing Shares is, or is acting as nominee or agent
for, and the Placing Shares will not be allotted to, a person who
is or may be liable to stamp duty reserve tax under any of sections
67, 70, 93 and 96 of the Finance Act 1986 (depository receipts and
clearance services) and the Placing Shares are not being acquired
in connection with arrangements to issue depository receipts or to
issue or transfer Placing Shares into a clearance system;
27. (i) it is acting as principal in respect of the Placing and
has the power and authority to carry on the activities in which it
is engaged, to subscribe for Placing Shares and to execute and
deliver all documents necessary for such subscription; and/or (ii)
if it is acting for any other person (A) it is duly authorised to
do so and has full power to make the acknowledgments,
representations, undertakings and agreements and give the
indemnities herein on behalf of each such person; and (B) it is and
will remain liable to the Company and/or the Banks for the
performance of all its obligations as a Placee in respect of the
Placing (regardless of the fact that it is acting for another
person). Each Placee agrees that the provisions of this paragraph
shall survive the resale of the Placing Shares by or on behalf of
any person for whom it is acting;
28. if it is a pension fund or investment company, its
acquisition of Placing Shares is in full compliance with applicable
laws and regulations;
29. (i) it and any person acting on its behalf is entitled to
subscribe for the Placing Shares under the laws of all relevant
jurisdictions which apply to it; (ii) it has paid any issue,
transfer or other taxes due in connection with its participation in
any territory; (iii) it has fully observed such laws and obtained
all such governmental and other guarantees, permits,
authorisations, approvals and consents which may be required
thereunder and complied with all necessary formalities and that it
has not taken any action or omitted to take any action which will
or may result in the Banks or the Company or any of their
respective affiliates or any of their respective Representatives
acting in breach of the legal or regulatory requirements of any
jurisdiction in connection with the Placing; and (iv) the
subscription of the Placing Shares by it or any person acting on
its behalf will be in compliance with applicable laws and
regulations in the jurisdiction of its residence, the residence of
the Company, or otherwise;
30. it (and any person acting on its behalf) has the funds
available to pay for, and has all necessary capacity and has
obtained all necessary consents and authorities to enable it to
commit to its participation in the Placing 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 this Announcement) and will honour such obligations;
31. it (and any person acting on its behalf) will make payment
for the Placing Shares allocated to it in accordance with the terms
and conditions of this Announcement (including Appendix 1 ), on the
due time and date set out herein, failing which the relevant
Placing Shares may be placed with other persons or sold as the
Joint Global Coordinators may in their absolute discretion
determine and without liability to such Placee, and it will remain
liable for any amount by which the net proceeds of such sale falls
short of the product of the Placing Price and the number of Placing
Shares allocated to it and may be required to bear any stamp duty
or stamp duty reserve tax or other similar taxes (together with any
interest or penalties due pursuant to the terms set out or referred
to in this Announcement) which may arise upon the sale of such
Placee's Placing Shares on its behalf;
32. its allocation (if any) of Placing Shares will represent a
maximum number of Placing Shares which it will be entitled, and
required, to acquire, and that the Joint Global Coordinators or the
Company may call upon it to acquire a lower number of Placing
Shares (if any), but in no event in aggregate more than the
aforementioned maximum;
33. the person whom it specifies for registration as holder of
the Placing Shares will be (i) itself or (ii) its nominee, as the
case may be. Neither the Banks nor the Company will be responsible
for any liability to stamp duty or stamp duty reserve tax or other
similar taxes resulting from a failure to observe this requirement.
Each Placee and any person acting on behalf of such Placee agrees
to indemnify and hold harmless the Company, each of the Banks,
their respective affiliates and any of their respective
Representatives in respect of the same on an after-tax basis on the
basis that the Placing Shares will be allotted to the CREST stock
account of the Joint Global Coordinators (or any one of them) who
will hold them as nominee on behalf of such Placee until settlement
in accordance with its standing settlement instructions;
34. the Placing does not constitute a recommendation or
financial product advice and the Banks have not had regard to its
particular objectives, financial situation and needs;
35. none of the Banks, any of their respective affiliates, any
of their respective Representatives or any person acting on behalf
of any of them, is making any recommendations to it or, advising it
regarding the suitability of any transactions it may enter into in
connection with the Placing and that participation in the Placing
is on the basis that it is not and will not be a client of any of
the Banks and that the Banks do not have any duties or
responsibilities to it for providing the protections afforded to
their respective clients or customers or for providing advice in
relation to the Placing or in respect of any representations,
warranties, undertakings or indemnities contained in the Placing
Agreement or for the exercise or performance of any of their rights
and obligations thereunder including any rights to waive or vary
any conditions or exercise any termination right;
36. that in making any decision to acquire the Placing Shares
(i) it has such knowledge, sophistication and experience in
financial, business and international investment matters as is
required to evaluate the merits and risks of subscribing for or
acquire the Placing Shares, (ii) it is experienced in investing in
securities of this nature in this sector and is aware that it may
be required to bear, and is able to bear, the economic risk of
participating in, and is able to sustain a complete loss in
connection with, the Placing, (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
Company and its affiliates operate, and the terms of the Placing,
including the merits and risks involved and not upon any view
expressed or information provided by or on behalf of any of the
Banks, (iv) it has had sufficient time and access to information to
consider and conduct its own investigation with respect to the
offer and purchase of the Placing Shares, including the legal,
regulatory, tax, business, currency and other economic and
financial considerations relevant to such investment and has so
conducted its own investigation to the extent it deems necessary to
enable it to make an informed and intelligent decision with respect
to making an investment in the Placing Shares , (v) it is aware and
understands that an investment in the Placing Shares involves a
considerable degree of risk and (vi) it will not look to the
Company, the Banks, any of their respective affiliates, any of
their respective Representatives or any person acting on their
behalf for all or part of any such loss or losses it or they may
suffer;
37. in connection with the Placing, any of the Banks and any of
its or their respective affiliates or their respective
Representatives acting as an investor for its own account may take
up a portion of the Placing Shares and in that capacity may
acquire, retain, purchase or sell for its own account such Placing
Shares in the Company and any securities of the Company or related
investments and may offer or sell such securities or other
investments otherwise than in connection with the Placing.
Accordingly, references in this Announcement to shares being
issued, offered or placed should be read as including any issue,
offering or placement of such shares in the Company to the Banks or
their respective affiliates or their respective Representatives
acting in such capacity. In addition the Banks may enter into
financing arrangements and swaps with investors in connection with
which the Banks may from time to time acquire, hold or dispose of
such securities of the Company, including the Placing Shares. None
of the Banks intend to disclose the extent of any such investment
or transactions otherwise than in accordance with any legal or
regulatory obligation to do so;
38. it acknowledges that it irrevocably appoints any director or
authorised signatories of the Banks 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 to be registered
as the holder of any of the Placing Shares agreed to be taken up by
it under the Placing;
39. its commitment to acquire the Placing Shares on the terms
set out herein and in the trade confirmation will continue
notwithstanding any amendment that may in future be made to the
terms and conditions of the Placing and Placees will have no right
to be consulted or require that their consent be obtained with
respect to the Company's or the Joint Global Coordinators' '
conduct of the Placing;
40. the terms and conditions and any agreements entered into by
it pursuant to these terms and conditions and any non-contractual
obligations arising out of or in connection with such agreements
shall be governed by and construed in accordance with the laws of
England and it submits (on behalf of itself and on behalf of any
person 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 agreements and such non-contractual
obligations, except that enforcement proceedings in respect of the
obligation to make payment for the Placing Shares (together with
any interest chargeable thereon) may be taken by the Company or the
Banks 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;
41. it will indemnify on an after-tax basis and hold each of the
Company and the Banks and their respective affiliates and their
respective Representatives harmless from any and all costs, claims,
liabilities and expenses (including legal fees and expenses)
arising out of, directly or indirectly, or in connection with any
breach of the representations, warranties, acknowledgements,
agreements and undertakings in this Appendix 1 and further agrees
that the provisions of this Appendix 1 shall survive after
completion of the Placing;
42. neither the Company nor the Banks owes any fiduciary or
other duties to any Placee in respect of any acknowledgements,
confirmations, undertakings, representations, warranties or
indemnities in the Placing Agreement; and
43. the Company, the Banks and their respective affiliates and
their respective Representatives and others will rely upon the
truth and accuracy of the representations, warranties,
acknowledgements, indemnities, undertakings and agreements set
forth herein and which are given to each of the Banks and the
Company (for their own benefit and, where relevant, the benefit of
their respective affiliates and any person acting on their behalf)
and are irrevocable and it irrevocably authorises the Company and
the Banks to produce this Announcement, pursuant to, in connection
with, or as may be required by any applicable law or regulation,
administrative or legal proceeding or official inquiry with respect
to the matters set forth herein. It agrees that if any of the
acknowledgements, representations, warranties, undertakings and
agreements made in connection with its subscribing and/or acquiring
of Placing Shares is no longer accurate, it shall promptly notify
the Company and the Banks.
Each Placee not acquiring the Placing Shares in an "offshore
transaction" pursuant to Regulation S (each a "US Placee") shall
make specific representations, warranties, agreements and
acknowledgements pursuant to a US investor representation letter.
Each US Placee acknowledges that it will not be permitted to
purchase, subscribe for or otherwise take up Placing Shares unless
it has signed and returned such representation letter in accordance
with the terms thereof.
Please also note that the agreement to allot and issue Placing
Shares to Placees (or the persons for whom Placees are contracting
as agent) free of stamp duty and stamp duty reserve tax relates
only to their allotment and issue to Placees, or such persons as
they nominate as their agents, direct from the Company for the
Placing Shares in question. Such agreement is subject to the
representations, warranties and further terms above and assumes and
is based on the warranty and representation from each Placee that
the Placing Shares are not being subscribed for in connection with
arrangements to issue depositary receipts or to issue or transfer
the Placing Shares into a clearance service. If there are any such
arrangements, or the settlement relates to any other dealing in the
Placing Shares, stamp duty or stamp duty reserve tax or other
similar taxes may be payable, for which none of the Company or the
Banks will be responsible and each Placee shall indemnify on an
after-tax basis and hold harmless the Company and the Banks and
their respective affiliates and their respective Representatives
for any stamp duty or stamp duty reserve tax paid by them in
respect of any such arrangements or dealings. If this is the case,
each Placee should seek its own advice and notify the Banks
accordingly.
None of the Company or the Banks is liable to bear 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 in or
outside the United Kingdom by any Placee or any other person on a
Placee's acquisition of any Placing Shares or the agreement by a
Placee to acquire any Placing Shares. Each Placee agrees to
indemnify on an after-tax basis and hold harmless the Company, the
Banks, their respective affiliates and their respective
Representatives from any and all such stamp, issue, securities,
transfer, registration, documentary or other duties or taxes
(including interest, fines or penalties relating thereto). Each
Placee should seek its own advice as to whether any of the above
tax liabilities arise and notify the Banks accordingly.
In this Announcement, "after-tax basis" means in relation to any
payment made to the Company or the Banks or their respective
affiliates or their respective Representatives pursuant to this
Announcement where the payment (or any part thereof) is chargeable
to any tax, a basis such that the amount so payable shall be
increased so as to ensure that after taking into account any tax
chargeable (or which would be chargeable but for the availability
of any relief unrelated to the loss, damage, cost, charge, expense
or liability against which the indemnity is given on such amount
(including on the increased amount) there shall remain a sum equal
to the amount that would otherwise have been so payable.
Each Placee, and any person acting on behalf of each Placee,
acknowledges and agrees that the Banks and/or any of their
respective affiliates and/or any of their respective
Representatives may, at their absolute discretion, agree to become
a Placee in respect of some or all of the Placing Shares. Each
Placee acknowledges and is aware that each of the Banks is
receiving a fee in connection with its role in respect of the
Placing as detailed in the Placing Agreement. An affiliate of
Credit Suisse is a party to a credit facility of the Company and,
in the event that the Company determines to use the net proceeds of
the Proposed Fundraising to pay down its debt, it may receive a
portion of net proceeds in connection with such pay down.
When a Placee or person acting on behalf of the Placee is
dealing with any of the Banks, any money held in an account with
the relevant Joint Global Coordinator 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 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 relevant Bank's money in accordance with the
client money rules and will be used by the relevant Joint Global
Coordinator in the course of its own business; and the Placee will
rank only as a general creditor of such Bank.
All times and dates in this Announcement may be subject to
amendment by the Banks and the Company (in their absolute
discretion).The Banks shall notify the Placees and any person
acting on behalf of the Placees of any changes.
Past performance is no guide to future performance and persons
needing advice should consult an independent financial adviser.
The rights and remedies of the Banks and the Company under these
terms and conditions are in addition to any rights and remedies
which would otherwise be available to each of them and the exercise
or partial exercise of one will not prevent the exercise of
others.
PRESENTATION OF FINANCIAL AND OTHER INFORMATION
Non-IFRS financial measures
The Company presents certain key operating metrics that are not
defined under IFRS (alternative performance measures) in this
Announcement. These non-IFRS measures are used by the Company to
monitor the underlying performance of the Company's performance
from period to period and to facilitate comparison with its peers.
Since not all companies calculate these or other non-IFRS metrics
in the same way, the manner in which the Company has chosen to
calculate the non-IFRS metrics presented herein may not be
compatible with similarly defined terms used by other companies.
Therefore, the non-IFRS metrics should not be considered in
isolation of, or viewed as substitutes for, the financial
information prepared in accordance with IFRS. Certain of the key
operating metrics set forth below are based on information derived
from the Company's regularly maintained records and accounting and
operating systems.
EBITDA (hedged) and EBITDA (unhedged)
EBITDA is defined by the Company as earnings before interest,
tax, depreciation and amortisation.
Adjusted EBITDA (hedged) and Adjusted EBITDA (unhedged) are
defined by the Company as earnings before interest, taxes,
depletion, depreciation and amortisation and adjustments for
non-recurring items such as gain on the sale of assets, acquisition
related expenses and integration costs, mark-to-market adjustments
related to the Company's hedge portfolio, non-cash equity
compensation charges and items of a similar nature. The Directors
believe that Adjusted EBITDA (hedged) and Adjusted EBITDA
(unhedged) are useful measures as they enable a more effective way
to evaluate operating performance and compare the results of
operations from period-to-period and against its peers without
regard to the Company's financing methods or capital structure. The
Company excludes the items listed in the table below from operating
profit in arriving at Adjusted EBITDA (hedged) and Adjusted EBITDA
(unhedged) because these amounts can vary substantially from
company to company within the industry, depending upon accounting
methods and book values of assets, capital structures and the
method by which the assets were acquired.
Operating Margin
Operating Margin is defined as total realised price less total
cash costs and Percentage Operating Margin is defined as the
Operating Margin as a percentage of total realised price.
Free Cash Flow (adjusted)
Free Cash Flow (adjusted) is defined by the Company as Adjusted
EBITDA (hedged) further adjusted for capital expenditures, plugging
costs and cash paid for interest. The Directors view Free Cash Flow
(adjusted) as a key liquidity measure, as this measure represents
the amount of discretionary cash available to service debt
principal, pay dividends and to possibly buyback stock shares.
Leverage (hedged) and Leverage (unhedged)
Leverage is calculated by dividing Adjusted EBITDA (hedged) and
Adjusted EBITDA (unhedged) (as defined above) of the Company for
the last 12 months by Net Debt at the period end. The Directors
view leverage as a key measure of the Company's ability to pay off
its debt as well as it being used in the covenant calculations for
the Company's external borrowings.
Net Debt
Net Debt is defined as the sum of Company's borrowings,
excluding leases, less cash and cash equivalents.
Revenue (hedged)
Revenue (hedged) is defined as revenue adjusted for impact of
any gains/losses on derivative settlements.
Market, industry and other statistical data
This Announcement relies on and refers to information regarding
the Company's business and the markets in which the markets in
which the Company operates and competes. The market data and
certain economic and industry data and forecasts used in this
Announcement were obtained from governmental and other publicly
available information, independent industry publications and
reports prepared by industry consultants, including Energy
Information Administration and FactSet.
Industry publications, surveys and forecasts generally state
that the information contained therein has been obtained from
sources believed to be reliable, but that there can be no assurance
as to the accuracy and completeness of such information. The
Company believes that these industry publications, surveys and
forecasts are reliable, but they have not been independently
verified from third party sources.
All such data sourced from third parties contained in this
Announcement have been accurately reproduced and, so far as the
Company is aware and is able to ascertain from information
published by that third party, no facts have been omitted that
would render the reproduced information inaccurate or misleading.
No material changes have occurred since the date of the Competent
Person's Report available on the Company's website at
www.div.energy, the omission of which would make the Competent
Person's Report misleading.
The Company cannot assure you that any of the assumptions
underlying any statements regarding the gas and oil industry are
accurate or correctly reflect the Company's position in the
industry. Market data and statistics are inherently predictive and
speculative and are not necessarily reflective of actual market
conditions. Such statistics are based on market research, which
itself is based on sampling and subjective judgments by both the
researchers and the respondents, including judgments about what
types of products and transactions should be included in the
relevant market. In addition, the value of comparisons of
statistics for different markets is limited by many factors,
including that (i) the markets are defined differently, (ii) the
underlying information was gathered by different methods and (iii)
different assumptions were applied in compiling the data.
Accordingly, the market statistics included in this Announcement
should be viewed with caution and no representation or warranty is
given by any person as to their accuracy.
Elsewhere in this Announcement, statements regarding the gas and
oil industry are not based on published statistical data or
information obtained from independent third parties, but are based
solely on the Company's experience, its internal studies and
estimates, and its own investigation of market conditions. The
Company cannot assure you that any of these studies or estimates
are accurate, and none of the Company's internal surveys or
information have been verified by any independent sources. While
the Company is not aware of any misstatements regarding its
estimates presented herein, the Company's estimates involve risks,
assumptions and uncertainties and are subject to change based on
various factors.
Forward-looking statements
This Announcement includes forward-looking statements. These
forward-looking statements involve known and unknown risks and
uncertainties, many of which are beyond the Company's control and
all of which are based on management's current beliefs and
expectations about future events. Forward-looking statements are
sometimes identified by the use of forward-looking terminology such
as "believe", "expects", "targets", "may", "will", "could",
"should", "shall", "risk", "intends", "estimates", "aims", "plans",
"predicts", "continues", "assumes", "positioned" or "anticipates"
or the negative thereof, other variations thereon or comparable
terminology. These forward-looking statements include all matters
that are not historical facts. They appear in a number of places
throughout this Announcement and include statements regarding the
intentions, beliefs or current expectations of management or the
Company concerning, among other things, the results of operations,
financial condition, prospects, growth, strategies and dividend
policy of the Company and the industry in which it operates. In
particular, the statements included in the sections entitled "Risk
Factors" and "Business" of this Announcement regarding the
Company's strategy, targets and expectations in respect of the
Company's expected revenue, profit, growth, accounting tax rates,
and capital expenditure upon the operating results of the Company
as well as other expressions of the Company's targets and
expectations and other future events or prospects are
forward-looking statements.
No incorporation of website information
Save for the Competent Person's Report, information contained on
the Company's website or the contents of any website accessible
from hyperlinks on the Company's website are not incorporated into
and do not form part of this Announcement.
DEFINITIONS
The following definitions apply throughout this Announcement
unless the context requires otherwise:
"Acquisitions" the Indigo Acquisition and the Blackbeard
Acquisition;
"Adjusted EBITDA" earnings before interest, taxes, depletion,
depreciation and amortisation and adjustments
for non-recurring items such as gain
on the sale of assets, acquisition related
expenses and integration costs, mark-to-market
adjustments related to the Company's
hedge portfolio, non-cash equity compensation
charges and items of a similar nature;
"Admission" the admission of all of the issued to
the premium listing segment of the Official
List and to trading on the London Stock
Exchange's main market for listed securities
becoming effective in accordance with,
respectively, the Listing Rules and the
London Stock Exchange's standards for
admission and disclosure for securities
(as amended from time to time);
"Announcement" this announcement (including the appendices);
"Articles" the articles of association of the Company,
from time to time;
"Blackbeard" Blackbeard Operating, LLC;
"Blackbeard Acquisition" the signing of a conditional Purchase
and Sale Agreement to acquire certain
upstream and midstream assets in its
newly identified Central Regional Focus
Area from Blackbeard Operating, LLC;
"Bookbuild" accelerated bookbuild process;
"Central RFA" Central Regional Focus Area;
"CAGR" compound annual growth rate;
"cents" US cents;
"Co-Lead Managers" DNB Bank ASA and DNB Markets, Inc. a
subsidiary of DNB Bank ASA, Keybanc Capital
Markets, a trade name for KeyBanc Capital
Markets Inc., Mizuho International plc,
Canadian Imperial Bank of Commerce, a
bank chartered under the Bank Act (Canada),
acting through its registered branch
in the United Kingdom and RBC Europe
Limited;
"Company" Diversified Energy Company plc;
"Credit Suisse" Credit Suisse Securities (Europe) Limited;
"Directors" the directors of the Company;
"EBITDA" earnings before interest, tax, depreciation
and amortisation;
"Enlarged Share Capital" the existing Ordinary Shares in the Company
plus the additional Ordinary Shares to
be issued pursuant to the Proposed Fundraising;
"Fundraising Shares" the new Ordinary Shares issued pursuant
to the Placing and Retail Offer;
"Indigo" Indigo Minerals LLC;
"Indigo Acquisition" the conditional acquisition of certain
Cotton Valley upstream assets and related
facilities located in the "Central" Regional
Focus Area from Indigo Minerals LLC;
"Joint Global Coordinators" Stifel Nicolaus Europe Limited, Tennyson
Securities Limited and Credit Suisse
Securities (Europe) Limited;
"Net Debt" Total debt less cash and restricted cash;
"NTM" Next Twelve Months;
"Ordinary Shares" ordinary shares of GBP0.01 each in the
share capital of the Company;
"Placing" placing of new ordinary shares in the
capital of the Company to be conducted
through an accelerated bookbuild process
outside the United States, which will
launch immediately following the release
of this announcement;
"Proposed Fundraising" the Placing and the Retail Offer;
"Q4 Dividend" Q4 2020 dividend;
"RCF" Revolving Credit Facility;
"Retail Offer" an offer by the Company to on the PrimaryBid
Platform of new Ordinary Shares;
"Securities Act" the US Securities Act of 1933, as amended;
"Shareholders" holders of Ordinary Shares;
"Significant Shareholders" the Shareholder who owns more than 3
per cent. of the issued share capital
of Company;
"Smarter Asset Management" precautionary techniques for extending
well life that include wellhead compression
management, fluid load deduction and
pumpjack optimization;
"stamp duty" UK stamp duty;
"Stifel" Stifel Nicolaus Europe Limited;
Tennyson Securities a trading name of Shard Capital Partners
LLP;
"Total Cash Costs" operating expense, production taxes,
gathering & transportation expense, gathering
& compression expense and recurring general
& administrative expense;
"Transaction Adjusted Net debt adjusted for the impact of the
Net Debt" Blackbeard Acquisition and Proposed Fundraising;
"UK Companies Act" the UK Companies Act 2006 (as amended);
"United Kingdom" or the UK of Great Britain and Northern
"UK" Ireland;
"United States" or the United States of America, its territories
"US" and possessions, any State of the United
States of America and the District of
Columbia;
"GBP" Great British Pounds Sterling; and
"$" or "US$" United States Dollars.
GLOSSARY OF TECHNICAL TERMS
"decline rate" the annualized rate at which oil and gas
production volumes decline;
"remaining producing the average time period of future production
life" capability of the Company's portfolio
of wells
"barrels" or "bbl" a unit of volume measurement used for
petroleum and its products (for a typical
crude oil 7.3 barrels (equal to 42 US
gallons) = 1 tonne: 6.29 barrels = 1 cubic
metre;
"Bcf" billion cubic feet;
"Bcfe" billion cubic feet of natural gas equivalent;
"boe" barrels of oil equivalent. One barrel
of oil is approximately the energy equivalent
of 5,800 cf of natural gas;
"boepd" barrels of oil equivalent per day;
"btu" British thermal unit, which is the heat
required to raise the temperature of a
one pound mass of water from 58.5 degrees
Fahrenheit to 59.5 degrees Fahrenheit
under specific conditions;
"CO2e" carbon dioxide equivalent;
"gross wells" the total wells in which a working interest
is owned by all parties;
"Mcf" thousand standard cubic feet of natural
gas;
"Mcfe" thousand cubic feet of natural gas equivalent;
"Mcfed" thousand cubic feet of natural gas equivalent
per day;
"Mbbl" thousand barrels of oil;
"Mboepd" Thousand barrels of oil equivalent per
day;
"MMbbl" millions of barrels of oil;
"MMboe" millions of barrels of oil equivalent;
"MMbtu" million btus;
"MMcf" million standard cubic feet of natural
gas;
"MMcfed" million standard cubic feet of natural
gas equivalent per day;
"natural gas" hydrocarbons that at a standard temperature
of sixty degrees Fahrenheit (60 F) and
a standard pressure of one atmosphere
are in a gaseous state, including wet
mineral gas and dry mineral gas, casing
head gas, residual gas remaining after
separation treatment, processing, or extraction
of liquid hydrocarbons;
"net production" the sum of the production volumes from
the net wells;
"net wells" the sum of the fractional working interests
owned by the Group in the gross wells;
"NGL" natural gas liquids;
"NTM" next twelve months
"oil equivalent" international standard for comparing the
thermal energy of different fuels;
"P&A" the plug and abandonment process of a
well for retirement at the end of its
productive life cycle through pumping
of cement into the well to cover and isolate
the zones that produce, have produced,
or contain hydrocarbons;
"PV" or "present value" the present value of a future sum of money
or stream of cash flows given a specific
rate of return e.g. PV 18 means the present
value at a discount rate of eighteen per
cent. (18 per cent.);
"PV10" the present value of a future sum of money
or stream of cash flows given a discount
rate 10 per cent. PV10 is a customary
valuation metric used in the valuation
of future cash flows for oil and gas reserves;
"proved developed proved developed reserves that are expected
producing Reserves" to be recovered from completion intervals
or "PDP" currently open in existing wells and able
to produce to market. Reserves that can
be recovered through wells with existing
equipment and operating methods;
"proved reserves" the estimated quantities of crude oil,
natural gas, and natural gas liquids which
geological and engineering data demonstrate
with reasonable certainty to be recoverable
in future years from known reservoirs
under existing economic and operating
conditions;
"proved undeveloped proved reserves that are expected to be
reserves" or "PUD" recovered from new wells on undrilled
acreage, or from existing wells where
a relatively major expenditure is required
for recompletion;
"recompletion" the completion for production of an existing
well bore in another formation from that
in which the well has been previously
completed;
"recoverable" a description of hydrocarbon reserves
that identifies them as technically or
economically feasible to extract;
"reserves" those quantities of petroleum anticipated
to be commercially recoverable by application
of development projects to known accumulations
from a given date forward under defined
conditions;
"reservoir" a subsurface body of rock having sufficient
porosity and permeability to store and
transmit fluids. A reservoir is a critical
component of a complete petroleum system;
"resources" deposits of naturally occurring hydrocarbons
which, if recoverable, include those volumes
of hydrocarbons either yet to be found
(prospective) or if found the development
of which depends upon a number of factors
(technical, legal and/or commercial) being
resolved (contingent);
"undeveloped acreage" lease acreage on which wells have not
been participated in or completed to a
point that would permit the production
of commercial quantities of oil and gas
regardless of whether such acreage contains
proved reserves;
"working interest" a cost bearing interest which gives the
owner the right to drill, produce, and
conduct oil and gas operations on the
property, as well as a right to a share
of production therefrom;
"West Texas Intermediate" the underlying commodity of the Chicago
Mercantile Exchange's oil futures contracts.
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END
ACQFLFSEESIIFIL
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