TIDMSMWH
RNS Number : 1620Q
WH Smith PLC
17 October 2019
THIS ANNOUNCEMENT (INCLUDING THE APPIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN,
INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH
AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION
OR DISTRIBUTION WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT INCLUDES INSIDE INFORMATION
17 October 2019
WH SMITH PLC
PROPOSED PLACING OF NEW ORDINARY SHARES
WH Smith PLC ("WH Smith" or the "Group") today announces a
proposed placing of new ordinary shares in the Group (the "Placing
Shares") to institutional investors (the "Placing") to raise gross
proceeds of approximately GBP155 million, representing
approximately 7% of WH Smith's existing share capital as at the
closing price on 16 October 2019. The Placing is being conducted
through an accelerated bookbuild which will be launched immediately
following release of this announcement. Barclays Bank PLC
("Barclays") and J.P. Morgan Securities plc, which conducts its UK
investment banking activities as J.P. Morgan Cazenove ("J.P. Morgan
Cazenove" or "JPMC"), are acting as Joint Bookrunners in connection
with the Placing.
As announced separately today, WH Smith has agreed to acquire
Marshall Retail Group ("MRG"), a leading and fast growing US travel
retailer, for $400 million (approximately GBP312 million)(1,2) on a
cash and debt-free basis (the "Transaction").
The net proceeds of the Placing are intended to be used to part
fund the Transaction.
STRATEGIC highlights
-- Compelling opportunity to accelerate the growth of WH Smith's
International Travel business in the $3.2 billion(3) US airport
travel retail market
-- Fast growing and highly successful US travel retailer with
proven business model and unique capabilities across its airport,
resorts and tourist retail channels
-- MRG's significant recent store awards provide strong and
highly visible near-term growth prospects
-- The combination with WH Smith's existing operations,
including InMotion, will strengthen the Group's International
Travel offering
-- The Transaction will broadly double the size of WH Smith's International Travel business
-- Clear integration plan with existing strong MRG management
team incentivised to drive growth
FINANCIAL highlights
-- Implied 2019E EBITDA multiple of 10.0x including synergies; 13.7x excluding synergies(4)
-- 2019E EBITDA of c.$31.5 million(5) , which does not fully
reflect contribution from stores opened year-to-date
-- Annual run-rate cost synergies of c.$11 million expected by
the third full year following Completion from procurement savings
and operational efficiencies
-- 36 awarded stores expected to open between 2020E and 2024E,
of which 24 are expected to be opened next year, providing clear
visibility into future growth(6)
-- MRG expected to deliver a double-digit sales CAGR from 2020E
through to 2024E driven by awarded stores adding more than 75% to
retail square footage within airports
-- Mid-single digit EPS accretion expected in the first full
financial year following Completion, and expected to approach
double digit EPS accretion in the second full financial year
following Completion
-- ROIC expected to exceed WACC by the third full financial year following Completion
FINANCING AND STRUCTURE
-- Proposed acquisition to be financed through a combination of new debt and equity
-- Disciplined financing structure reflecting WH Smith's capital allocation policy
-- Approximately GBP155 million to be raised through an underwritten equity placing
-- Remaining consideration to be financed through a new debt facility
-- Return to below target leverage of 1.25x expected by the end
of WH Smith's first full financial year following Completion
-- The Transaction will require shareholder approval, with the
Circular convening the General Meeting expected to be published by
the end of November 2019
-- Completion expected in the first quarter of the 2020 calendar year
The size of the Transaction means that it constitutes a Class 1
transaction for the purposes of the Listing Rules and accordingly
is conditional on the approval of Shareholders at a General
Meeting.
A circular containing further details of the Transaction, the
Directors' recommendation, the notice of the General Meeting and
the Resolution (the "Circular") is expected to be published by the
end of November 2019.
The completion of the Transaction is subject to a number of
customary conditions, including consent from certain store
landlords (which may be waived by WH Smith) and US HSR regulatory
approval. The Transaction is expected to complete in the first
quarter of the 2020 calendar year.
The Placing is not conditional upon completion of the
Transaction. If one or more conditions to the Transaction are not
satisfied and Completion does not occur, proceeds will be returned
to Shareholders in an efficient manner.
Further information on the Transaction can be found in the
Transaction announcement released by WH Smith today. Capitalised
terms used but not defined in this announcement have the same
meanings as set out in the Group's separate announcement regarding
the Transaction.
Details of the Placing
Barclays and J.P. Morgan Cazenove (together, the "Joint
Bookrunners" and each a "Joint Bookrunner") will commence a
bookbuilding process in respect of the Placing (the "Bookbuild" or
the "Bookbuilding Process"). The book will open with immediate
effect.
The Placing has been fully underwritten by Barclays and J.P.
Morgan Cazenove subject to the conditions and termination rights
set out in the placing agreement between WH Smith and the Joint
Bookrunners (the "Placing and Sponsor's Agreement"). Further
details of the Placing and Sponsor's Agreement can be found in the
terms and conditions contained in the appendix to this announcement
(the "Appendix" (which forms part of this announcement), and
together the announcement, the "Announcement").
The Placing is subject to the terms and conditions set out in
the Appendix. Members of the public are not entitled to participate
in the Placing.
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing issued
ordinary shares of WH Smith. This includes the right to receive all
dividends and other distributions declared or paid in respect of
such ordinary shares after the date of issue of the Placing Shares.
The Placing Shares will be entitled to receive the final dividend
for the financial year ended 30 August 2019.
The number of Placing Shares and the price at which the Placing
Shares are to be placed (the "Placing Price") will be agreed by the
Joint Bookrunners and WH Smith at the close of the Bookbuild. The
timing of the closing of the Bookbuild, pricing and allocations are
at the discretion of the Joint Bookrunners and WH Smith.
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") and to trading on the main
market for listed securities of the London Stock Exchange plc (the
"London Stock Exchange" and together, "Admission"). It is expected
that Admission will take place at or around 8.00 a.m. (London time)
on 21 October 2019 (or such later date as may be agreed between the
Group and the Joint Bookrunners). The Placing is conditional upon,
inter alia, Admission becoming effective. The Placing is also
conditional upon the Placing and Sponsor's Agreement not being
terminated in accordance with its terms.
The Appendix (which forms part of this Announcement) sets out
further information relating to the Bookbuild and the terms and
conditions of the Placing.
For further information please contact:
WH Smith PLC
Investors: Mark Boyle +44 (0) 20 3981 1285
Media: Nicola Hillman +44 (0) 17 9356 3354
Barclays - Joint Bookrunner, Joint Financial Adviser and
Corporate Broker
Mark Astaire, Stuart Jempson
Phil Drake, Ben West +44 (0) 20 7623 2323
J.P. Morgan Cazenove - Joint Bookrunner, Joint Financial Adviser
and Corporate Broker
Edmund Byers, Behzad Arbabzadah,
Nicholas Hall, Ed Digby +44 (0) 20 7742 4000
Brunswick
Fiona Micallef-Eynaud, Alice Gibb +44 (0) 20 7404 5959
About WH Smith
WH Smith is listed on the London Stock Exchange (LSE: SMWH) and
is a constituent of the FTSE 250 Index. The Group is a leading
global retailer in news, books and convenience for the world's
travelling customer. With approximately 1,600 stores in locations
across the globe, WH Smith offers customers a wide range of books,
newspapers & magazines, travel accessories, and food &
drink.
It has two businesses, Travel and High Street. The Travel
business operates from 586 units in UK airports, railway stations,
motorway service areas and hospitals, and 433 units outside of the
UK (including InMotion). Travel currently accounts for
approximately two-thirds of Group trading profits. The High Street
business operates from 576 stores, with an extensive reach across
the UK and a presence on nearly every significant UK high street.
High Street sells a wide range of products, across the following
categories: Stationery (including greetings cards), Books, and News
and Impulse (including newspapers, magazines and
confectionery).
The Group employs around 14,000 people, primarily in the UK.
IMPORTANT NOTICE
Members of the public are not eligible to take part in the
Placing. All offers of the Placing Shares will be made pursuant to
an exemption under Regulation (EU) 2017/1129 (the "Prospectus
Regulation"), from the requirement to produce a prospectus for
offers of the Placing Shares. This Announcement and the terms and
conditions set out in the Appendix to this Announcement are for
information purposes only and are directed only at: (a) persons in
member states of the European Economic Area (the "EEA") other than
the United Kingdom who are qualified investors as defined under the
Prospectus Regulation ("Qualified Investors"); (b) persons in the
United Kingdom who are Qualified Investors and (i) investment
professionals falling within Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (the
"Order") (ii) high net worth companies, unincorporated associations
and other persons falling within Article 49(2)(a) to (d) of the
Order; or (iii) persons to whom it may otherwise by lawfully
communicated (all such persons together being referred to as
"Relevant Persons").
This Announcement and the terms and conditions set out in the
Appendix to this Announcement must not be acted on or relied on by
persons who are not Relevant Persons. Any investment or investment
activity to which this Announcement relates is only available to,
and will be engaged in only with, Relevant Persons. Persons
distributing this Announcement must satisfy themselves that is
lawful to do so. This Announcement is for information only and does
not constitute an offer to sell, or a solicitation of an offer to
buy or otherwise acquire, any securities in any jurisdiction.
Persons needing advice should consult an independent financial
adviser.
The distribution of this Announcement and the offering, placing
and/or issue of the Placing Shares in certain jurisdictions may be
restricted by law. No action has been taken by WH Smith, the Joint
Bookrunners or any of their respective affiliates that would permit
an offer of the Placing Shares or possession or distribution of
this Announcement or any other offering or publicity material
relating to such Placing Shares in any jurisdiction where action
for that purpose is required. Persons into whose possession this
announcement comes are required by WH Smith and the Joint
Bookrunners to inform themselves about and to observe any such
restrictions.
Any failure to comply with such restriction may constitute a
violation of the securities laws of such jurisdictions.
This Announcement or any part of it does not constitute or form
part of any offer to issue or sell, or the solicitation of an offer
to acquire, purchase or subscribe for, any securities in the United
States (including its territories and possessions, any state of the
United States and the District of Columbia (the "United States" or
"US"), Canada, Australia, South Africa, Japan or any other
jurisdiction in which the same would be unlawful. No public
offering of the Placing Shares is being made in any such
jurisdiction.
The Placing Shares have not been and will not be registered
under the US Securities Act of 1933, as amended (the "Securities
Act"), or under the securities laws or with any securities
regulatory authority of any state or other jurisdiction of the
United States, and accordingly the Placing Shares may not be
offered, sold, pledged or transferred, directly or indirectly, in,
into or within the United States except pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act and the securities laws of any
relevant state or jurisdiction of the United States. There is no
intention to register any portion of the offering in the United
States or to conduct a public offering of securities in the United
States.
By participating in the Bookbuilding Process and the Placing,
each person who is invited to and who chooses to participate in the
Placing (each a "Placee") by making an oral and legally binding
offer to acquire Placing Shares will be deemed to have read and
understood this Announcement in its entirety, to be participating,
making an offer and acquiring Placing Shares on the terms and
conditions contained in the Appendix to this Announcement and to be
providing the representations, warranties, indemnities,
acknowledgements and undertakings contained in the Appendix to this
Announcement.
This Announcement may contain "forward-looking statements" with
respect to certain of the Group's plans and its current goals and
expectations relating to its future financial condition,
performance, strategic initiatives, objectives and results.
Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "seek", "may", "could", "outlook" or other words
of similar meaning. By their nature, all forward-looking statements
involve risk and uncertainty because they are based on numerous
assumptions regarding WH Smith's present and future business
strategies, relate to future events and depend on circumstances
which are or may be beyond the control of WH Smith and/or MRG and
which could cause actual results of trends to differ materially
from those made in or suggested by the forward-looking statements
in this Announcement, including, but not limited to, domestic and
global economic business conditions; market-related risks such as
fluctuations in interest rates; the policies and actions of
governmental and regulatory authorities; the effect of competition,
inflation and deflation; the effect of legislative, fiscal, tax and
regulatory developments in the jurisdictions in which WH Smith and
MRG and their respective affiliates operate; the effect of
volatility in the equity, capital and credit markets on
profitability and ability to access capital and credit; a decline
in credit ratings of WH Smith and/or MRG; the effect of operational
and integration risks; an unexpected decline in sales for WH Smith
or MRG; inability to realise anticipated synergies; any limitations
of internal financial reporting controls; and the loss of key
personnel. Any forward-looking statements made in this Announcement
by or on behalf of WH Smith speak only as of the date they are
made. Except as required by applicable law or regulation, WH Smith
expressly disclaims any obligation or undertaking to publish any
updates or revisions to any forward-looking statements contained in
this Announcement to reflect any changes in WH Smith's expectations
with regard thereto or any changes in events, conditions or
circumstances on which any such statement is based.
J.P. Morgan Securities plc, which conducts its UK investment
banking activities as J.P. Morgan Cazenove, and which is authorised
by the Prudential Regulation Authority (the "PRA") and regulated in
the United Kingdom by the Financial Conduct Authority (the "FCA")
and the PRA, is acting for WH Smith in connection with the Placing
and the Transaction and no-one else and will not be responsible to
anyone other than WH Smith for providing the protections afforded
to clients of J.P. Morgan Securities plc nor for providing advice
in relation to the Placing or the Transaction or any other matter
referred to in this Announcement.
Barclays Bank PLC is authorised by the PRA and regulated by FCA
and the PRA, is acting for WH Smith in connection with the Placing
and the Transaction and no-one else and will not be responsible to
anyone other than WH Smith for providing the protections afforded
to clients of Barclays Bank PLC nor for providing advice in
relation to the Placing or the Transaction or any other matter
referred to in this Announcement.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by the Joint Bookrunners or by any of their
respective affiliates or their or their respective affiliates'
agents, directors, officers and employees, respectively, as to, or
in relation to, the accuracy or completeness of this Announcement
or any other written or oral information made available to or
publicly available to any interested party or its advisers, and any
liability therefor is expressly disclaimed.
This Announcement does not constitute a recommendation
concerning any investor's options with respect to the Placing. The
price of shares and any income expected from them may go down as
well as up and investors may not get back the full amount invested
upon disposal of the shares. Past performance is no guide to future
performance. The contents of this Announcement are not to be
construed as legal, business, financial or tax advice. Each
investor or prospective investor should consult his, her or its own
legal adviser, business adviser, financial adviser or tax adviser
for legal, financial, business or tax advice.
The Placing Shares to be issued or sold pursuant to the Placing
will not be admitted to trading on any stock exchange other than
the London Stock Exchange.
Neither the content of WH Smith's website nor any website
accessible by hyperlinks on WH Smith's website is incorporated in,
or forms part of, this Announcement.
Information to Distributors
Solely for the purposes of the product governance requirements
contained within: (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 Bookrunners will only procure investors who
meet the criteria of professional clients and eligible
counterparties.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take
any other action whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
A circular containing further details of the Transaction, the
Directors' recommendation, the notice of the General Meeting and
the Resolution is expected to be sent to WH Smith shareholders by
the end of November 2019. Subject to satisfaction of the
Conditions, Completion is expected to occur in the first quarter of
calendar year 2020.
APPIX A - TERMS AND CONDITIONS
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES
ONLY
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. ALL OFFERS OF THE PLACING SHARES WILL BE MADE PURSUANT TO
AN EXEMPTION UNDER REGULATION (EU) 2017/1129 (THE "PROSPECTUS
REGULATION"), FROM THE REQUIREMENT TO PRODUCE A PROSPECTUS FOR
OFFERS OF THE PLACING SHARES. THIS ANNOUCEMENT AND THE TERMS AND
CONDITIONS SET OUT IN THIS ANNOUNCEMENT ARE FOR INFORMATION
PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER
STATES OF THE EUROPEAN ECONOMIC AREA (THE "EEA") OTHER THAN THE
UNITED KINGDOM WHO ARE QUALIFIED INVESTORS AS DEFINED IN THE
PROSPECTUS REGULATION ("QUALIFIED INVESTORS"); (B) PERSONS IN THE
UNITED KINGDOM WHO ARE QUALIFIED INVESTORS AND (I) INVESTMENT
PROFESSIONALS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL
SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005,
(THE "ORDER"); OR (II) HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS AND OTHER PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO
(D) OF THE ORDER; OR (III) PERSONS TO WHOM IT MAY OTHERWISE
LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED
TO AS "RELEVANT PERSONS").
THIS ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
INTO THE UNITED STATES, AUSTRALIA, ANY PROVINCE OR TERRITORY OF
CANADA OTHER THAN THE PROVINCES OF ONTARIO, QUEBEC, ALBERTA AND
BRITISH COLUMBIA (AND IN THOSE PROVINCES ONLY TO PURCHASERS THAT
ARE NOT INDIVIDUALS AND THAT QUALIFY BOTH AS AN "ACCREDITED
INVESTOR" AND A "PERMITTED CLIENT" UNDER APPLICABLE CANADIAN
SECURITIES LAWS), JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION IN
WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE
UNLAWFUL.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO THE
LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF A PURCHASE OF PLACING
SHARES.
This Announcement is for information purposes only and does not
constitute an offer to sell or issue or the solicitation of an
offer to buy or subscribe for any new ordinary shares ("Placing
Shares") in the capital of WH Smith ("WH Smith" or the "Group") in
any jurisdiction in which any such offer or solicitation would be
unlawful.
All offers of the Placing Shares will be made pursuant to an
exemption under the 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 referred to in this Announcement have not
been and will not be registered under the U.S. Securities Act of
1933 (the "Securities Act") or under the securities laws of any
state or other jurisdiction of the United States, and may not be
offered, sold or transferred in, into or within the United States
except pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act and
the securities laws of any relevant state or jurisdiction of the
United States.
The distribution of this Announcement, the placing of the
Placing Shares (the "Placing") and/or issue of the Placing Shares
in certain jurisdictions may be restricted by law. No action has
been taken by WH Smith, Barclays Bank PLC ("Barclays"), or J.P.
Morgan Securities plc (which conducts its UK investment banking
business as J.P. Morgan Cazenove) ("JPMC") (Barclays and, together
with JPMC, the "Joint Bookrunners" and each a "Joint Bookrunner")
or any of their respective affiliates that would permit an offer of
the Placing Shares or possession or distribution of this
Announcement or any other offering or publicity material relating
to such Placing Shares in any jurisdiction where action for that
purpose is required. Persons into whose possession this
Announcement comes are required by WH Smith and the Joint
Bookrunners to inform themselves about and to observe any such
restrictions.
This Announcement should be read in its entirety. In particular,
you should read and understand the information provided in the
"Important Notices" section of this Announcement.
Persons who are invited to and who choose to participate in the
Placing (and any person acting on such person's behalf) by making
an oral or written offer to subscribe for Placing Shares, including
any individuals, funds or others on whose behalf a commitment to
subscribe for Placing Shares is given (the "Placees") will be
deemed to have read and understood this Announcement in its
entirety, to be participating, making an offer and subscribing for
Placing Shares on the terms and conditions contained in this
Appendix and to be providing the representations, warranties,
indemnities, acknowledgements and undertakings contained in this
Appendix. In particular, each such Placee represents, warrants,
undertakes, agrees and acknowledges (amongst other things),
that:
1 it is a Relevant Person 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; and
2 in the case of a Relevant Person in a member state of the EEA
who subscribes for any Placing Shares pursuant to the Placing:
(a) it is a Qualified Investor; and
(b) in the case of any Placing Shares subscribed for by it as a
financial intermediary, as that term is used in Article 5(1) of the
Prospectus Regulation,
(i) the Placing Shares subscribed for by it in the Placing have
not been subscribed for on behalf of, nor have they been subscribed
for with a view to their offer or resale to, persons in any member
state of the EEA other than Qualified Investors or in circumstances
in which the prior consent of the Joint Bookrunners has been given
to the offer or resale; or
(ii) where Placing Shares have been subscribed for by it on
behalf of persons in any member state of the EEA other than
Qualified Investors, the offer of those Placing Shares to it is not
treated under the Prospectus Regulation as having been made to such
persons; and
3 it is subscribing for the Placing Shares for its own account
or is subscribing for the Placing Shares for an account with
respect to which it exercises sole investment discretion and has
the authority to make and does make the representations,
warranties, indemnities, acknowledgements and agreements contained
in this Announcement; and
4 it understands (or, if acting for the account of another
person, such person understands) the resale and transfer
restrictions set out in this Appendix; and
5 except as otherwise permitted by WH Smith and subject to any
available exemptions from applicable securities laws, it (and any
account referred to in paragraph 3 above) is either (i) outside the
United States subscribing for the Placing Shares in an offshore
transaction as defined in and in accordance with Regulation S under
the Securities Act or (ii) a "qualified institutional buyer" as
defined in Rule 144A under the Securities Act ("Rule 144A").
No prospectus
No prospectus or other offering document has been or will be
submitted to be approved by the Financial Conduct Authority (the
"FCA") in relation to the Placing and Placees' commitments will be
made solely on the basis of the information contained in this
Announcement (including this Appendix), the announcement of the
pricing of the Placing through a Regulatory Information Service
(the "Placing Results Announcement") and any information publicly
announced through a Regulatory Information Service (as defined in
the listing rules of the FCA (the "Listing Rules")) by or on behalf
of WH Smith on or prior to the date of this Announcement or
otherwise published on WH Smith's website in connection with this
Placing (the "Publicly Available Information") and subject to any
further terms set forth in the contract note or trade confirmation
sent to individual Placees. Each Placee, by participating in the
Placing, agrees that it has neither received nor relied on any
information, representation, warranty or statement made by or on
behalf of the Joint Bookrunners or WH Smith other than the Publicly
Available Information and none of the Joint Bookrunners, WH Smith
nor any person acting on such person's behalf nor any of their
affiliates has or shall have any liability for any Placee's
decision to participate in the Placing based on any other
information, representation, warranty or statement. Each Placee
acknowledges and agrees that it has relied on its own investigation
of the business, financial or other position of the Group in
accepting a participation in the Placing. Nothing in this paragraph
shall exclude the liability of any person for fraudulent
misrepresentation.
Details of the Placing Agreement and the Placing Shares
Each of the Joint Bookrunners has entered into a placing and
sponsor's agreement (the "Placing Agreement") with WH Smith under
which it has severally undertaken, on the terms and subject to the
conditions set out in the Placing Agreement, to use reasonable
endeavours to procure Placees for the Placing Shares. In accordance
with the terms of the Placing Agreement, to the extent any Placee
fails to take up its allocation of Placing Shares, the Joint
Bookrunners have severally agreed to take up such shares in the
Agreed Proportion (as defined in the Placing Agreement) and WH
Smith agrees to allot and issue such shares to the Joint
Bookrunners accordingly, in each case on the terms set out in the
Placing Agreement.
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing ordinary
shares in the capital of WH Smith ("Ordinary Shares"), including
the right to receive all dividends and other distributions
declared, made or paid in respect of such Ordinary Shares after the
date of issue of the Placing Shares, including the final dividend
for the year ended 30 August 2019.
As part of the Placing, WH Smith has agreed that it will not
issue or sell any Ordinary Shares for a period of 90 days after
Admission (as defined below) without the prior written consent of
the Joint Bookrunners. This agreement is subject to certain
customary exceptions.
Application for admission to listing and trading
Applications will be made to the FCA for admission of the
Placing Shares to listing on the premium listing segment of the
Official List and to London Stock Exchange plc ("London Stock
Exchange") for admission of the Placing Shares to trading on its
main market for listed securities (together "Admission").
It is expected that Admission will take place on or before 8.00
a.m. (London time) on 21 October 2019 and that dealings in the
Placing Shares on the London Stock Exchange's main market for
listed securities will commence at the same time.
Bookbuilding Process
The Joint Bookrunners will today commence the bookbuilding
process in respect of the Placing (the "Bookbuilding Process") to
determine demand for participation in the Placing by Placees. This
Appendix gives details of the terms and conditions of, and the
mechanics of participation in, the Placing. No commissions will be
paid to Placees or by Placees in respect of any Placing Shares.
The Joint Bookrunners and WH Smith shall be entitled to effect
the Placing by such alternative method to the Bookbuilding Process
as they may, in their sole discretion, determine.
Principal terms of the Bookbuilding Process and Placing
1 Barclays and JPMC are acting as Joint Bookrunners to the
Placing, as agents of WH Smith.
2 Participation in the Placing will only be available to persons
who may lawfully be, and are, invited by the Joint Bookrunners to
participate. The Joint Bookrunners and their affiliates are
entitled to enter bids in the Bookbuilding Process.
3 The Bookbuilding Process will establish a single price per
Placing Share payable to the Joint Bookrunners by all Placees whose
bids are successful (the "Placing Price"). The Placing Price and
the aggregate proceeds to be raised through the Placing will be
agreed between the Joint Bookrunners and WH Smith following
completion of the Bookbuilding Process and any discount to the
market price of the Ordinary Shares will be determined in
accordance with the Listing Rules.
4 To bid in the Bookbuilding Process, Placees should communicate
their bid by telephone to their usual sales contact at Barclays or
JPMC. Each bid should state the number of Placing Shares that a
prospective Placee wishes to subscribe for at either the Placing
Price which is ultimately established by WH Smith and the Joint
Bookrunners or at prices up to a price limit specified in its bid.
Bids may be scaled down by the Joint Bookrunners on the basis
referred to in paragraph 9 below. Each of the Joint Bookrunners is
arranging the Placing severally, and not jointly, or jointly and
severally, as agent of WH Smith.
5 The Bookbuilding Process is expected to close no later than
4.00 p.m. (London time) on 17 October 2019 but may be closed
earlier or later at the discretion of the Joint Bookrunners. The
Joint Bookrunners may, in agreement with WH Smith, accept bids that
are received after the Bookbuilding Process has closed. WH Smith
reserves the right to reduce the amount to be raised pursuant to
the Placing in its discretion. The total number of shares to be
issued pursuant to the Placing shall not exceed the number of
shares permitted to be issued pursuant to the allotment and
disapplication of pre-emption authorities that shareholders granted
to WH Smith at its annual meeting on 23 January 2019.
6 Each Placee's allocation will be agreed between the Joint
Bookrunners and will be confirmed orally by the relevant Joint
Bookrunner as soon as practicable following the close of the
Bookbuilding Process. The relevant Joint Bookrunner's oral
confirmation of an allocation will give rise to a legally binding
commitment by the Placee concerned, in favour of the relevant Joint
Bookrunner and WH Smith, under which it agrees to subscribe for the
number of Placing Shares allocated to it on the terms and subject
to the conditions set out in this Appendix and WH Smith's articles
of association.
7 WH Smith will release the Placing Results Announcement
following the close of the Bookbuilding Process, detailing the
aggregate number of the Placing Shares to be issued and the Placing
Price at which such shares have been placed.
8 Each Placee's allocation and commitment will be evidenced by a
contract note or trade confirmation issued to such Placee by one of
the Joint Bookrunners. The terms of this Appendix will be deemed
incorporated therein.
9 The Joint Bookrunners may choose to accept bids, either in
whole or in part, on the basis of allocations agreed with WH Smith
and may scale down any bids for this purpose on such basis as they
may determine or be directed. The Joint Bookrunners may also,
notwithstanding paragraphs 5 to 7 above, (a) allocate Placing
Shares after the time of any initial allocation to any person
submitting a bid after that time and (b) allocate Placing Shares
after the Bookbuilding Process has closed to any person submitting
a bid after that time.
10 A bid in the Bookbuilding Process will be made on the terms
and subject to the conditions in this Appendix and will be legally
binding on the Placee on behalf of which it is made and except with
the relevant Joint Bookrunner's 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 relevant Joint Bookrunner, to pay
to it (or as it may direct) in cleared funds an amount equal to the
product of the Placing Price and the number of Placing Shares such
Placee has agreed to subscribe for and WH Smith has agreed to allot
and issue to that Placee.
11 Except as required by law or regulation, no press release or
other announcement will be made by the Joint Bookrunners or WH
Smith using the name of any Placee (or its agent), in its capacity
as Placee (or agent), other than with such Placee's prior written
consent.
12 Irrespective of the time at which a Placee's allocation(s)
pursuant to the Placing is/are confirmed, settlement for all
Placing Shares to be subscribed for pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under 'Registration and Settlement'.
13 All obligations under the Bookbuilding Process and Placing
will be subject to fulfilment of the conditions referred to below
under 'Conditions of the Placing' and to the Placing not being
terminated on the basis referred to below under 'Termination of the
Placing'.
14 By participating in the Bookbuilding Process each Placee will
agree that its rights and obligations in respect of the Placing
will terminate only in the circumstances described below and will
not be capable of rescission or termination by the Placee.
15 To the fullest extent permissible by law, neither of the
Joint Bookrunners nor any of their affiliates nor any of their or
their respective affiliates' agents, directors, officers or
employees, respectively, shall have any liability to Placees (or to
any other person whether acting on behalf of a Placee or
otherwise). In particular, none of the Joint Bookrunners nor any of
their affiliates nor any of its or their agents, directors,
officers or employees shall have any liability (including, to the
extent permissible by law, any fiduciary duties) in respect of the
Joint Bookrunners' conduct of the Bookbuilding Process or of such
alternative method of effecting the Placing as the Joint
Bookrunners and WH Smith may agree.
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing, they
will be sent a contract note or trade confirmation which will
confirm the number of Placing Shares allocated to them, the Placing
Price and the aggregate amount owed by them to the relevant Joint
Bookrunner. Each Placee will be deemed to agree that it will do all
things necessary to ensure that delivery and payment is completed
in accordance with either the standing CREST or certificated
settlement instructions which they have in place with the relevant
Joint Bookrunner or otherwise as such Joint Bookrunner may
direct.
Settlement of transactions in the Placing Shares (ISIN:
GB00B2PDGW16 ) following Admission will take place within the CREST
system. Settlement through CREST will be on a T+2 basis unless
otherwise notified by the Joint Bookrunners and is expected to
occur on 21 October 2019. Settlement will be on a delivery versus
payment basis. However, in the event of any difficulties or delays
in the admission of the Placing Shares to CREST or the use of CREST
in relation to the Placing, WH Smith and the Joint Bookrunners may
agree that the Placing Shares should be issued in certificated
form. The Joint Bookrunners reserve the right to require settlement
for the Placing Shares, and to deliver the Placing Shares to
Placees, by such other means as they deem necessary if delivery or
settlement to Placees is not practicable within the CREST system or
would not be consistent with regulatory requirements in a Placee's
jurisdiction.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above, in respect of either CREST or certificated deliveries, at
the rate of two percentage points above prevailing LIBOR as
determined by the Joint Bookrunners.
If Placees do not comply with their obligations the relevant
Joint Bookrunner may sell any or all of their Placing Shares on
their behalf and retain from the proceeds, for its own account and
benefit, an amount equal to the Placing Price of each share sold
plus any interest due. Placees will, however, remain liable for any
shortfall below the Placing Price and for any stamp duty or stamp
duty reserve tax (together with any interest or penalties) which
may arise upon the sale of their Placing Shares on their
behalf.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional contract note or 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. Placees will not be entitled to receive any fee
or commission in connection with the Placing.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming
unconditional and not having been terminated in accordance with its
terms.
The obligations of the Joint Bookrunners under the Placing
Agreement are, and the Placing is, conditional on, inter alia:
(a) WH Smith having complied with its obligations under the
Placing Agreement or under the terms or conditions of the Placing
which fall to be performed on or prior to Admission save where, in
the opinion of the Joint Bookrunners, acting together and in good
faith, such non-compliance is not (singly or in the aggregate)
material in the context of the Placing or Admission;
(b) the representations and warranties on the part of WH Smith
contained in the Placing Agreement are true and accurate and not
misleading as at the date of the Placing Agreement and as at
Admission save where, in the opinion of the Joint Bookrunners,
acting together and in good faith, such non-compliance is not
(singly or in the aggregate) material in the context of the Placing
or Admission;
(c) the Share Purchase Agreement (as that term is defined in the
Placing Agreement) remaining in full force and effect and not
having been amended in any material respect or terminated
(including no notice having been given in respect of its
termination), and no condition that is not capable of waiver by WH
Smith in the Share Purchase Agreement having become incapable of
satisfaction, in each case prior to Admission;
(d) the Terms of Subscription (as such term is defined in the
Placing Agreement having been duly executed no later than 6.00 p.m.
(London time) on the date of the Placing Agreement;
(e) the publication of the Placing Results Announcement through
a Regulatory Information Service by no later than 8.00 a.m. (London
time) on the first business day following the date of the Placing
Agreement;
(f) WH Smith allotting, subject only to Admission, the Placing
Shares in accordance with the Placing Agreement;
(g) the delivery by WH Smith to the Joint Bookrunners
immediately prior to Admission of a certificate signed for and on
behalf of WH Smith by a Director on behalf thereof confirming,
inter alia, that the warranties given by WH Smith in the Placing
Agreement remain true and accurate; and
(h) Admission taking place not later than 8.00 a.m. (London time) on 21 October 2019,
(all conditions to the obligations of the Joint Bookrunners
included in the Placing Agreement being together, the
"conditions").
If any of the conditions set out in the Placing Agreement is not
fulfilled or, where permitted, waived to the extent permitted by
law or regulations in accordance with the Placing Agreement within
the stated time periods (or such later time and/or date as WH Smith
and the Joint Bookrunners may agree, or the Placing Agreement is
terminated in accordance with its terms (as to which, see
'Termination of the Placing' below)), the Placing will lapse and
the Placee's rights and obligations shall cease and terminate at
such time and each Placee agrees that no claim can be made by or on
behalf of the Placee (or any person on whose behalf the Placee is
acting) in respect thereof.
By participating in the Bookbuilding Process, each Placee agrees
that its rights and obligations cease and terminate only in the
circumstances described above and under 'Termination of the
Placing' below and will not be capable of rescission or termination
by it.
The Joint Bookrunners (acting jointly) may, at their absolute
discretion and upon such terms as they think appropriate, waive
fulfilment of all or any of the conditions in the Placing Agreement
in whole or in part (to the extent permitted by law or regulation)
or extend the time provided for fulfilment of any such conditions
in respect of all or any part of the performance thereof. The
condition in the Placing Agreement relating to Admission may not be
waived. Any such extension or waiver will not affect Placees'
commitments as set out in this Appendix.
Neither the Joint Bookrunners nor any of their respective
affiliates nor any of their or their respective affiliates' agents,
directors, officers or employees, respectively, nor WH Smith shall
have any liability to any Placee (or to any other person whether
acting on behalf of a Placee or otherwise) in respect of any
decision any of them may make as to whether or not to waive or to
extend the time and/or date for the satisfaction of any condition
to the Placing nor for any decision any of them may make as to the
satisfaction of any condition or in respect of the Placing
generally and by participating in the Placing each Placee agrees
that any such decision is within the absolute discretion of the
Joint Bookrunners and WH Smith.
Termination of the Placing
The Joint Bookrunners (acting jointly) may, in their absolute
discretion terminate the Placing Agreement at any time up to and
including Admission in certain circumstances, including (among
others) a breach of the warranties given to the Joint Bookrunners
which the Joint Bookrunners acting in good faith consider to be
material in the context of the Placing or Admission; the occurrence
of a Material Adverse Change (as that term is defined in the
Placing Agreement), in the good faith opinion of a Joint
Bookrunner; or on the occurrence of a force majeure event. Notice
of termination may be communicated by a Joint Bookrunner as soon as
practicable to any director of WH Smith orally or by email or
otherwise and announced to a Regulatory Information Service.
If the Placing Agreement is terminated in accordance with its
terms, the rights and obligations of each Placee in respect of the
Placing as described in this Announcement shall cease and terminate
at such time and no claim may be made by any Placee in respect
thereof.
By participating in the Bookbuilding Process, each Placee agrees
with WH Smith and the Joint Bookrunners that the exercise by WH
Smith or the Joint Bookrunners of any right of termination or any
other right or other discretion under the Placing Agreement shall
be within the absolute discretion of WH Smith or the Joint
Bookrunners (as the case may be) and that neither WH Smith nor the
Joint Bookrunners need make any reference to such Placee and that
none of WH Smith, the Joint Bookrunners, their respective
affiliates or their or their respective affiliates' agents,
directors, officers or employees, respectively, shall have any
liability to such Placee (or to any other person whether acting on
behalf of a Placee or otherwise) whatsoever in connection with any
such exercise.
By participating in the Placing, each Placee agrees that its
rights and obligations terminate only in the circumstances
described above and under 'Conditions of the Placing' above and
will not be capable of rescission or termination by it after oral
confirmation by the Joint Bookrunners following the close of the
Bookbuilding Process.
Representations, warranties and further terms
By submitting a bid in the Bookbuilding Process, each
prospective Placee (and any person acting on such Placee's behalf)
represents, warrants, acknowledges and agrees (for itself and for
any such prospective Placee) that:
1 it has read and understood this Announcement in its entirety
and that its subscription for the Placing Shares is subject to and
based upon all the terms, conditions, representations, warranties,
indemnities, acknowledgements, agreements and undertakings and
other information contained in this Appendix and that it has not
relied on, and will not rely on, any information given or any
representations, warranties or statements made at any time by any
person in connection with Admission, the Placing, WH Smith, the
Placing Shares or otherwise, other than the information contained
in this Announcement and the Publicly Available Information;
2 it has not received a prospectus or other offering document in
connection with the Placing and acknowledges that no prospectus or
other offering document has been or will be prepared in connection
with the Placing;
3 WH Smith's Ordinary Shares are listed on the premium listing
segment of the Official List, and that WH Smith is therefore
required to publish certain business and financial information in
accordance with the rules and practices of the FCA, which includes
a description of the nature of WH Smith's business and WH Smith's
most recent balance sheet and profit and loss account and that it
is able to obtain or access such information without undue
difficulty, and is able to obtain access to such information or
comparable information concerning any other publicly traded
company, without undue difficulty;
4 neither the Joint Bookrunners nor WH Smith nor any of their
respective affiliates, or their or their respective affiliates'
agents, directors, officers or employees, respectively, nor any
person acting on behalf of any of them has provided, and will not
provide, it with any material regarding the Placing Shares or WH
Smith or any other person other than the information in this
Announcement or any other Publicly Available Information, such
information being all that it deems necessary to make an investment
decision in respect of the Placing Shares; nor has it requested the
Joint Bookrunners, WH Smith, any of their affiliates, agents,
directors, officers or employees or any person acting on behalf of
any of them to provide it with any such information;
5 neither the Joint Bookrunners nor any person acting on behalf
of them nor any of their respective affiliates, or their or their
respective affiliates, agents, directors, officers or employees,
respectively, has or shall have any liability for this
Announcement, or any other Publicly Available Information, or any
representation relating to the Group, provided that nothing in this
paragraph excludes the liability of any person for fraudulent
misrepresentation made by that person;
6 the Placing is not conditional upon completion of the
Transaction and that although WH Smith anticipates using the
proceeds raised through the Placing to satisfy part of the cash
consideration payable and the costs associated with the
Transaction, completion of the Transaction is dependent on certain
conditions being satisfied and that neither WH Smith nor the Joint
Bookrunners warrant or represent that the Transaction will take
place;
7 the content of this Announcement and the Publicly Available
Information has been prepared by and is exclusively the
responsibility of WH Smith and that neither of the Joint
Bookrunners, any of their affiliates or any persons acting on their
behalf is responsible for or has or shall have any liability for
any information or representation, warranty or statement relating
to the Group contained in this Announcement, or any other Publicly
Available Information, nor will they be liable for any Placee's
decision to participate in the Placing based on any information,
representation, warranty or statement contained in this
Announcement, any other Publicly Available Information or
otherwise. Nothing in this Appendix shall exclude any liability of
any person for fraudulent misrepresentation;
8 it and/or each person on whose behalf it is participating is
not, and at the time the Placing Shares are subscribed for will not
be, a resident of Australia, South Africa, Japan or any province or
territory of Canada other than the Provinces of Ontario, Quebec,
Alberta and British Columbia (and, if in those provinces, it and/or
each person on whose behalf it is participating is both an
"accredited investor" and a "permitted client" under applicable
Canadian securities laws);
9 the Placing Shares are being offered and sold on behalf of WH
Smith in offshore transactions (as defined in Regulation S under
the Securities Act) and to certain qualified institutional buyers
("QIBs") (as defined in Rule 144A) in reliance upon Rule 144A or
another exemption from, or transaction not subject to, the
registration requirements under the Securities Act. It and the
prospective beneficial owner of the Placing Shares is, and at the
time the Placing Shares are subscribed for will be either: (i)
outside the United States and subscribing for the Placing Shares in
an offshore transaction as defined in, and in accordance with,
Regulation S under the Securities Act or (ii) a QIB which has
(where required by the relevant Joint Bookrunner) agreed to be
bound to the terms of a US investor letter in the form provided to
it by one of the Joint Bookrunners or its affiliates. In addition,
it has such knowledge and experience in financial and business
matters to be capable of evaluating the merits and the risks of an
investment in the Placing Shares, will not look to the Joint
Bookrunners for all or part of any such loss it may suffer, is able
to bear the economic risk of an investment in the Placing Shares
and is able to sustain a complete loss of the investment in the
Placing Shares and, with respect to (ii) above, it is subscribing
for the Placing Shares for its own account or for one or more
accounts as to each of which it exercises sole investment
discretion and each of which is a QIB, it is subscribing for the
Placing Shares for investment purposes only and not with a view to
any distribution or for resale in connection with the distribution
thereof in whole or in part, in the United States and it has full
power to make the acknowledgements, representations and agreements
herein on behalf of each such account.
10 The Placing Shares have not been and will not be registered
or qualified for offer and sale nor will a prospectus be cleared in
respect of any of the Placing Shares under the securities laws or
legislation of the United States, Australia, Canada, Japan or South
Africa and, subject to certain exceptions, may not be offered,
sold, resold, delivered, pledged or transferred, directly or
indirectly, within those jurisdictions.
11 (i) the only information on which it is entitled to rely and
on which it has relied in committing to subscribe for the Placing
Shares is contained in this Announcement and the Publicly Available
Information, such information being all that it deems necessary to
make an investment decision in respect of the Placing Shares and it
has made its own assessment of WH Smith, the Placing Shares and the
terms of the Placing based on Publicly Available Information; (ii)
the Joint Bookrunners and WH Smith (or any of their respective
affiliates) have not made any representation to it, express or
implied, with respect to the Group, the Placing or the Placing
Shares or the accuracy, completeness or adequacy of the Publicly
Available Information; (iii) it has conducted its own investigation
of the Group, the Placing and the Placing Shares, satisfied itself
that the information is still current and relied on that
investigation for the purposes of its decision to participate in
the Placing; and (iv) it has not relied on any investigation that
the Joint Bookrunners or any person acting on their behalf may have
conducted with respect to the Group, the Placing or the Placing
Shares;
12 the Placing Shares have not been registered or otherwise
qualified, and will not be registered or otherwise qualified, for
offer and sale nor will a prospectus be cleared or approved in
respect of any of the Placing Shares under the securities laws of
the United States, or any state or other jurisdiction of the United
States, nor approved or disapproved by the US Securities and
Exchange Commission, any state securities commission or other
regulatory authority in the United States, nor have any of the
foregoing authorities passed upon or endorsed the merits of the
Placing or the accuracy or adequacy of this Announcement. The
Placing Shares have not been registered or otherwise qualified for
offer and sale nor will a prospectus be cleared or approved in
respect of the Placing Shares under the securities laws of
Australia, Canada, South Africa or Japan and, subject to certain
exceptions, may not be offered, sold, taken up, renounced or
delivered or transferred, directly or indirectly, within the United
States, Australia, Canada, South Africa or Japan or in any country
or jurisdiction where any action for that purpose is required;
13 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, so long as the Placing Shares are
"restricted securities", it will not deposit the Placing Shares
into any unrestricted depositary receipt facility maintained by any
depositary bank in respect of WH Smith's securities. It will not
reoffer, sell, pledge or otherwise transfer the Placing Shares
except: (i) in an offshore transaction in accordance with
Regulation S under the Securities Act; (ii) in the United States to
QIBs pursuant to Rule 144A; (iii) pursuant to Rule 144 under the
Securities Act (if available) or another exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act, in each case in compliance with all applicable
securities laws of the United States or any State or other
jurisdiction of the United States or (iv) pursuant to an effective
registration statement under the Securities Act and that, in each
such case, such offer, sale, pledge or transfer will be made in
accordance with any applicable securities laws of any state of the
United States;
14 it and/or each person on whose behalf it is participating:
(a) is entitled to subscribe for Placing Shares pursuant to the
Placing under the laws and regulations of all relevant
jurisdictions;
(b) has fully observed such laws and regulations;
(c) has capacity and authority and is entitled to enter into and
perform its obligations as a subscriber of Placing Shares and will
honour such obligations; and
(d) has obtained all necessary consents and authorities
(including, without limitation, in the case of a person acting on
behalf of a Placee, all necessary consents and authorities to agree
to the terms set out or referred to in this Appendix) to enable it
to enter into the transactions contemplated hereby and to perform
its obligations in relation thereto;
15 it will not distribute, forward, transfer or otherwise
transmit this Announcement or any part of it, or any other
presentational or other materials concerning the Placing in or into
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;
16 neither of the Joint Bookrunners, nor their respective
affiliates, nor any person acting on behalf of any of them is
making any recommendations to it, 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 either of the
Joint Bookrunners and that the Joint Bookrunners have no duties or
responsibilities to it for providing the protections afforded to
their clients or customers or for providing advice in relation to
the Placing nor in respect of any representations, warranties,
undertakings or indemnities contained in the Placing Agreement nor
for the exercise or performance of any of its rights and
obligations thereunder including any rights to waive or vary any
conditions or exercise any termination right;
17 it will make payment to the Joint Bookrunners (as the Joint
Bookrunners may direct) for the Placing Shares allocated to it in
accordance with the terms and conditions of this Announcement on
the due times and dates set out in this Announcement, failing which
the relevant Placing Shares may be placed with others on such terms
as the Joint Bookrunners determine in their absolute discretion
without liability to the Placee and it will remain liable for any
shortfall below the net proceeds of such sale and the placing
proceeds of such Placing Shares and may be required to bear any
stamp duty or stamp duty reserve tax (together with any interest or
penalties due pursuant to the terms set out or referred to in this
Announcement) which may arise upon the sale of such Placee's
Placing Shares on its behalf;
18 its allocation (if any) of Placing Shares will represent a
maximum number of Placing Shares which it will be entitled, and
required, to subscribe for, and that it may be called upon to
subscribe for a lower number of Placing Shares (if any), but in no
event in aggregate more than the aforementioned maximum;
19 no action has been or will be taken by any of WH Smith, the
Joint Bookrunners or any person acting on behalf of WH Smith or the
Joint Bookrunners that would, or is intended to, permit a public
offer of the Placing Shares in the United States or in any country
or jurisdiction where any such action for that purpose is
required;
20 the person who it specifies for registration as holder of the
Placing Shares will be (i) the Placee; or (ii) a nominee of the
Placee, as the case may be. The Joint Bookrunners and WH Smith will
not be responsible for any liability to stamp duty or stamp duty
reserve tax resulting from a failure to observe this requirement.
It agrees to subscribe for Placing Shares pursuant to the Placing
on the basis that the Placing Shares will be allotted to a CREST
stock account of the Joint Bookrunners (or either of them) who will
hold them as nominee directly or indirectly on behalf of the Placee
until settlement in accordance with its standing settlement
instructions with it;
21 the allocation, allotment, issue and delivery to it, or the
person specified by it for registration as holder, of Placing
Shares will not give rise to a stamp duty or stamp duty reserve tax
liability under (or at a rate determined under) any of sections 67,
70, 93 or 96 of the Finance Act 1986 (depository receipts and
clearance services) and that it is not participating in the Placing
as nominee or agent for any person or persons to whom the
allocation, allotment, issue or delivery of Placing Shares would
give rise to such a liability;
22 it and any person acting on its behalf falls within Article
19(5) and/or 49(2) of the Order, as amended, and undertakes that it
will subscribe for, hold, manage and (if applicable) dispose of any
Placing Shares that are allocated to it for the purposes of its
business only;
23 it has not offered or sold and will not offer or sell any
Placing Shares to persons in the United Kingdom prior to Admission
except to persons whose ordinary activities involve them in
subscribing for, holding, managing or disposing of investments (as
principal or agent) for the purposes of their business or otherwise
in circumstances which have not resulted and which will not result
in an offer to the public in the United Kingdom within the meaning
of section 85(1) of FSMA;
24 if within the EEA, it is a Qualified Investor as defined in
section 86(7) of FSMA, being a person falling within Article 2(e)
of the Prospectus Regulation;
25 it has only communicated or caused to be communicated and it
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of FSMA) relating to Placing Shares in circumstances in
which section 21(1) of FSMA does not require approval of the
communication by an authorised person;
26 it has complied and it will comply with all applicable laws
with respect to anything done by it or on its behalf in relation to
the Placing Shares (including all relevant provisions of FSMA and
the Financial Services Act 2012 in respect of anything done in,
from or otherwise involving the United Kingdom);
27 if it is a financial intermediary, as that term is used in
Article 5(1) of the Prospectus Regulation (including any relevant
implementing measure in any member state), 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 in
circumstances in which the express prior written consent of the
Joint Bookrunners has been given to the offer or resale.
28 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
persons whose ordinary activities involve them in subscribing for,
holding, managing or disposing of investments (as principal or
agent) for the purpose of their business or otherwise in
circumstances which have not resulted and which will not result in
an offer to the public in any member state of the EEA;
29 if it has received any inside information (as defined in the
market abuse regulation (EU) No. 596/2014) about WH Smith in
advance of the Placing, it has not: (i) dealt in the securities of
WH Smith; (ii) encouraged or required another person to deal in the
securities of WH Smith; or (iii) disclosed such information to any
person, prior to the information being made publicly available;
30 neither the Joint Bookrunners, WH Smith nor any of their
respective affiliates, or their or their respective affiliates'
agents, directors, officers or employees, respectively, nor any
person acting on behalf of such persons is making any
recommendation to it, advising it regarding the suitability of any
transaction it may enter into in connection with the Placing nor
providing advice in relation to the Placing nor in respect of any
representation, warranty, acknowledgement, agreement, undertaking
or indemnity contained in the Placing Agreement nor the exercise or
performance of any of the Joint Bookrunners' rights and obligations
thereunder including any rights to waive or vary any conditions or
exercise any termination right;
31 acknowledges and accepts that the Joint Bookrunners may, in
accordance with applicable legal and regulatory provisions, engage
in transactions in relation to the Placing Shares and/or related
instruments for their own account for the purpose of hedging their
underwriting exposure or otherwise and, except as required by
applicable law or regulation, the Joint Bookrunners will not make
any public disclosure in relation to such transactions;
32 it has complied with its obligations in connection with money
laundering and terrorist financing under the Proceeds of Crime Act
2002, the Criminal Justice Act 1993, the Terrorism Act 2000, the
Terrorism Act 2006 and the Money Laundering, Terrorist Financing
and Transfer of Funds (Information on the Payer) Regulations 2017
and any related or similar rules, regulations or guidelines issued,
administered or enforced by any government agency having
jurisdiction in respect thereof (together the "Regulations") and,
if making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations;
33 its commitment to subscribe for Placing Shares on the terms
set out in this Announcement will continue notwithstanding any
amendment that may in future be made to the terms and conditions of
the Placing and that Placees will have no right to be consulted or
require that their consent be obtained with respect to WH Smith's
or the Joint Bookrunners' conduct of the Placing;
34 it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of subscribing for the Placing Shares. It further
acknowledges that it is experienced in investing in securities of
this nature and is aware that it may be required to bear, and is
able to bear, the economic risk of, and is able to sustain, a
complete loss in connection with the Placing. It has relied upon
its own examination and due diligence of the Group and its
affiliates taken as a whole, and the terms of the Placing,
including the merits and risks involved;
35 WH Smith, the Joint Bookrunners and others will rely upon the
truth and accuracy of the foregoing representations, warranties,
acknowledgements and agreements, which are given to each Joint
Bookrunner on its own behalf and on behalf of WH Smith and are
irrevocable;
36 if it is subscribing for the Placing Shares as a fiduciary or
agent for one or more investor accounts, it has full power and
authority to make, and does make, the foregoing representations,
warranties, acknowledgements, agreements and undertakings on behalf
of each such accounts;
37 time is of the essence as regards its obligations under this Appendix;
38 any document that is to be sent to it in connection with the
Placing will be sent at its risk and may be sent to it at any
address provided by it to the Joint Bookrunners;
39 the Placing Shares will be issued subject to the terms and
conditions set out in this Appendix; and
40 this Appendix and all documents into which this Appendix is
incorporated by reference or otherwise validly forms a part will be
governed by and construed in accordance with English law. All
agreements to subscribe for shares pursuant to the Bookbuilding
Process and/or the Placing will be governed by English law and the
English courts shall have exclusive jurisdiction in relation
thereto except that proceedings may be taken by WH Smith or the
Joint Bookrunners in any jurisdiction in which the relevant Placee
is incorporated or in which any of its securities have a quotation
on a recognised stock exchange.
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) agrees to indemnify and hold WH
Smith, each of the Joint Bookrunners and each of their respective
affiliates and each of their and their respective affiliates'
agents, directors, officers and employees, respectively, harmless
from any and all costs, claims, liabilities and expenses (including
legal fees and expenses) arising out of or in connection with any
breach of the representations, warranties, acknowledgements,
agreements and undertakings given by the Placee in this Appendix
and further agrees that the provisions of this Appendix shall
survive after completion of the Placing.
The agreement to allot and issue Placing Shares to Placees (or
the persons for whom Placees are contracting as agent) free of
stamp duty and stamp duty reserve tax in the UK relates only to
their allotment and issue to Placees, or such persons as they
nominate as their agents, directly by WH Smith. Such agreement
assumes that the Placing Shares are not being subscribed for in
connection with arrangements to issue depositary receipts or to
transfer the Placing Shares into a clearance service. If there were
any such arrangements, or the settlement related to other dealings
in the Placing Shares, stamp duty or stamp duty reserve tax may be
payable, for which neither WH Smith nor the Joint Bookrunners would
be responsible. If this is the case, it would be sensible for
Placees to take their own advice and they should notify the Joint
Bookrunners accordingly. In addition, Placees should note that they
will be liable for any capital duty, stamp duty and all other
stamp, issue, securities, transfer, registration, documentary or
other duties or taxes (including any interest, fines or penalties
relating thereto) payable outside the UK by them or any other
person on the subscription by them of any Placing Shares or the
agreement by them to subscribe for any Placing Shares and each
Placee, or the Placee's nominee, in respect of whom (or in respect
of the person for whom it is participating in the Placing as an
agent or nominee) the allocation, allotment, issue or delivery of
Placing Shares has given rise to such non-UK stamp, registration,
documentary, transfer or similar taxes or duties undertakes to pay
such taxes and duties, including any interest and penalties (if
applicable), forthwith and to indemnify on an after-tax basis and
to hold harmless WH Smith and the Joint Bookrunners in the event
that either WH Smith and/or the Joint Bookrunners have incurred any
such liability to such taxes or duties.
The representations, warranties, acknowledgements and
undertakings contained in this Appendix are given to the Joint
Bookrunners for themselves and on behalf of WH Smith and are
irrevocable.
The Joint Bookrunners are acting exclusively for WH Smith and no
one else in connection with the Bookbuilding Process and the
Placing and will not regard any other person (whether or not a
recipient of this document) as a client in relation to the
Bookbuilding Process or the Placing and will not be responsible to
anyone (including Placees) other than WH Smith for providing the
protections afforded to their clients or for providing advice in
relation to the Bookbuilding Process or the Placing or other
matters referred to in this Announcement.
Each Placee and any person acting on behalf of the Placee
acknowledges that the Joint Bookrunners do not owe any fiduciary or
other duties to any Placee in respect of any representations,
warranties, undertakings, acknowledgements or agreements or
indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that either of the Joint Bookrunners may
(at their absolute discretion) satisfy its obligations to procure
Placees by itself agreeing to become a Placee in respect of some or
all of the Placing Shares or by nominating any connected or
associated person to do so.
In the event that the Joint Bookrunners acquire Placing Shares
in the Placing, the Joint Bookrunners may co-ordinate disposals of
such shares in accordance with applicable law and regulation.
Except as required by applicable law or regulation, the Joint
Bookrunners do not propose to make any public disclosure in
relation to such transactions.
The price of shares and any income expected from them may go
down as well as up and investors may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance and persons needing advice should consult an
independent financial adviser.
All times and dates in this Announcement may be subject to
amendment. The Joint Bookrunners will notify Placees and any
persons acting on behalf of the Placees of any changes.
Neither the content of WH Smith's website nor any website
accessible by hyperlinks on WH Smith's website is incorporated in,
or forms part of, this Announcement.
APPIX B - KEY NOTES
1. Purchase price for 100% of Marshall Retail Group Holding
Company, Inc., on a debt-free cash-free basis subject to customary
closing adjustments.
2. Based on GBP:USD foreign exchange rate of GBP1:$1.282, as at 19:00 BST on 16 October 2019.
3. US airport travel retail market size excluding Duty Free and
Food & Beverages, per AXN Factbook.
4. Acquisition multiple calculated based on purchase price of
$400 million, divided by expected EBITDA of $31.5 million for the
financial year ending December 2019 less $2.3 million of pre-tax
profit attributable to minority partners (having minority partners
is mandatory under some US airport lease contracts). This amount
will be recognised, on a post-tax basis, as a non-controlling
interest in WH Smith's income statement going forward.
5. EBITDA on a fully consolidated basis excluding certain
non-recurring items. As is mandatory in some US airport lease
contracts (and consistent with InMotion), MRG has minority
partners. The share of post-tax profit attributable to those
minority partners will be recognised as a non-controlling interest
in WH Smith's income statement going forward.
6. Based on stores awarded to date (33 airport, 3 tourist /
resort); awarded stores may be subject to delayed opening.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCUBVRRKWARARA
(END) Dow Jones Newswires
October 17, 2019 02:00 ET (06:00 GMT)
Wh Smith (LSE:SMWH)
Historical Stock Chart
From Apr 2024 to May 2024
Wh Smith (LSE:SMWH)
Historical Stock Chart
From May 2023 to May 2024