TIDMPHD
RNS Number : 2907X
Pollen Street Capital
30 April 2021
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, IN OR INTO ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
FOR IMMEDIATE RELEASE
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
30 APRIL 2021
RECOMMED Acquisition
of
proactis holdings PLC
by
CAFE BIDCO LIMITED
(a wholly-owned subsidiary of investment funds advised and
managed by
POLLEN STREET CAPITAL LIMITED)
to be effected by means of a scheme of arrangement under Part 26
of the Companies Act 2006
Summary
-- The boards of Cafe Bidco Limited ("Bidco") and Proactis
Holdings plc ("Proactis") are pleased to announce they have reached
agreement on the terms and conditions of a recommended cash offer
by Bidco for the entire issued and to be issued share capital of
Proactis (the "Acquisition").
-- Under the terms of the Acquisition, each Proactis Shareholder will be entitled to receive:
for each Proactis Share: 75 pence in cash (the "Cash Offer")
-- The price per Proactis Share under the terms of the Cash
Offer represents a premium of approximately:
o 79.4 per cent. to the closing price of 41.8 pence per Proactis
Share on 29 April 2021 (being the last Business Day prior to the
commencement of the Offer Period);
o 70.7 per cent. to the volume-weighted average price of 43.9
pence per Proactis Share for the three months ended 29 April 2021
(being the last Business Day prior to the commencement of the Offer
Period);
o 75.8 per cent. to the volume-weighted average price of 42.7
pence per Proactis Share for the six months ended 29 April 2021
(being the last Business Day prior to the commencement of the Offer
Period); and
o 106.4 per cent. to the volume-weighted average price of 36.3
pence per Proactis Share for the 12 months ended 29 April 2021
(being the last Business Day prior to the commencement of the Offer
Period).
-- The Acquisition values the entire issued ordinary share
capital of Proactis at approximately GBP71.6 million.
-- As an alternative to the Cash Offer, eligible Proactis
Shareholders may elect to receive 0.75 Alternative Offer Securities
in the capital of Topco in exchange for each Proactis Share (the
"Alternative Offer"), subject to the terms and conditions of the
Alternative Offer (detailed in paragraph 13 of the full
announcement and to be set out in the Scheme Document). An eligible
Proactis Shareholder may elect to take up the Alternative Offer in
respect of all or part of their holding of Proactis Shares. For the
purposes of Rule 24.11 of the Takeover Code, Houlihan Lokey, as
financial advisers to Bidco, will provide an estimate of the value
of an Alternative Offer Security, together with the assumptions,
qualifications and caveats forming the basis of its estimate of
value, in a letter to be included in the Scheme Document. Certain
details of the Alternative Offer Securities are set out in Appendix
4 to the full announcement. Further information about the
Alternative Offer Securities and the Alternative Offer will be
included in the Scheme Document.
-- If, on or after the date of this announcement and before the
Effective Date, any dividend and/or other distribution and/or other
return of capital is declared, made or paid or becomes payable in
respect of Proactis Shares, Bidco reserves the right to reduce the
consideration payable under the terms of the Cash Offer (and, as
the case may be, the number of Alternative Offer Securities due
under the terms of the Alternative Offer) by an amount up to the
amount of such dividend and/or distribution and/or return of
capital, in which case any reference in this announcement to the
consideration payable under the Cash Offer (or consideration due
under the Alternative Offer) will be deemed to be a reference to
the consideration as so reduced. Any exercise by Bidco of its
rights referred to in this paragraph shall be the subject of an
announcement and, for the avoidance of doubt, shall not be regarded
as constituting any revision or variation of the terms of the
Acquisition. In such circumstances, Proactis Shareholders would be
entitled to retain any such dividend, distribution or other return
of capital declared, made or paid or which becomes payable.
-- The Acquisition is intended to be effected by way of a
Scheme. However, Bidco reserves the right to elect (with the
consent of the Panel and subject to the terms of the Co-operation
Agreement) to implement the Acquisition by way of an Offer.
Recommendation
-- The Proactis Directors, who have been so advised by finnCap
as to the financial terms of the Cash Offer, consider the terms of
the Cash Offer to be fair and reasonable. In providing its advice
to the Proactis Directors, finnCap has taken into account the
commercial assessments of the Proactis Directors. finnCap is
providing independent financial advice to the Proactis Directors
for the purposes of Rule 3 of the Takeover Code.
-- Accordingly, the Proactis Directors intend to recommend
unanimously that the Proactis Shareholders vote in favour of the
Scheme at the Court Meeting and the Special Resolutions to be
proposed at the General Meeting, as the Proactis Directors who are
interested in Proactis Shares have irrevocably undertaken to do (or
procure to be done) in respect of their own beneficial holdings of,
in aggregate, 10,823,504 Proactis Shares, representing
approximately 11.33 per cent. of the issued ordinary share capital
of Proactis on 29 April 2021 (being the last Business Day prior to
the date of this announcement). Further details of these
undertakings, including the circumstances in which they cease to be
binding, are set out in Appendix 3 to the full announcement.
-- The Proactis Directors cannot form an opinion as to whether
or not the terms of the Alternative Offer are fair and reasonable
and are not making any recommendation to Proactis Shareholders as
to whether or not they should elect for the Alternative Offer. The
Proactis Directors consider that, in deciding whether or not to
elect for the Alternative Offer, the Proactis Shareholders should
take their own independent advice and consider carefully the
disadvantages and advantages of electing for the Alternative Offer
(including, but not limited to, those set out in paragraph 3 of the
full announcement) in light of their own financial circumstances
and investment objectives. Alan Aubrey and Rodney Potts have each
irrevocably undertaken to partially elect for the Alternative Offer
(subject to the terms and conditions of the Alternative Offer as
set out in paragraph 13 below and to be set out in the Scheme
Document), in each case in respect of their beneficial holdings of
520,976 Proactis Shares and 3,065,143 Proactis Shares respectively,
representing in aggregate approximately 3.75 per cent. of the
issued ordinary share capital of Proactis on 29 April 2021 (being
the last Business Day prior to the date of this announcement). Each
of Alan Aubrey and Rodney Potts have irrevocably undertaken to
elect for the Cash Offer in respect of the remainder of their
beneficial holdings of Proactis Shares. The remaining Proactis
Directors, being Tim Sykes, Richard Hughes and Nick Brown, have
each irrevocably undertaken to elect for the Cash Offer in respect
of the entirety of their beneficial holdings of Proactis Shares.
Further details of these undertakings, including the circumstances
in which they cease to be binding, are set out in Appendix 3 to the
full announcement. Further details of the Alternative Offer are set
out in paragraphs 13, 14 and 15 of the full announcement, and
Appendix 4 to the full announcement.
Background to and reasons for the Acquisition
-- Bidco believes that Proactis has successfully developed a
leading position in the business spend management software market
with a range of solutions offering a compelling value proposition
to its client bases across Europe and North America.
-- Bidco also considers there to be significant scope for
increased adoption of business spend management solutions as
companies increasingly seek to digitise processes, in particular in
the mid-market where such solutions are currently less
highly-adopted than amongst larger corporates. As a
well-established provider with a footprint in five significant
international markets, and a leading core set of software solutions
focused on mid-sized companies, Bidco believes Proactis has the
potential to capitalise successfully on this trend.
-- To maximise the market opportunity and become a global market
leader to mid-sized corporates, Bidco believes that Proactis would
benefit from returning to private ownership with the support of a
growth-focused shareholder, who can provide the capital and
long-term view of value creation to enable the management team to
make the investment in products, sales and marketing, and
infrastructure necessary to capitalise on the market
opportunity.
-- Pollen Street Capital will provide Proactis and its
management team with the flexibility to take these long-term
decisions to maximise the growth potential of the business, whilst
also providing strategic support to develop new growth areas and
operational expertise to drive efficiency.
Irrevocable undertakings
-- The Proactis Directors have irrevocably undertaken to vote
(or, where applicable, procure voting) in favour of the Scheme at
the Court Meeting and the Special Resolutions to be proposed at the
General Meeting (or in the event that the Acquisition is
implemented by an Offer, to accept or procure acceptance of such
Offer) in respect of their own beneficial holdings of, in
aggregate, 10,823,504 Proactis Shares, representing approximately
11.33 per cent. of the existing issued ordinary share capital of
Proactis as at 29 April 2021 (being the last Business Day prior to
the date of this announcement).
-- In addition to the irrevocable undertakings from the Proactis
Directors described above, Bidco has also received irrevocable
undertakings to vote (or, where applicable, procure voting) in
favour of the Scheme at the Court Meeting and the Special
Resolutions to be proposed at the General Meeting (or in the event
that the Acquisition is implemented by an Offer, to accept or
procure acceptance of such Offer) from Lombard Odier Asset
Management (Europe) Limited and Gresham House Asset Management
Limited in respect of 28,066,683 Proactis Shares and 6,104,954
Proactis Shares respectively, representing, in aggregate,
approximately 35.77 per cent. of the existing issued ordinary share
capital of Proactis as at 29 April 2021 (being the last Business
Day prior to the date of this announcement).
-- In total, therefore, Bidco has procured irrevocable
undertakings to vote (or, where applicable, procure voting) in
favour of the Scheme at the Court Meeting and the Special
Resolutions to be proposed at the General Meeting (or in the event
that the Acquisition is implemented by an Offer, to accept or
procure acceptance of such Offer) in respect of, in aggregate,
44,995,141 Proactis Shares, representing approximately 47.10 per
cent. of the existing issued ordinary share capital of Proactis as
at 29 April 2021 (being the last Business Day prior to the date of
this announcement). Further details of these irrevocable
undertakings, including the circumstances in which they cease to be
binding, are set out in Appendix 3 to the full announcement.
Information on Bidco and Pollen Street Capital
-- Bidco is a limited company registered in England and Wales
and incorporated on 20 April 2021. Bidco was formed for the
purposes of the Acquisition and is a wholly-owned indirect
subsidiary of investment funds advised and managed by Pollen Street
Capital. Bidco has not traded since its date of incorporation, nor
has it entered into any obligations other than in connection with
the Acquisition.
-- Pollen Street Capital is one of Europe's leading specialist
private equity investors in the financial and business services
sectors, having invested over GBP2 billion since 2003 in a range of
businesses across all stages of development. Pollen Street Capital
works with entrepreneurial management teams to build businesses
that deliver market-leading products and services to their
customers, in order to create long-term sustainable success.
Information on Proactis
-- Proactis is an international business spend management
solution provider operating with a market-facing presence in the
United Kingdom, United States, France, Germany and the Netherlands.
Proactis enables digital trade by helping organisations around the
world to control 100 per cent. of their spend. Proactis works with
its customers to transform their Source-to-Pay processes; to help
them save money and create efficiency gains while increasing
compliance and reducing risk. Proactis believes its solutions are
used in approximately 1,100 buying organisations around the world,
with over three million users who have over two million supplier
relationships, in over 100 countries across the commercial, public
and not-for-profit sectors.
-- Proactis was incorporated in 2006 and shortly thereafter the
Proactis Shares were admitted to trading on AIM. In the financial
year ended 31 July 2020 (audited), the business generated GBP49.6
million of revenue and adjusted EBITDA of GBP11.8 million, and
reported GBP41.2 million of annual recurring revenue. For the half
year ended 31 January 2021 (unaudited), the business generated
GBP23.8 million of revenue and adjusted EBITDA of GBP6.2 million,
and reported GBP40.8 million of annual recurring revenue.
Timetable and conditions
-- It is intended that the Acquisition will be implemented by
way of a Scheme (although Bidco reserves the right to effect the
Acquisition by way of an Offer, subject to the consent of the Panel
and the terms of the Co-operation Agreement). The terms of the
Acquisition will be put to Proactis Shareholders at the Court
Meeting and the General Meeting (which is expected to take place
immediately following the Court Meeting). The Meetings are required
to enable Proactis Shareholders to consider and, if thought fit,
vote in favour of resolutions to approve the Scheme and its
implementation. In order to become Effective, the Scheme must be
approved at the Court Meeting by a majority in number of Scheme
Shareholders, present and voting, whether in person or by proxy,
representing 75 per cent. or more in nominal value of the Scheme
Shares held by those Scheme Shareholders. The Scheme also requires
the passing at the General Meeting of the Special Resolutions. The
Scheme is expected to become Effective in Q3 of the calendar year
2021.
-- The Acquisition will be on the terms and subject to the
Conditions set out in Appendix 1 to the full announcement. Full
details of the Acquisition will be provided in the Scheme Document.
It is expected that the Scheme Document, containing further
information about the Acquisition and notices of the Meetings,
together with the associated forms of proxy, will be posted to
Proactis Shareholders within 28 days of this announcement (or such
later time as Proactis, Bidco and the Panel agree) and the Meetings
are expected to be held shortly thereafter. An expected timetable
of key events relating to the Acquisition will be provided in the
Scheme Document.
-- Commenting on the Acquisition, Alan Aubrey, the Chairman of Proactis, said:
"We are proud of the significant progress that Proactis has made
over the past year, particularly after a very difficult period in
Proactis' history. Whilst we remain excited about the prospects for
the business, we have been in discussions with Bidco and received a
proposal that we believe is compelling for all of our stakeholders.
We are pleased that Bidco is supportive of the acceleration of
Proactis' existing strategy and believe that Proactis will benefit
from Pollen Street Capital's considerable financial resources,
longer-term approach to value creation, and significant experience
in successfully backing high-growth businesses to achieve their
full potential. As a result of the Acquisition, we believe Proactis
will be both nimbler in executing its strategy and able to build a
business capable of sustainable longer-term growth.
Having carefully considered the range of options available to
Proactis, including the terms of the proposed Acquisition by Bidco,
the Proactis Directors have concluded that the Acquisition, which
offers certainty of certain cash value to the Proactis Shareholders
as well as the ability to retain a shareholding in the business
going forward, is in the best interests of Proactis, its
shareholders and wider stakeholders, and as such are unanimously
recommending the Cash Offer to shareholders."
-- Commenting on the Acquisition, Matthew Potter, Partner of Pollen Street Capital said:
"We are pleased to have reached agreement with the board of
Proactis on the terms of Bidco's offer to Proactis Shareholders. We
believe Proactis would strongly benefit from a return to private
ownership with the support of a growth-focused shareholder, which
would enable Proactis to accelerate its plans to capitalise on a
clear market opportunity. Pollen Street Capital has strong heritage
in supporting companies with the potential to be market leaders in
the financial and business services sectors, and we are excited by
the opportunity to work with Proactis and its team in achieving its
ambitious goals."
This summary should be read in conjunction with, and is subject
to, the following full announcement and the Appendices. The
Acquisition will be subject to the Conditions and other terms set
out in this announcement and to the full terms and conditions which
will be set out in the Scheme Document. The Conditions to, and
certain further terms of, the Acquisition are set out in Appendix 1
to the full announcement. The sources and bases of calculation of
certain information contained in this announcement are set out in
Appendix 2 to the full announcement. Details of irrevocable
undertakings received by Bidco are set out in Appendix 3 to the
full announcement. Certain details of the Alternative Offer
Securities are set out in Appendix 4 to the full announcement.
Certain terms used in this announcement are defined in Appendix 5
to the full announcement.
Enquiries:
Houlihan Lokey +44 (0)20 7907 4200
(Financial Adviser to Bidco)
Lawrence Guthrie
Mark Fisher
Yashin Mody
Stand Agency
(Communications adviser to Pollen Street Capital)
Cait Dacey +44 (0) 7973 596 503
Proactis +44 (0)19 3754 5070
Tim Sykes
Richard Hughes
finnCap +44 (0)20 7220 0500
(Financial Adviser to Proactis)
Carl Holmes
Henrik Persson
Emily Watts
Slaughter and May is acting as legal adviser to Bidco.
Walker Morris LLP is acting as legal adviser to Proactis.
Important notices relating to financial advisers
Houlihan Lokey, which is authorised and regulated by the FCA in
the United Kingdom, is acting exclusively as financial adviser to
Bidco and no one else in connection with the matters described in
this announcement and will not be responsible to anyone other than
Bidco for providing the protections afforded to clients of Houlihan
Lokey or for providing advice in relation to the Acquisition or any
other matters referred to in this announcement. Neither Houlihan
Lokey nor any of its subsidiaries or affiliates owes or accepts any
duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Houlihan Lokey in connection
with this announcement or any matter referred to in this
announcement.
finnCap, which is authorised and regulated by the FCA in the
United Kingdom, is acting exclusively for Proactis as financial
adviser and no one else in connection with the Acquisition and will
not be responsible to anyone other than Proactis for providing the
protections afforded to clients of finnCap or for providing advice
in relation to the Acquisition or any other matters referred to in
this announcement. Neither finnCap nor any of its subsidiaries,
affiliates or branches owes or accepts any duty, liability or
responsibility whatsoever (whether direct, indirect, consequential,
whether in contract, in tort, under statute or otherwise) to any
person who is not a client of finnCap in connection with this
announcement, any statement contained in this announcement or
otherwise.
Further information
This announcement is for information purposes only and is not
intended to, and does not, constitute or form part of any offer or
inducement to sell or an invitation to purchase, otherwise acquire,
subscribe for, sell or otherwise dispose of, any securities or the
solicitation of an offer to buy any securities, any vote or
approval in any jurisdiction pursuant to the Acquisition or
otherwise. The Acquisition will be made solely pursuant to the
terms of the Scheme Document (or, if the Acquisition is implemented
by way of an Offer, the Offer Document), which will contain the
full terms and conditions of the Acquisition, including details of
what action is required from Proactis Shareholders in respect of
the Acquisition. Any decision in respect of, or other response to,
the Acquisition should be made only on the basis of the information
in the Scheme Document (or, if the Acquisition is implemented by
way of an Offer, the Offer Document).
Proactis and Bidco shall prepare the Scheme Document (or, if the
Acquisition is implemented by way of an Offer, the Offer Document)
to be distributed to Proactis Shareholders. Proactis and Bidco urge
Proactis Shareholders to read the Scheme Document in its entirety
(or, if the Acquisition is implemented by way of an Offer, the
Offer Document) when it becomes available because it will contain
important information relating to the Acquisition.
This announcement does not constitute a prospectus or prospectus
equivalent document.
Bidco reserves the right to elect to implement the Acquisition
by way of an Offer as an alternative to the Scheme (subject to the
Panel's consent and the terms of the Co-operation Agreement). In
such event, the Acquisition will be implemented on substantially
the same terms, so far as applicable, as those which will apply to
the Scheme, subject to appropriate amendments to reflect, among
other things, the change in method of effecting the Acquisition
(including, without limitation: (i) the inclusion of an acceptance
condition set at 75 per cent. of the Proactis Shares to which such
Offer relates (or such other percentage as Bidco may, subject to
the rules of the Takeover Code and the terms of the Co-operation
Agreement and with the consent of the Panel, decide); and (ii)
those required by, or deemed appropriate by, Bidco under applicable
law, including US securities law). Further, if sufficient
acceptances of such Offer are received and/or sufficient Proactis
Shares are otherwise acquired, it is the intention of Bidco to
apply the provisions of the Companies Act 2006 to acquire
compulsorily any outstanding Proactis Shares to which such Offer
relates.
Overseas Shareholders
This announcement has been prepared in accordance with and for
the purpose of complying with the laws of England and Wales, the
Takeover Code, the Market Abuse Regulation, the AIM Rules and the
Disclosure Guidance and Transparency Rules and 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 of jurisdictions outside England.
The release, publication or distribution of this announcement in
or into certain jurisdictions other than the United Kingdom may be
restricted by law and therefore any persons who are subject to the
laws of any jurisdiction other than the United Kingdom should
inform themselves of, and observe, any applicable requirements of
their jurisdictions.
The availability of the Acquisition to Proactis Shareholders who
are not resident in and citizens of the United Kingdom may be
affected by the laws of the relevant jurisdictions in which they
are located or of which they are citizens. Persons who are not
resident in and citizens of the United Kingdom should inform
themselves of, and observe, any applicable legal or regulatory
requirements of their jurisdictions. In particular, the ability of
persons who are not resident in and citizens of the United Kingdom
to vote their Proactis Shares with respect to the Scheme at the
Court Meeting, or to execute and deliver forms of proxy appointing
another person to vote at the Court Meeting on their behalf, may be
affected by the laws of the relevant jurisdictions in which they
are located or of which they are a citizen. Any failure to comply
with the applicable restrictions may constitute a violation of the
securities laws of any such jurisdiction. To the fullest extent
permitted by applicable law, the companies and persons involved in
the Acquisition disclaim any responsibility or liability for the
violation of such restrictions by any person.
Unless otherwise determined by Bidco or required by the Takeover
Code, and permitted by applicable law and regulation, participation
in the Acquisition will not be made available, directly or
indirectly, in, into or from a Restricted Jurisdiction where to do
so would violate the laws in that jurisdiction and no person may
vote in favour of the Acquisition by any such use, means,
instrumentality or from within a Restricted Jurisdiction or any
other jurisdiction if to do so would constitute a violation of the
laws of that jurisdiction. Accordingly, copies of this announcement
and any formal documentation relating to the Acquisition are not
being, and must not be, directly or indirectly, mailed or otherwise
forwarded, distributed or sent in, into or from any Restricted
Jurisdiction and persons receiving this announcement and all such
documents relating to the Acquisition (including custodians,
nominees and trustees) must not mail or otherwise forward,
distribute or send them in, into or from any Restricted
Jurisdiction. Doing so may render invalid any related purported
vote in respect of the Acquisition. If the Acquisition is
implemented by way of an Offer (unless otherwise permitted by
applicable law and regulation), the Offer may not be made directly
or indirectly, in or into, or by the use of mails or any means or
instrumentality (including, but not limited to, facsimile, e-mail
or other electronic transmission, telex or telephone) of interstate
or foreign commerce of, or of any facility of a national, state or
other securities exchange of, any Restricted Jurisdiction and the
Offer may not be capable of acceptance by any such use, means,
instrumentality or facilities.
Further details in relation to Overseas Shareholders will be
contained in the Scheme Document.
Notice to US investors in Proactis
Proactis Shareholders in the United States should note that the
Acquisition relates to the shares of an English company and is
proposed to be made by means of a scheme of arrangement provided
for under, and governed by, the laws of England and Wales. If the
Acquisition is carried out under such Scheme, it is expected that
any Alternative Offer Securities issued pursuant to the Acquisition
would be issued in reliance upon the exemption from the
registration requirements under the US Securities Act provided by
Section 3(a)(10) thereof and would not be registered under the US
Securities Act. Securities issued pursuant to the Scheme will not
be registered under any laws of any state, district or other
jurisdiction of the United States, and may only be issued to
persons resident in such state, district or other jurisdiction
pursuant to an exemption from the registration requirements of such
laws.
Neither the proxy solicitation nor the tender offer rules under
the US Exchange Act will apply to the Scheme. Moreover, the Scheme
will be subject to the disclosure and procedural requirements and
practices applicable in the United Kingdom to schemes of
arrangement, which differ from the disclosure requirements of US
tender offer and proxy solicitation rules. If, in the future, Bidco
exercises the right to implement the Acquisition by way of an Offer
and determines to extend the offer into the United States, the
Acquisition will be made in compliance with applicable United
States laws and regulations, including any applicable exemptions
under the US Exchange Act. Such an Offer would be made in the
United States by Bidco and no one else. In accordance with normal
United Kingdom practice and consistent with Rule 14e-5 under the US
Exchange Act, Bidco, certain affiliated companies and the nominees
or brokers (acting as agents) may make certain purchases of, or
arrangements to purchase, shares in Proactis outside such Offer
during the period in which such Offer would remain open for
acceptance. If such purchases or arrangements to purchase were to
be made they would be made outside the United States
either in the open market at prevailing prices or in private
transactions at negotiated prices and would comply with applicable
law, including, to the extent applicable, the US Exchange Act. Any
information about such purchases will be disclosed as required in
the United Kingdom, will be reported to a Regulatory Information
Service and will be available on the London Stock Exchange website
at www.londonstockexchange.com.
The financial information included in this announcement and the
Scheme Document (or, if the Acquisition is implemented by way of an
Offer, the Offer Document) has been or will have been prepared in
accordance with generally accepted accounting principles of the
United Kingdom and thus may not be comparable to the financial
information of US companies or companies whose financial statements
are prepared in accordance with generally accepted accounting
principles in the United States.
The receipt of consideration by a US holder for the transfer of
its Proactis Shares pursuant to the Acquisition may be a taxable
transaction for US federal income tax purposes and under applicable
US state and local, as well as non-US and other, tax laws. Each
Proactis Shareholder is urged to consult their independent
professional adviser immediately regarding the tax consequences of
the Acquisition applicable to them, including under applicable US
federal, state and local, as well as non-US and other, tax
laws.
It may be difficult for US holders of Proactis Shares to enforce
their rights and any claim arising out of the US federal laws or to
enforce against them a judgment of a US court predicated upon the
securities laws of the United Kingdom, since Bidco and Proactis are
incorporated in a non-US jurisdiction, and some or all of their
officers and directors may be residents of countries other than the
United States. US holders of Proactis Shares may not be able to sue
a non-US company or its officers or directors in a non-US court for
violations of the US securities laws. Further, it may be difficult
to compel a non-US company and its affiliates to subject themselves
to a US court's judgement.
Cautionary note regarding forward-looking statements
This announcement (including information incorporated by
reference in this announcement), oral statements made regarding the
Acquisition, and other information published by Bidco and Proactis
contain certain statements which are, or may be deemed to be,
"forward-looking statements". Forward-looking statements are
prospective in nature and are not based on historical facts, but
rather on current expectations and projections of the management of
Bidco and Proactis about future events, and are therefore subject
to risks and uncertainties which could cause actual results to
differ materially from the future results expressed or implied by
the forward-looking statements.
These forward-looking statements can be identified by the fact
that they do not relate only to historical or current facts.
Forward-looking statements often use words such as "anticipate",
"target", "expect", "estimate", "intend", "plan", "goal",
"believe", "hope", "aims", "continue", "will", "may", "should",
"would", "could", or other words of similar meaning or derivatives
thereof. These statements are based on assumptions and assessments
made by Proactis and/or Bidco in light of their experience and
their perception of historical trends, current conditions, future
developments and other factors they believe appropriate. By their
nature, forward-looking statements involve risk and uncertainty,
because they relate to events and depend on circumstances that will
occur in the future and the factors described in the context of
such forward-looking statements in this announcement could cause
actual results and developments to differ materially from those
expressed in or implied by such forward-looking statements. Among
the factors that could cause actual results to differ materially
from those described in the forward-looking statements are changes
in the global, political, economic, business, competitive, market
and regulatory forces, future exchange and interest rates, changes
in tax rates and future business combinations or dispositions.
Although it is believed that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be
given that such expectations will prove to have been correct and
you are therefore cautioned not to place undue reliance on these
forward-looking statements which speak only as at the date of this
announcement. Neither Proactis nor Bidco assumes any obligation to
update or correct the information contained in this announcement
(whether as a result of new information, future events or
otherwise), except as required by applicable law.
Dealing and opening position disclosure requirements
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in one per cent. or more of any class of relevant
securities of an offeree company or of any securities exchange
offeror (being any offeror other than an offeror in respect of
which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following
the commencement of the offer period and, if later, following the
announcement in which any securities exchange offeror is first
identified.
An Opening Position Disclosure must contain details of the
person's interests and short positions in, and rights to subscribe
for, any relevant securities of each of (i) the offeree company and
(ii) any securities exchange offeror(s). An Opening Position
Disclosure by a person to whom Rule 8.3(a) applies must be made by
no later than 3.30 p.m. (London time) on the 10(th) business day
following the commencement of the offer period and, if appropriate,
by no later than 3.30 p.m. (London time) on the 10(th) business day
following the announcement in which any securities exchange offeror
is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a securities exchange
offeror prior to the deadline for making an Opening Position
Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in one per cent. or more of any class of
relevant securities of the offeree company or of any securities
exchange offeror must make a Dealing Disclosure if the person deals
in any relevant securities of the offeree company or of any
securities exchange offeror. A Dealing Disclosure must contain
details of the dealing concerned and of the person's interests and
short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror, save to the extent that these details
have previously been disclosed under Rule 8. A Dealing Disclosure
by a person to whom Rule 8.3(b) applies must be made by no later
than 3.30 p.m. (London time) on the business day following the date
of the relevant dealing. If two or more persons act together
pursuant to an agreement or understanding, whether formal or
informal, to acquire or control an interest in relevant securities
of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on a website
In accordance with Rule 26.1 of the Takeover Code, a copy of
this announcement will be made available, subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions, on Proactis' website at
https://www.proactis.com/uk/investors/ and Bidco's website at
https://cafe.pollencap.com by no later than 12 noon (London time)
on the first Business Day following the date of this announcement.
For the avoidance of doubt, neither the contents of these websites
nor any website accessible from hyperlinks is incorporated into or
forms part of this announcement.
No profit forecasts, estimates or quantified benefits
statements
No statement in this announcement is intended to constitute a
profit forecast, profit estimate or quantified benefits statement
for any period and no statement in this announcement should be
interpreted to mean that the earnings or future earnings per share
of, or dividends or future dividends per share of, Proactis for the
current or future financial years will necessarily match or exceed
the historical published earnings or earnings per share or
dividends per share of Proactis.
Requesting hard copy documents
In accordance with Rule 30.3 of the Takeover Code, Proactis
Shareholders, persons with information rights and participants in
Proactis Share Plans may request a hard copy of this announcement
by contacting Proactis' registrars, Link Group: (i) on +44 (0) 371
664 0300. Calls are charged at the standard geographic rate and
will vary by provider. Calls outside the United Kingdom will be
charged at the applicable international rate. Lines are open
between 09:00 - 17:30, Monday to Friday excluding public holidays
in England and Wales; or (ii) by submitting a request in writing to
Link Group, 10th Floor, Central Square, 29 Wellington Street,
Leeds, LS1 4DL. Please note that Link Group cannot provide any
financial, legal or tax advice and calls may be recorded and
monitored for security and training purposes. For persons who
receive a copy of this announcement in electronic form or via a
website notification, a hard copy of this announcement will not be
sent unless so requested. Such persons may also request that all
future documents, announcements and information to be sent to them
in relation to the Acquisition should be in hard copy form.
Electronic communications
Please be aware that addresses, electronic addresses and certain
other information provided by Proactis Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Proactis may be provided to Bidco during the
Offer Period as required under Section 4 of Appendix 4 of the
Takeover Code to comply with Rule 2.11(c).
Rounding
Certain figures included in this announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of figures that precede them.
General
If the Acquisition is effected by way of an Offer, and such an
Offer becomes or is declared unconditional in all respects and
sufficient acceptances are received, Bidco intends to exercise its
rights to apply the provisions of Chapter 3 of Part 28 of the
Companies Act 2006 so as to acquire compulsorily the remaining
Proactis Shares in respect of which the Offer has not been
accepted.
Investors should be aware that Bidco may purchase Proactis
Shares otherwise than under any Offer or the Scheme, including
pursuant to privately negotiated purchases.
If you are in any doubt about the contents of this announcement
or the action you should take, you are recommended to seek your own
independent financial advice immediately from your stockbroker,
bank manager, solicitor or independent financial adviser duly
authorised under FSMA if you are resident in the United Kingdom or,
if not, from another appropriate authorised independent financial
adviser.
Rule 2.9 of the Takeover Code
For the purposes of Rule 2.9 of the Takeover Code, Proactis
confirms that, as at 29 April 2021 (being the last Business Day
prior to this announcement), it had in issue 95,532,628 ordinary
shares of 10 pence each (excluding shares held in treasury). The
ISIN for the ordinary shares is GB00B13GSS58.
Not for release, publication or distribution, in whole or in
part, in or into any jurisdiction where to do so would constitute a
violation of the relevant laws of such jurisdiction
FOR IMMEDIATE RELEASE
This announcement contains inside information
30 APRIL 2021
RECOMMED acquisition
of
Proactis holdings plc
by
CAFE BIDCO LIMITED
(a wholly-owned indirect subsidiary of investment funds advised
and managed by POLLEN STREET CAPITAL LIMITED)
to be effected by means of a scheme of arrangement under Part 26
of the Companies Act 2006
1. Introduction
The boards of Cafe Bidco Limited ("Bidco") and Proactis Holdings
plc ("Proactis") are pleased to announce that they have reached
agreement on the terms and conditions of a recommended cash offer
by Bidco for the entire issued and to be issued share capital of
Proactis (the "Acquisition").
2. The Acquisition
Under the terms of the Acquisition, which will be subject to the
Conditions and further terms set out in Appendix 1 to this
announcement and the full terms and conditions to be set out in the
Scheme Document, each Proactis Shareholder will be entitled to
receive:
for each Proactis Share: 75 pence in cash (the "Cash Offer")
The price per Proactis Share under the terms of the Cash Offer
represents a premium of approximately:
-- 79.4 per cent. to the closing price of 41.8 pence per
Proactis Share on 29 April 2021 (being the last Business Day prior
to the commencement of the Offer Period);
-- 70.7 per cent. to the volume-weighted average price of 43.9
pence per Proactis Share for the three months ended 29 April 2021
(being the last Business Day prior to the commencement of the Offer
Period);
-- 75.8 per cent. to the volume-weighted average price of 42.7
pence per Proactis Share for the six months ended 29 April 2021
(being the last Business Day prior to the commencement of the Offer
Period); and
-- 106.4 per cent. to the volume-weighted average price of 36.3
pence per Proactis Share for the 12 months ended 29 April 2021
(being the last Business Day prior to the commencement of the Offer
Period).
The Acquisition values the entire issued ordinary share capital
of Proactis at approximately GBP71.6 million.
As an alternative to the Cash Offer, eligible Proactis
Shareholders may elect to receive 0.75 Alternative Offer Securities
in the capital of Topco in exchange for each Proactis Share (the
"Alternative Offer"), subject to the terms and conditions of the
Alternative Offer (detailed in paragraph 13 below and to be set out
in the Scheme Document). An eligible Proactis Shareholder may elect
to take up the Alternative Offer in respect of all or part of their
holding of Proactis Shares. The Alternative Offer Securities will
be independently valued and an estimate of the value of the
Alternative Offer Securities will be included in the Scheme
Document. Certain details of the Alternative Offer Securities are
set out in Appendix 4 to this announcement. Further information
about the Alternative Offer Securities and the Alternative Offer
will be included in the Scheme Document.
The Proactis Shares will be acquired pursuant to the Acquisition
fully paid and free from all liens, charges, equities,
encumbrances, rights of pre-emption and any other interest of any
nature whatsoever and together with all rights attaching thereto,
including without limitation voting rights and the rights to
receive and retain in full all dividends and distributions (if any)
announced, declared, made or paid with a record date on or after
the Scheme Record Time.
If, on or after the date of this announcement and before the
Effective Date, any dividend and/or other distribution and/or other
return of capital is declared, made or paid or becomes payable in
respect of Proactis Shares, Bidco reserves the right to reduce the
consideration payable under the terms of the Cash Offer (and, as
the case may be, the number of Alternative Offer Securities due
under the terms of the Alternative Offer) by an amount up to the
amount of such dividend and/or distribution and/or return of
capital, in which case any reference in this announcement to the
consideration payable under the Cash Offer (or consideration due
under the Alternative Offer) will be deemed to be a reference to
the consideration as so reduced. Any exercise by Bidco of its
rights referred to in this paragraph shall be the subject of an
announcement and, for the avoidance of doubt, shall not be regarded
as constituting any revision or variation of the terms of the
Acquisition. In such circumstances, Proactis Shareholders would be
entitled to retain any such dividend, distribution or other return
of capital declared, made or paid or which becomes payable.
It is intended that the Acquisition will be implemented by way
of a Scheme (although Bidco reserves the right to effect the
Acquisition by way of an Offer, subject to the consent of the Panel
and the terms of the Co-operation Agreement). The Conditions to the
Acquisition are set out in full in Appendix 1 to this
announcement.
3. Recommendation
The Proactis Directors, who have been so advised by finnCap as
to the financial terms of the Cash Offer, consider the terms of the
Cash Offer to be fair and reasonable. In providing its advice to
the Proactis Directors, finnCap has taken into account the
commercial assessments of the Proactis Directors. finnCap is
providing independent financial advice to the Proactis Directors
for the purposes of Rule 3 of the Takeover Code.
Accordingly, the Proactis Directors intend to recommend
unanimously that the Proactis Shareholders vote in favour of the
Scheme at the Court Meeting and the Special Resolutions to be
proposed at the General Meeting, as the Proactis Directors who are
interested in Proactis Shares have irrevocably undertaken to do (or
procure to be done) in respect of their own beneficial holdings of,
in aggregate, 10,823,504 Proactis Shares representing approximately
11.33 per cent. of the issued ordinary share capital of Proactis on
29 April 2021 (being the last Business Day prior to the date of
this announcement). Further details of these undertakings,
including the circumstances in which they cease to be binding, are
set out in Appendix 3 to this announcement.
The Proactis Directors and finnCap have considered the
disadvantages and advantages outlined below in relation to the
Alternative Offer. finnCap is unable to advise the Proactis
Directors as to whether or not the financial terms of the
Alternative Offer are fair and reasonable. This is because of the
significant and variable impact the disadvantages and advantages of
the Alternative Offer may have to individual Proactis Shareholders.
Accordingly, the Proactis Directors cannot form an opinion as to
whether or not the terms of the Alternative Offer are fair and
reasonable and are not making any recommendation to Proactis
Shareholders as to whether or not they should elect for the
Alternative Offer. Alan Aubrey and Rodney Potts have each
irrevocably undertaken to partially elect for the Alternative Offer
(subject to the terms and conditions of the Alternative Offer as
set out in paragraph 13 below and to be set out in the Scheme
Document), in each case in respect of their beneficial holdings of
520,976 Proactis Shares and 3,065,143 Proactis Shares respectively,
representing in aggregate approximately 3.75 per cent. of the
issued ordinary share capital of Proactis on 29 April 2021 (being
the last Business Day prior to the date of this announcement). Each
of Alan Aubrey and Rodney Potts have irrevocably undertaken to
elect for the Cash Offer in respect of the remainder of their
beneficial holdings of Proactis Shares. The remaining Proactis
Directors, being Tim Sykes, Richard Hughes and Nick Brown, have
each irrevocably undertaken to elect for the Cash Offer in respect
of the entirety of their beneficial holdings of Proactis Shares.
Further details of these undertakings, including the circumstances
in which they cease to be binding, are set out in Appendix 3 to
this announcement.
The Proactis Directors consider that, in deciding whether or not
to elect for the Alternative Offer, the Proactis Shareholders
should take their own independent advice and consider carefully the
disadvantages and advantages of electing for the Alternative Offer
(including, but not limited to, those set out below) in light of
their own financial circumstances and investment objectives:
Disadvantages of electing for the Alternative Offer
-- The Alternative Offer Securities will be unlisted and will
not be admitted to trading on any stock exchange and will,
therefore, be illiquid. As a result, any assessment of the value of
the Alternative Offer Securities should take into account an
individual shareholder's assessment of an appropriate liquidity
discount.
-- Upon the Scheme becoming Effective, the Alternative Offer
Securities will not carry any general voting rights at general
meetings of Topco, and will therefore have no influence over
decisions made by Topco in relation to its indirect investment in
Proactis or in any other business.
-- The Alternative Offer Securities will be of uncertain value
and there can be no assurance that they will be capable of being
sold in the future.
-- Proactis Shares are currently quoted on AIM. Certain
standards and protections afforded to shareholders in an AIM quoted
company will be substantially different to a shareholding in an
unquoted private company which an eligible Proactis Shareholder
would receive as a result of electing for the Alternative
Offer.
-- Eligible Proactis Shareholders will have no certainty as to
the amount of Alternative Offer Securities they would receive
because:
o each eligible Proactis Shareholder that elects to accept the
Alternative Offer (whether in whole or in part) will be
automatically deemed to have elected for the Cash Offer for the
first 66,667 Proactis Shares that are subject to such acceptance by
that eligible Proactis Shareholder;
o the maximum number of Alternative Offer Securities available
to Proactis Shareholders under the Alternative Offer will be
limited to the Alternative Offer Maximum; and
o should elections not be made that represent at least 3 per
cent. of the issued ordinary share capital of Topco at completion
of the Acquisition, the Alternative Offer will lapse. In these
circumstances, no Alternative Offer Securities will be issued and
the consideration payable in respect of each Proactis Share will be
settled entirely in cash in accordance with the terms of the Cash
Offer.
Advantages of electing for the Alternative Offer
-- The Alternative Offer allows eligible Proactis Shareholders
to invest indirectly in Bidco, providing continued economic
exposure to Proactis under private ownership.
-- The Alternative Offer allows eligible Proactis Shareholders
to participate in future value creation and may ultimately deliver
greater value than the Cash Offer (although this cannot be
guaranteed).
-- The Alternative Offer Securities will rank economically pari
passu with the Topco Ordinary Shares in issue at the time the
Alternative Offer Securities are allotted and issued, including in
respect of dividends and the return of capital on a winding up.
Eligible Proactis Shareholders should also ascertain whether
acquiring or holding Alternative Offer Securities is affected by
the laws of the relevant jurisdiction in which they reside or of
which they are a citizen and consider whether Alternative Offer
Securities are a suitable investment in light of their own personal
circumstances. Proactis Shareholders are, therefore, strongly
recommended to seek their own independent financial, tax and legal
advice in light of their own particular circumstances and
investment objectives before deciding whether to elect for the
Alternative Offer (whether in respect of part of their holding of
Proactis Shares or otherwise). Any decision to elect for the
Alternative Offer should be based on independent financial, tax and
legal advice and full consideration of this announcement and, to
the extent available in such Proactis Shareholder's jurisdiction,
the Scheme Document (once published).
Further details of the Alternative Offer are set out in
paragraphs 13, 14 and 15 below, and Appendix 4 of this
announcement.
4. Background to and reasons for the Recommendation
Background
Proactis Shares have been quoted on AIM since 2006. Since this
time Proactis has grown significantly, through organic as well as
acquisitive means. In 2017, Proactis acquired Perfect Commerce, LLC
for approximately GBP102 million, of which GBP45 million was
satisfied through new debt facilities. Following that transaction,
Proactis experienced a significant level of customer churn and a
deterioration of the pipeline in its recently acquired French,
German and US spend management businesses. This culminated in a
change in leadership and an operational review, the result of which
was outlined in the Proactis Group's interim results in April 2019.
At that time Proactis announced certain actions that were required
to be taken in order to move those businesses to growth and
therefore to shareholder value creation.
Management detailed a revised strategic plan as a result of the
operational review that was focused on, amongst other areas,
rolling out its go-to-market strategy already deployed in the
United Kingdom and Netherlands, aligning its extensive product
portfolio to optimise cross selling and up selling opportunities,
customer retention and driving growth (through strategic
initiatives such as the deployment of bePayd). Since that time
Proactis has returned to more stable and normalised levels of
customer retention and underlying organic growth.
Future growth
The Proactis Directors remain confident that the ongoing,
successful execution of Proactis' strategy would provide long-term
growth and create significant value for Proactis Shareholders.
However, it is the view of the Proactis Directors that the public
markets no longer afford Proactis the financial flexibility to
enable it to pursue its strategy and unlock its full potential.
Indeed, the Proactis Directors believe that the delivery of
Proactis' growth strategy could be effected more quickly with
access to growth capital, financial flexibility and the ability to
take longer-term investment and strategic decisions, for example
accelerating the single international product and investment into
bePayd, as well as increasing investment in technology and
consolidation of its existing software product suite. Further, the
Proactis Directors believe that the financial and strategic support
of Pollen Street Capital, a leading growth-focused financial
sponsor, will be highly beneficial to Proactis in delivering this
accelerated expansion and longer-term value creation.
The Acquisition
The Proactis Directors believe the Acquisition reflects an
attractive valuation for Proactis. A price per Proactis Share of 75
pence represents a premium of 70.7 per cent. to the volume-weighted
average price of 43.9 pence per Proactis Share for the three-month
period ended on the last Business Day prior to the date of this
announcement. At this level, the Proactis Directors believe that
the Acquisition will provide Proactis Shareholders with the
opportunity to obtain liquidity for their investment and to
crystallise the value of their holdings, which the Proactis
Directors consider may not otherwise be achievable in the
near-term. The Proactis Directors note that Pollen Street Capital,
acting on behalf of investment funds advised and managed by it,
submitted an initial proposal to Proactis of 60 pence per Proactis
Share followed by a second proposal of 70 pence per Proactis Share,
and that the Cash Offer represents a material increase from these
starting and subsequent proposals.
The Proactis Directors believe that the Acquisition will provide
Proactis with enhanced operational flexibility and financial
resilience, enabling it to offer a more attractive proposition to
its customers and potential opportunities for employees through
pursuing its growth strategy.
Bidco has procured irrevocable undertakings from all of the
Proactis Directors and certain Proactis Shareholders to vote (or,
where applicable, procure voting) in favour of the Scheme at the
Court Meeting and the Special Resolutions to be proposed at the
General Meeting (or in the event that the Acquisition is
implemented by an Offer, to accept or procure acceptance of such
Offer) in respect of, in aggregate, 44,995,141 Proactis Shares,
representing approximately 47.10 per cent. of the existing issued
ordinary share capital of Proactis as at 29 April 2021 (being the
last Business Day prior to this announcement).
Having taken into account all relevant factors, the Proactis
Directors believe that the terms of the Acquisition are compelling,
acknowledge the quality and strong prospects of Proactis' business
and deliver attractive value to Proactis Shareholders in cash,
allowing them to crystallise the value of their holdings, as well
as the Alternative Offer Securities, which enable participation by
eligible Proactis Shareholders in future capital and income
returns. As such, the Proactis Directors intend to recommend
unanimously the Cash Offer to Proactis Shareholders.
5. Background to and reasons for the Acquisition
Bidco believes that Proactis has successfully developed a
leading position in the business spend management software market
with a range of solutions offering a compelling value proposition
to its client bases across Europe and North America.
Bidco also considers there to be significant scope for increased
adoption of business spend management solutions as companies
increasingly seek to digitise processes, in particular in the
mid-market where such solutions are currently less highly-adopted
than amongst larger corporates. As a well-established provider with
a footprint in five significant international markets, and a
leading core set of software solutions focused on mid-sized
companies, Bidco believes Proactis has the potential to capitalise
successfully on this trend.
To maximise the market opportunity and become a global market
leader to mid-sized corporates, Bidco believes that Proactis would
benefit from returning to private ownership with the support of a
growth-focused shareholder, who can provide the capital and
longer-term view of value creation to enable the management team to
make the investment in products, sales and marketing, and
infrastructure necessary to capitalise on the market
opportunity.
Pollen Street Capital will provide Proactis and its management
team with the flexibility to take these longer-term decisions to
maximise the growth potential of the business, whilst also
providing strategic support to develop new growth areas and
operational expertise to drive efficiency.
6. Information relating to Bidco, Topco, Parentco and Pollen Street Capital
Bidco
Bidco is a limited company registered in England and Wales and
incorporated on 20 April 2021. Bidco was formed for the purposes of
the Acquisition and is a wholly-owned indirect subsidiary of
investment funds advised and managed by Pollen Street Capital.
Bidco has not traded since its date of incorporation, nor has it
entered into any obligations other than in connection with the
Acquisition.
Topco
Topco is a limited company registered in England and Wales and
incorporated on 16 April 2021. Topco was formed for the purposes of
the Acquisition. Topco is a wholly-owned direct subsidiary of
Parentco and is a wholly-owned indirect subsidiary of investment
funds advised and managed by Pollen Street Capital. Bidco is a
wholly-owned direct subsidiary of Topco. Topco has not traded since
its date of incorporation, nor has it entered into any obligations
other than in connection with the Acquisition.
Parentco
Parentco is a limited company registered in England and Wales
and incorporated on 12 April 2021. Parentco was formed for the
purposes of the Acquisition. Parentco is a wholly-owned direct
subsidiary of investment funds advised and managed by Pollen Street
Capital. Topco is a wholly-owned direct subsidiary of Parentco.
Parentco has not traded since its date of incorporation, nor has it
entered into any obligations other than in connection with the
Acquisition.
Pollen Street Capital
Pollen Street Capital is one of Europe's leading specialist
private equity investors in the financial and business services
sectors, having invested over GBP2 billion since 2003 in a range of
businesses across all stages of development. Pollen Street Capital
works with entrepreneurial management teams to build businesses
that deliver market-leading products and services to their
customers, in order to create long-term sustainable success.
7. Information relating to Proactis
Proactis is an international business spend management solution
provider operating with a market-facing presence in the United
Kingdom, United States, France, Germany and the Netherlands.
Proactis enables digital trade, by helping organisations around the
world to control 100 per cent. of their spend. Proactis works with
its customers to transform their Source-to-Pay processes; to help
them save money and create efficiency gains while increasing
compliance and reducing risk. Proactis believes its solutions are
used in approximately 1,100 buying organisations around the world,
with over three million users who have over two million supplier
relationships, in over 100 countries across the commercial, public
and not-for-profit sectors.
Proactis was incorporated in 2006 and shortly thereafter the
Proactis Shares were admitted to trading on AIM. In the financial
year ended 31 July 2020 (audited), the business generated GBP49.6
million of revenue and adjusted EBITDA of GBP11.8 million, and
reported GBP41.2 million of annual recurring revenue. For the half
year ended 31 January 2021 (unaudited), the business generated
GBP23.8 million of revenue and adjusted EBITDA of GBP6.2 million,
and reported GBP40.8 million of annual recurring revenue.
8. Irrevocable Undertakings
In total, Bidco has procured irrevocable undertakings to vote
(or, where applicable, procure voting) in favour of the Scheme at
the Court Meeting and the Special Resolutions to be proposed at the
General Meeting (or in the event that the Acquisition is
implemented by an Offer, to accept or procure acceptance of such
Offer) in respect of, in aggregate, 44,995,141 Proactis Shares,
representing approximately 47.10 per cent. of the existing issued
ordinary share capital of Proactis as at 29 April 2021 (being the
last Business Day prior to this announcement).
The Proactis Directors have irrevocably undertaken to vote (or,
where applicable, procure voting) in favour of the Scheme at the
Court Meeting and the Special Resolutions to be proposed at the
General Meeting (or in the event that the Acquisition is
implemented by an Offer, to accept or procure acceptance of such
Offer) in respect of their own beneficial holdings totalling
10,823,504 Proactis Shares in aggregate, representing approximately
11.33 per cent. of the existing issued ordinary share capital of
Proactis as at 29 April 2021 (being the last Business Day prior to
the date of this announcement).
As part of the irrevocable undertakings from the Proactis
Directors described above, Bidco has received irrevocable
undertakings from:
-- each of Alan Aubrey and Rodney Potts to partially elect for:
(i) the Alternative Offer (subject to the terms and conditions of
the Alternative Offer as set out in paragraph 13 below and to be
set out in the Scheme Document), in each case in respect of their
beneficial holdings of 520,976 Proactis Shares and 3,065,143
Proactis Shares respectively, representing in aggregate
approximately 3.75 per cent. of the existing issued ordinary share
capital of Proactis as at 29 April 2021 (being the last Business
Day prior to the date of this announcement); and (ii) the Cash
Offer in respect of the remainder of their beneficial holdings;
and
-- each of Richard Hughes, Tim Sykes and Nick Brown to elect for
the Cash Offer (subject to the terms and conditions of the Cash
Offer set out in this announcement and to be set out in the Scheme
Document) in respect of their entire beneficial holdings of
Proactis Shares, representing, together with the Proactis Shares in
respect of which Alan Aubrey and Rodney Potts have irrevocably
undertaken to elect for the Cash Offer, in aggregate approximately
7.58 per cent. of the existing issued ordinary share capital of
Proactis as at 29 April 2021 (being the last Business Day prior to
the date of this announcement).
These hard irrevocable undertakings cease to be binding: (i)
where the Acquisition is implemented by way of a Scheme, if the
Scheme Document is not published within 28 days of the date of
issue of this announcement (or such later date as may be agreed
between Proactis, Bidco and the Panel) in circumstances where the
same is caused by a breach by Bidco of clause 5 of the Co-operation
Agreement; (ii) if the Co-operation Agreement is terminated in
accordance with its terms; (iii) if Bidco announces that it does
not intend to proceed with the Acquisition and no new revised or
replacement Scheme or Offer is announced by Bidco in accordance
with Rule 2.7 of the Takeover Code at the same time; or (iv) on the
earlier of: (A) the Long Stop Date; and (B) the date on which the
Acquisition (whether implemented by way of a Scheme or an Offer) is
withdrawn or lapses in accordance with its terms, except where such
withdrawal or lapse is as a result of Bidco exercising its right to
implement the Acquisition by way of an Offer rather than a Scheme
or vice versa in accordance with the Takeover Code. The
undertakings of the Proactis Directors will remain binding in the
event that a higher competing offer for Proactis is made.
In addition to the irrevocable undertakings from Proactis
Directors described above, Bidco has also received irrevocable
undertakings to vote (or, where applicable, procure voting) in
favour of the Scheme at the Court Meeting and the Special
Resolutions to be proposed at the General Meeting (or in the event
that the Acquisition is implemented by an Offer, to accept or
procure acceptance of such Offer) from Lombard Odier Asset
Management (Europe) Limited and Gresham House Asset Management
Limited in respect of 28,066,683 and 6,104,954 Proactis Shares,
representing in aggregate approximately 35.77 per cent. of the
existing issued ordinary share capital of Proactis as at 29 April
2021 (being the last Business Day prior to the date of this
announcement).
These irrevocable undertakings cease to be binding, inter alia,
on the earlier of the Long Stop Date and the date on which the
Acquisition (whether implemented by way of a Scheme or an Offer) is
withdrawn or lapses in accordance with its terms, save where such
lapse or withdrawal is as a result of Bidco exercising its right to
implement the Acquisition by way of an Offer rather than by way of
a Scheme or vice versa in accordance with the Takeover Code.
The irrevocable undertaking provided by Gresham House Asset
Management Limited will also cease to be binding if any third party
announces a firm intention offer in accordance with Rule 2.7 of the
Takeover Code for all of the issued and to be issued ordinary share
capital of Proactis and the consideration payable for each Proactis
Share under such proposal represents in the reasonable opinion of
Bidco a premium of 10 per cent. or greater to the value of the
consideration offered by Bidco and Bidco does not, within ten days
of such third party announcement, announce an increase to the
consideration to be paid for the Proactis Shares to at least an
equivalent amount per Proactis Share as being offered under the
competing proposal.
The irrevocable undertaking provided by Lombard Odier Asset
Management (Europe) Limited will also cease to be binding if any
third party announces a firm intention offer in accordance with
Rule 2.7 of the Takeover Code for all of the issued and to be
issued ordinary share capital of Proactis and the consideration
payable for each Proactis Share under such proposal represents a
premium of 10 per cent. or greater to the value of the
consideration offered by Bidco.
Further details of these irrevocable undertakings (including the
circumstances in which they cease to be binding) are set out in
Appendix 3 to this announcement.
9. Financing of the Acquisition
The cash consideration payable to Proactis Shareholders by Bidco
pursuant to the terms of the Acquisition will be financed by equity
to be invested by the PSC Funds. In connection with the financing
of Bidco, the PSC Funds have entered into the Equity Commitment
Letter.
Houlihan Lokey, in its capacity as financial adviser to Bidco,
is satisfied that sufficient resources are available to Bidco to
satisfy in full the cash consideration payable to Proactis
Shareholders pursuant to the terms of the Acquisition.
HSBC, the lender under the Proactis Group's main facility
agreement and a second facility agreement under which Proactis
Accelerated Payments Limited, a Proactis Group entity, is borrower,
has agreed to waive the change of control clause contained in each
facility agreement, which would otherwise be triggered on the
Effective Date, and to extend the term of the main facility from 7
July 2022 to 31 July 2024. The waiver is subject to certain
terms.
Further information on the financing of the Acquisition will be
set out in the Scheme Document.
10. Offer-related Arrangements
10.1 Confidentiality Agreement
Pollen Street Capital, in its capacity as investment manager for
and on behalf of funds managed or advised by it, and Proactis have
entered into a confidentiality agreement dated 30 November 2020
(the "Confidentiality Agreement"), pursuant to which each party has
undertaken, amongst other things, to: (i) keep confidential
information relating to the proposed Acquisition and not to
disclose it to third parties (other than certain permitted parties)
unless required by law, by a court or authority of competent
jurisdiction or by the rules of, or at the request of, any
applicable governmental or regulatory organisation (including the
Takeover Code and the Panel) or any relevant stock exchange
(including AIM); and (ii) use the confidential information only for
the purpose of evaluation and negotiating the terms of the
Acquisition. These confidentiality obligations will remain in force
until 30 November 2022.
10.2 Co-operation Agreement
Bidco and Proactis have entered into a co-operation agreement
dated 30 April 2021 (the "Co-operation Agreement"), pursuant to
which Bidco and Proactis have, amongst other things, agreed to
cooperate in relation to obtaining any approvals, consents,
clearances, permissions, confirmations, comfort letters and waivers
as may be necessary, and the making of all filings as may be
necessary, from or under the law, regulations or practices applied
by any applicable regulatory authority in connection with the
Acquisition. In addition, Bidco has agreed to provide Proactis with
certain information for the purposes of the Scheme Document and
otherwise to provide assistance which may reasonably be required
with the preparation of the Scheme Document. The Co-operation
Agreement also includes provisions relating to the right of Bidco
to implement the Acquisition by way of an Offer and provisions that
will apply in respect of the Proactis Share Plans.
Bidco has the right to terminate the Co-operation Agreement
where, inter alia:
a) a competing proposal becomes effective or is recommended by the Proactis Directors;
b) the Proactis Directors have withdrawn, qualified, modified or
failed to provide their unanimous and unconditional recommendation
that the Proactis Shareholders vote in favour of the Scheme at the
Court Meeting and the Special Resolutions at the General Meeting
(including, prior to the publication of the Scheme Document (or the
Offer Document, as the case may be) their intention to do so);
c) the Scheme Document is not posted by the date that is 28 days
from the date of this announcement (and such failure is not as a
result of Bidco's breach of its obligations to provide reasonable
assistance with the preparation of the Scheme Document or because a
later date for despatch of the Scheme Document has been agreed
between the parties with the Panel's consent);
d) the Court Meeting, the General Meeting and/or the Scheme
Court Hearing is not held on or before the 22(nd) day after the
expected date of such meeting and/or hearing; and
e) Bidco has notified Proactis of a Condition which is incapable
of satisfaction or waiver by the Long Stop Date (where its
invocation is permitted by the Panel).
Proactis has the right to terminate the Co-operation Agreement
where a competing proposal completes, becomes effective or is
declared unconditional in all respects.
Bidco and Proactis may also terminate the Co-operation Agreement
by service of written notice on the other if the Acquisition is
implemented by way of the Scheme and:
a) the Scheme is not approved by the requisite majority of
Proactis Shareholders at the Court Meeting or the Special
Resolutions are not passed by the requisite majority of Proactis
Shareholders at the General Meeting; or
b) the Court refuses to sanction the Scheme or grant the Scheme
Court Order at the Scheme Court Hearing.
The Co-operation Agreement will also terminate if:
a) the Acquisition is withdrawn, terminates or lapses in
accordance with its terms, other than where such lapse or
withdrawal: (i) is as a result of Bidco exercising its right to
implement the Acquisition as an Offer (with the consent of the
Panel and subject to the approval of Proactis (or otherwise in
accordance with the Co-operation Agreement); or (ii) is followed by
a firm intention announcement made, within five Business Days of
such lapse or withdrawal, by Bidco or a person acting in concert
with Bidco to implement the Acquisition by a different offer or
scheme on substantially the same or improved terms; or
b) the Scheme (or Offer, as the case may be) has not become Effective by the Long Stop Date.
Bidco and Proactis may also terminate the Co-operation Agreement
by mutual consent.
Remuneration Disclosure
In consideration and recognition of the additional work carried
out in connection with the Acquisition (above and beyond their
normal duties and responsibilities), the Proactis Directors have
agreed to pay a cash bonus to Tim Sykes and Richard Hughes of
GBP150,000 and GBP150,000 (respectively), payable after the
Effective Date as part of the next practicable payroll. Bidco has
consented to the executive director bonuses and acknowledges these
under the Co-operation Agreement.
finnCap considers that the proposed cash bonus arrangements, as
set out above, are fair and reasonable. In providing this advice,
finnCap has taken into account the commercial assessments of the
Proactis Directors (other than Tim Sykes and Richard Hughes).
The proposed cash bonus payments in respect of Tim Sykes and
Richard Hughes are related party transactions under the AIM Rules.
The Proactis Directors (other than Tim Sykes and Richard Hughes)
having consulted with finnCap, consider the terms of the related
party transaction to be fair and reasonable insofar as Proactis
Shareholders are concerned.
11. Disclosure of Interests in Proactis
Except for the irrevocable commitments referred to in paragraph
8 above, as at close of business on 29 April 2021 (being the last
Business Day prior to the date of this announcement) neither Bidco,
nor any of its directors, nor, so far as Bidco is aware, any person
acting in concert (within the meaning of the Takeover Code) with
Bidco has:
a) any interest in, or right to subscribe for, any relevant securities of Proactis;
b) any short positions in respect of relevant securities of
Proactis (whether conditional or absolute and whether in the money
or otherwise), including any short position under a derivative, any
agreement to sell or any delivery obligation or right to require
another person to purchase or take delivery;
c) any dealing arrangement of the kind referred to in Note 11 on
the definition of acting in concert in the Takeover Code in
relation to Proactis Shares or in relation to any securities
convertible or exchangeable into Proactis Shares; nor
d) borrowed or lent any relevant securities of Proactis
(including, for these purposes, any financial collateral
arrangements of the kind referred to in Note 4 on Rule 4.6 of the
Takeover Code) save for any borrowed shares which have been either
on-lent or resold.
'Interests in securities' for these purposes arise, in summary,
when a person has long economic exposure, whether absolute or
conditional, to changes in the price of securities (and a person
who only has a short position in securities is not treated as
interested in those securities). In particular, a person will be
treated as having an 'interest' by virtue of the ownership, voting
rights or control of securities, or by virtue of any agreement to
purchase, option in respect of, or derivative referenced to
securities.
It has not been possible for Bidco to make enquiries of all of
its concert parties in advance of release of this announcement.
Therefore, if Bidco becomes aware, following the making of such
enquiries, that any of its concert parties have any such interests
in relevant securities of Proactis, details in respect of that will
be included in Bidco's Opening Position Disclosure in accordance
with Rule 8.1(a) and Note 2(a)(i) to Rule 8 of the Takeover
Code.
12. Strategic plans with regard to the business, directors,
management, employees, pensions and locations of the Proactis
Group
12.1 Bidco's strategic plans for Proactis
As set out in paragraph 5, Bidco believes that Proactis
management has put in place a strategy to create a high-quality,
differentiated player in the business spend management software
market, which has the potential to capitalise on the trend of
increasing adoption rates across its markets to deliver long-term
growth.
However, in order to maximise this opportunity and become a
global leader in its market, Bidco believes that Proactis would
benefit from returning to private ownership where the management
team will have the flexibility and capital to be able to make
long-term decisions to invest in products, sales and marketing, and
infrastructure without the constraints of public markets.
Prior to this announcement and consistent with market practice,
Bidco has been granted access to Proactis' senior management for
the purposes of confirmatory due diligence.
Following the Acquisition becoming Effective, Bidco intends to
support Proactis' management to undertake a detailed evaluation of
the Proactis Group and assess how best to maximise the potential of
the Proactis Group. Bidco expects that this evaluation will be
completed within approximately six months from the Effective Date.
While the parameters of this evaluation have not yet been
finalised, it is expected to focus on identifying new opportunities
and potential investment that will support, accelerate and optimise
Proactis' strategy to grow revenues, profitability and shareholder
value through efficiently and consistently delivering high-quality,
high-ROI products and services across each of its target markets.
Such potential opportunities or investment areas may include, for
example, augmenting Proactis' routes to market and product
capabilities, exploring potential new markets or target client
segments, and other ideas to be developed between Bidco and
management.
12.2 Employees and management
Bidco values the knowledge, expertise and ambitions of Proactis'
existing management and employees and recognises the important
contribution that the management team and employees of Proactis
have made to the success of the business.
Once Proactis ceases to be a quoted company, a limited number of
quoted company-related functions may be reduced in scope or become
unnecessary. This may lead to a non-material reduction in the
headcount of Proactis.
Other than as part of the reduction in quoted company-related
functions described above, Bidco expects the existing personnel of
Proactis to continue to contribute to the business following
completion of the Acquisition, and does not intend to initiate any
material headcount reductions within the Proactis Group as a result
of the Acquisition.
12.3 Existing rights and pensions
Bidco confirms that, following the Scheme becoming Effective,
the existing contractual and statutory employment rights, including
in relation to pensions, of all Proactis management and employees
will be fully safeguarded in accordance with applicable law. Bidco
does not intend to make any material change to the conditions of
employment of the employees of the Proactis Group.
In the United Kingdom, Proactis operates a defined contribution
pension scheme for its employees. It also operates other pension
arrangements in certain other jurisdictions in which it has
employees. Proactis does not offer any defined benefit pension
arrangements. Bidco does not intend to make any changes to
Proactis' current pension arrangements, employer pension
contributions or the rights of admission of new members.
12.4 Incentivisation arrangements
Following the Scheme becoming Effective, Bidco intends to review
the management, governance and incentive structure of the Proactis
Group. Bidco has not entered into, and has not had any discussions
on proposals to enter into, any form of incentivisation or other
arrangements with members of the Proactis Group's management or
employees and no such discussions will take place prior to the
Scheme becoming Effective.
12.5 Headquarters, locations, fixed assets and research and development
Following the Scheme becoming Effective, Bidco has no plans to
undertake any material restructurings or changes in the locations
of Proactis' places of business. Save as set out in paragraph 12.2
above, Bidco has no plans to change the location or functions of
Proactis' headquarters in Wetherby.
No changes are envisaged with respect to the redeployment of
Proactis' fixed asset base nor its research and development
function.
12.6 Trading facilities
Proactis Shares are currently admitted to trading on AIM. As set
out in paragraph 21, it is intended that a request will be made to
the London Stock Exchange to cancel trading in Proactis Shares on
AIM, and to re-register Proactis as a private limited company, to
take effect on or shortly after the Effective Date.
None of the statements in this paragraph 12 are "post-offer
undertakings" for the purposes of Rule 19.5 of the Takeover
Code.
13. The Alternative Offer
As an alternative to the Cash Offer, eligible Proactis
Shareholders may elect to receive 0.75 Alternative Offer Securities
in the capital of Topco in exchange for each Proactis Share (the
"Alternative Offer"), subject to the terms and conditions of the
Alternative Offer (described in further detail below). An eligible
Proactis Shareholder may elect to take up the Alternative Offer in
respect of all or part of their holding of Proactis Shares.
The fractional entitlements of each eligible Proactis
Shareholder to Alternative Offer Securities under the Alternative
Offer will be rounded down to the nearest whole number of
Alternative Offer Securities per eligible Proactis Shareholder.
Fractional entitlements to Alternative Offer Securities will not be
allotted or issued to such eligible Proactis Shareholder but will
be disregarded.
Each eligible Proactis Shareholder that elects to accept the
Alternative Offer (whether in whole or in part) will be
automatically deemed to have elected for the Cash Offer for the
first 66,667 Proactis Shares that are subject to such acceptance by
that Proactis Shareholder (the "AO Cash Threshold"). Each such
eligible Proactis Shareholder will then receive Alternative Offer
Securities (subject to the terms and conditions of the Alternative
Offer) for any Proactis Shares in excess of the AO Cash Threshold
that are subject to the acceptance by that eligible Proactis
Shareholder of the Alternative Offer.
The maximum number of Alternative Offer Securities available to
eligible Proactis Shareholders under the Alternative Offer will be
limited to a number which represents 24.9 per cent. of the issued
ordinary share capital of Topco at completion of the Acquisition
(the "Alternative Offer Maximum").
If elections are validly received from eligible Proactis
Shareholders in respect of a number of Proactis Shares that would
require the issue of Alternative Offer Securities exceeding the
Alternative Offer Maximum, such elections will be unable to be
satisfied in full. In these circumstances the number of Alternative
Offer Securities to be issued in respect of each Proactis Share
will be reduced on a pro rata basis, and the balance of the
consideration for each Proactis Share will be paid in cash in
accordance with the terms of the Cash Offer.
The availability of the Alternative Offer is conditional upon
valid elections being made for such number of Alternative Offer
Securities as represent at least 3 per cent. of the issued ordinary
share capital of Topco at completion of the Acquisition, failing
which it will lapse. In these circumstances, no Alternative Offer
Securities will be issued and the consideration payable in respect
of each Proactis Share will be settled entirely in cash in
accordance with the terms of the Cash Offer.
Unless otherwise determined by Bidco and permitted by applicable
law and regulation, the Alternative Offer will not be made, and the
Alternative Offer Securities will not be offered, sold or
delivered, directly or indirectly, in or into any Restricted
Jurisdiction and individual acceptances of the Alternative Offer
will only be valid if all regulatory approvals (if any) required by
a Proactis Shareholder to acquire the Alternative Offer Securities
have been obtained.
For the purposes of Rule 24.11 of the Takeover Code, Houlihan
Lokey, as financial advisers to Bidco, will provide an estimate of
the value of an Alternative Offer Security, together with the
assumptions, qualifications and caveats forming the basis of its
estimate of value, in a letter to be included in the Scheme
Document.
If the Scheme becomes Effective, Proactis Shareholders who do
not validly elect to receive their consideration by means of the
Alternative Offer will automatically receive the full amount of the
Cash Offer for their entire holding of Proactis Shares.
If the Scheme becomes Effective, eligible Proactis Shareholders
that validly elect to receive consideration by means of the
Alternative Offer will receive their Alternative Offer Securities
pursuant to a roll-over mechanism in the Scheme whereby on or
shortly after the Effective Date:
-- First exchange - firstly, the Proactis Shares that are
subject to valid elections of eligible Proactis Shareholders to
receive consideration by means of the Alternative Offer will be
exchanged for shares or loan notes to be issued by Bidco (the
"Bidco Securities");
-- Second exchange - secondly, and immediately following the
first exchange, the Bidco Securities will be exchanged for the
relevant number of Alternative Offer Securities to which eligible
Proactis Shareholders are entitled in accordance with the
Alternative Offer,
(the "Rollover").
14. Summary of the Alternative Offer Securities
Certain details of the Alternative Offer Securities are set out
in Appendix 4 to this announcement. Further information about the
Alternative Offer Securities and the full terms and conditions of
the Alternative Offer, including the eligibility of Proactis
Shareholders to elect for the Alternative Offer, will be included
in the Scheme Document.
As an overview, the Alternative Offer Securities will be subject
to the following terms and conditions:
-- the Alternative Offer Securities will not carry any general
voting rights at general meetings of Topco;
-- the Alternative Offer Securities will be non-transferrable (subject to limited exceptions);
-- the Alternative Offer Securities will be unquoted;
-- eligible Proactis Shareholders who validly elect to receive
all of their consideration by means of the Alternative Offer will,
pursuant to a power of attorney to be included in the Scheme
Document, deliver a fully executed deed of adherence pursuant to
which they will be bound by the Topco Shareholders' Agreement;
-- Parentco will have a right to "drag along" (i.e. force the
sale of) up to all Alternative Offer Securities on any transfers of
direct or indirect shareholdings in securities of Topco by
Parentco, and on the same economic terms, to a bona fide third
party purchaser if, following such transfer, the purchaser would
thereafter directly or indirectly hold a majority of the ordinary
share capital of Topco. Parentco will also have customary drag
rights in connection with a proposed IPO of Topco or any newly
incorporated company established in connection with such IPO;
-- a holder of Alternative Offer Securities will be entitled to
pro-rata tag-along rights on any transfer of direct or indirect
shareholdings in securities of Topco by Parentco, and on the same
economic terms, to a bona fide third party purchaser if, following
such transfer, the purchaser would thereafter directly or
indirectly hold a majority of the ordinary share capital of Topco;
and
-- if and for so long as the Alternative Offer Securities amount
to at least 15 per cent. of the issued ordinary share capital of
Topco, the holders of the Alternative Offer Securities may appoint
one director to the board of Topco.
15. Risk factors and other investment considerations
The attention of eligible Proactis Shareholders who may consider
electing to receive their consideration by means of the Alternative
Offer is drawn to certain risk factors and other investment
considerations relevant to such an election. These will be set out
in full in the Scheme Document but will include, inter alia, the
following:
-- upon the Scheme becoming Effective, Topco and its
subsidiaries will be controlled by Parentco and the Alternative
Offer Securities will not carry any general voting rights at
general meetings of Topco;
-- the Alternative Offer Securities will comprise securities in
a private and unquoted company, and there is no current expectation
that they will be listed or admitted to trading on any exchange or
market for the trading of securities, and will therefore be
illiquid;
-- the value of the Alternative Offer Securities will at all
times be uncertain and there can be no assurance that any such
securities will be capable of being sold in the future or that they
will be capable of being sold at the value to be estimated by
Houlihan Lokey in the Scheme Document;
-- payments in respect of Alternative Offer Securities will not
be guaranteed or secured and, it is not anticipated that Topco will
declare or pay any dividends on any of the Alternative Offer
Securities in the near-term;
-- the Alternative Offer Securities will be non-transferrable (subject to limited exceptions);
-- the holders of Alternative Offer Securities will not enjoy
any minority protections or other rights save for those rights
prescribed by applicable law;
-- the holders of Alternative Offer Securities may be required
in the future to sell their Alternative Offer Securities under the
terms of a "drag along" provision; and
-- the holders of Alternative Offer Securities will not be
afforded the same level of protections and disclosure of
information that they currently benefit from as shareholders in
Proactis as an AIM quoted company.
16. Proactis Share Plans
Participants in the Proactis Share Plans will be contacted
regarding the effect of the Acquisition on their rights under the
Proactis Share Plans and an appropriate proposal will be made to
such participants pursuant to Rule 15 of the Takeover Code in due
course.
17. Convertible Loan Notes
Holders of the Convertible Loan Notes will be contacted
regarding the effect of the Acquisition on their rights under the
Convertible Loan Notes and an appropriate proposal will be made to
such holders pursuant to Rule 15 of the Takeover Code in due
course.
18. Proactis SA
Proactis currently indirectly holds approximately 88 per cent.
of the issued share capital of Proactis SA, the shares of which are
listed on Euronext Paris. Upon the Acquisition becoming Effective,
Bidco will become the indirect holder of more than 30 per cent. of
the share capital and voting rights of Proactis SA. As such,
pursuant to the rules of the AMF, Bidco will be obliged to make a
tender offer for those Proactis SA shares that it does not already
indirectly hold unless the AMF grants a waiver of the application
of such rules to Bidco. Bidco intends to seek such a waiver from
the AMF.
19. Opening Position Disclosure
In connection with the Acquisition, Bidco will make a public
Opening Position Disclosure setting out details of its interests or
short positions in, or rights to subscribe for, any relevant
securities of Proactis by no later than 12 noon on 17 May 2021.
20. The Scheme
It is intended that the Acquisition will be effected by means of
the Scheme between Proactis and the Scheme Shareholders (although
Bidco reserves the right to implement the Acquisition by way of the
Offer, with the consent of the Panel and subject to the terms of
the Co-operation Agreement).
The purpose of the Scheme is to provide for Bidco to become
owner of the whole of the issued and to be issued share capital of
Proactis. This is to be achieved by the transfer of the Scheme
Shares held by Scheme Shareholders to Bidco, in consideration for
which the Scheme Shareholders will receive the consideration on the
basis set out in paragraph 2 of this announcement.
To become Effective, the Scheme must be approved at the Court
Meeting by a majority in number of the Scheme Shareholders (or the
relevant class or classes thereof, if applicable) who are on the
register of members of Proactis at the Scheme Voting Record Time
present and voting (and entitled to vote), whether in person or by
proxy, representing at least 75 per cent. of the votes attached to
the Scheme Shares cast by those Scheme Shareholders (or the
relevant class or classes thereof, if applicable). The Scheme also
requires the passing at the General Meeting of the Special
Resolutions. The General Meeting is expected to be held immediately
after the Court Meeting. Following the Meetings, the Scheme must be
sanctioned by the Court. Finally, a copy of the Scheme Court Order
must be delivered to the Registrar of Companies for registration,
upon which the Scheme will become Effective.
The Scheme will also be subject to the Conditions and further
terms set out in Appendix 1 to this announcement and to the full
terms and conditions to be set out in the Scheme Document.
The Scheme Document will include full details of the Scheme,
together with the notices convening the Court Meeting and the
General Meeting. The Scheme Document will also contain the expected
timetable for the Acquisition, and will specify the necessary
actions to be taken by Proactis Shareholders. Subject to
restrictions in respect of Restricted Jurisdictions, the Scheme
Document will be sent to Proactis Shareholders and, for information
only, to persons with information rights and holders of options
and/or awards granted under the Proactis Share Plans, as soon as
reasonably practicable, and in any event (save with the consent of
the Panel), within 28 days of this announcement.
The Scheme is expected to become Effective during Q3 of the
calendar year 2021, subject to the satisfaction or (where
applicable) waiver of the Conditions. If the Scheme does not become
Effective on or before the Long Stop Date, it will lapse and the
Acquisition will not proceed (unless Bidco and Proactis otherwise
agree and the Panel otherwise consents).
If any Condition in paragraph 2 of Appendix 1 to this
announcement is not capable of being satisfied by the date
specified therein, Bidco shall make an announcement through a
Regulatory Information Service as soon as practicable and, in any
event, by not later than 7.00 a.m. (London time) on the Business
Day following the date so specified, stating whether Bidco has
invoked that Condition, (where applicable) waived that Condition
or, with the agreement of Proactis, specified a new date by which
that Condition must be satisfied.
Upon the Scheme becoming Effective: (i) it will be binding on
all Proactis Shareholders, irrespective of whether or not they
attended or voted at the Meetings (and if they attended and voted,
whether or not they voted in favour); and (ii) share certificates
in respect of Proactis Shares will cease to be valid and
entitlements to Proactis Shares held within the CREST system will
be cancelled. The consideration for the Acquisition (pursuant to
the Cash Offer or the Alternative Offer, as applicable) will be
dispatched to Proactis Shareholders no later than 14 days after the
Effective Date.
Any Proactis Shares issued before the Scheme Record Time will be
subject to the terms of the Scheme. The Special Resolutions to be
proposed at the General Meeting will, amongst other matters,
provide that the Proactis' articles of association be amended to
incorporate provisions requiring any Proactis Shares issued after
the Scheme Record Time (other than to Bidco and/or their nominees)
to be automatically transferred to Bidco (and, where applicable,
for consideration to be paid to the original recipient of the
Proactis Shares so issued) on the same terms as the Acquisition
(other than terms as to timings and formalities). The provisions of
the Proactis' articles of association (as amended) will avoid any
person (other than Bidco and their nominees) holding shares in the
capital of Proactis after the Effective Date.
Bidco reserves the right to elect to implement the Acquisition
by way of an Offer as an alternative to the Scheme (subject to the
Panel's consent and the terms of the Co-operation Agreement). In
such event, the Acquisition will be implemented on substantially
the same terms, so far as applicable, as those which would apply to
the Scheme, subject to appropriate amendments to reflect, among
other things, the change in method of effecting the Acquisition
(including, without limitation: (i) the inclusion of an acceptance
condition set at 75 per cent. of the Proactis Shares to which such
Offer relates (or such other percentage as Bidco may, subject to
the rules of the Takeover Code and the terms of the Co-operation
Agreement and with the consent of the Panel, decide); and (ii)
those required by, or deemed appropriate by, Bidco under applicable
law, including US securities law. Further, if sufficient
acceptances of such Offer are received and/or sufficient Proactis
Shares are otherwise acquired, it is the intention of Bidco to
apply the provisions of the Companies Act 2006 to acquire
compulsorily any outstanding Proactis Shares to which such Offer
relates.
The Scheme will be governed by English law and will be subject
to the jurisdiction of the Court. The Scheme will be subject to the
applicable requirements of the Takeover Code, the Panel, the London
Stock Exchange, the FCA, AIM Rules and the Registrar of
Companies.
21. Cancellation of trading and re-registration
Proactis Shares are currently admitted to trading on AIM. It is
intended that a request will be made to the London Stock Exchange
to cancel trading in Proactis Shares on AIM, and to re-register it
as a private limited company, to take effect on or shortly after
the Effective Date.
It is expected that the last day of dealings in Proactis Shares
on AIM will be the date of the Scheme Court Hearing and that no
transfers will be registered after 6.00 p.m. (London time) on that
date.
22. Consents
Each of finnCap and Houlihan Lokey has given and not withdrawn
its consent to the publication of this announcement with the
inclusion herein of the references to its name in the form and
context in which such references appear.
23. Documents available for inspection
Copies of the following documents will by no later than 12 noon
on the first Business Day following the date of this announcement
be published on Bidco's website at https://cafe.pollencap.com and
Proactis' website at https://www.proactis.com/uk/investors/ until
the end of the offer:
-- this announcement;
-- the Confidentiality Agreement
-- the Co-operation Agreement;
-- the Equity Commitment Letter;
-- the irrevocable undertakings listed in Appendix 3 to this announcement; and
-- the consent letters from each of the financial advisers referred to in paragraph 22 above.
The contents of the websites referred to in this announcement
are not incorporated into and do not form part of this
announcement.
24. General
The Acquisition will be made on the terms and subject to the
Conditions set out in Appendix 1 to this announcement, and to the
full terms and conditions to be set out in the Scheme Document. The
formal Scheme Document comprising the Cash Offer and Alternative
Offer to Proactis Shareholders will be sent to Proactis
Shareholders within 28 days of this announcement (or on such later
date as may be agreed between Bidco and Proactis with the consent
of the Panel). The sources and bases of calculation of certain
information contained in this announcement are set out in Appendix
2 to this announcement. Details of irrevocable undertakings
received by Bidco are set out in Appendix 3 to this announcement.
Certain details of the Alternative Offer Securities are set out in
Appendix 4 to this announcement. Certain terms used in this
announcement are defined in Appendix 5 to this announcement.
Enquiries:
Houlihan Lokey +44 (0)20 7907 4200
(Financial Adviser to Bidco)
Lawrence Guthrie
Mark Fisher
Yashin Mody
Stand Agency
(Communications adviser to Pollen Street Capital)
Cait Dacey +44 (0) 7973 596 503
Proactis +44 (0)19 3754 5070
Tim Sykes
Richard Hughes
finnCap +44 (0)20 7220 0500
(Financial Adviser to Proactis)
Carl Holmes
Henrik Persson
Emily Watts
Slaughter and May is acting as legal adviser to Bidco.
Walker Morris LLP is acting as legal adviser to Proactis.
Important notices relating to financial advisers
Houlihan Lokey, which is authorised and regulated by the FCA in
the United Kingdom, is acting exclusively as financial adviser to
Bidco and no one else in connection with the matters described in
this announcement and will not be responsible to anyone other than
Bidco for providing the protections afforded to clients of Houlihan
Lokey or for providing advice in relation to the Acquisition or any
other matters referred to in this announcement. Neither Houlihan
Lokey nor any of its subsidiaries or affiliates owes or accepts any
duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Houlihan Lokey in connection
with this announcement or any matter referred to in this
announcement.
finnCap Ltd, which is authorised and regulated by the FCA in the
United Kingdom, is acting exclusively for Proactis as financial
adviser and no one else in connection with the Acquisition and will
not be responsible to anyone other than Proactis for providing the
protections afforded to clients of finnCap or for providing advice
in relation to the Acquisition or any other matters referred to in
this announcement. Neither finnCap nor any of its subsidiaries,
affiliates or branches owes or accepts any duty, liability or
responsibility whatsoever (whether direct, indirect, consequential,
whether in contract, in tort, under statute or otherwise) to any
person who is not a client of finnCap in connection with this
announcement, any statement contained herein or otherwise.
Further information
This announcement is for information purposes only and is not
intended to, and does not, constitute or form part of any offer or
inducement to sell or an invitation to purchase, otherwise acquire,
subscribe for, sell or otherwise dispose of, any securities or the
solicitation of an offer to buy any securities, any vote or
approval in any jurisdiction pursuant to the Acquisition or
otherwise. The Acquisition will be made solely pursuant to the
terms of the Scheme Document (or, if the Acquisition is implemented
by way of an Offer, the Offer Document), which will contain the
full terms and conditions of the Acquisition, including details of
what action is required from Proactis Shareholders in respect of
the Acquisition. Any decision in respect of, or other response to,
the Acquisition should be made only on the basis of the information
in the Scheme Document (or, if the Acquisition is implemented by
way of an Offer, the Offer Document).
Proactis and Bidco shall prepare the Scheme Document (or, if the
Acquisition is implemented by way of an Offer, the Offer Document)
to be distributed to Proactis Shareholders. Proactis and Bidco urge
Proactis Shareholders to read the Scheme Document in its entirety
(or, if the Acquisition is implemented by way of an Offer, the
Offer Document) when it becomes available because it will contain
important information relating to the Acquisition.
This announcement does not constitute a prospectus or prospectus
equivalent document.
Bidco reserves the right to elect to implement the Acquisition
by way of an Offer as an alternative to the Scheme (subject to the
Panel's consent and the terms of the Co-operation Agreement). In
such event, the Acquisition will be implemented on substantially
the same terms, so far as applicable, as those which will apply to
the Scheme, subject to appropriate amendments to reflect, among
other things, the change in method of effecting the Acquisition
(including, without limitation: (i) the inclusion of an acceptance
condition set at 75 per cent. of the Proactis Shares to which such
Offer relates (or such other percentage as Bidco may, subject to
the rules of the Takeover Code and the terms of the Co-operation
Agreement and with the consent of the Panel, decide); and (ii)
those required by, or deemed appropriate by, Bidco under applicable
law, including US securities law). Further, if sufficient
acceptances of such Offer are received and/or sufficient Proactis
Shares are otherwise acquired, it is the intention of Bidco to
apply the provisions of the Companies Act 2006 to acquire
compulsorily any outstanding Proactis Shares to which such Offer
relates.
Overseas Shareholders
This announcement has been prepared in accordance with and for
the purpose of complying with the laws of England and Wales, the
Takeover Code, the Market Abuse Regulation, the AIM Rules and the
Disclosure Guidance and Transparency Rules and 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 of jurisdictions outside England.
The release, publication or distribution of this announcement in
or into certain jurisdictions other than the United Kingdom may be
restricted by law and therefore any persons who are subject to the
laws of any jurisdiction other than the United Kingdom should
inform themselves of, and observe, any applicable requirements of
their jurisdictions.
The availability of the Acquisition to Proactis Shareholders who
are not resident in and citizens of the United Kingdom may be
affected by the laws of the relevant jurisdictions in which they
are located or of which they are citizens. Persons who are not
resident in and citizens of the United Kingdom should inform
themselves of, and observe, any applicable legal or regulatory
requirements of their jurisdictions. In particular, the ability of
persons who are not resident in and citizens of the United Kingdom
to vote their Proactis Shares with respect to the Scheme at the
Court Meeting, or to execute and deliver forms of proxy appointing
another person to vote at the Court Meeting on their behalf, may be
affected by the laws of the relevant jurisdictions in which they
are located or of which they are a citizen. Any failure to comply
with the applicable restrictions may constitute a violation of the
securities laws of any such jurisdiction. To the fullest extent
permitted by applicable law, the companies and persons involved in
the Acquisition disclaim any responsibility or liability for the
violation of such restrictions by any person.
Unless otherwise determined by Bidco or required by the Takeover
Code, and permitted by applicable law and regulation, participation
in the Acquisition will not be made available, directly or
indirectly, in, into or from a Restricted Jurisdiction where to do
so would violate the laws in that jurisdiction and no person may
vote in favour of the Acquisition by any such use, means,
instrumentality or from within a Restricted Jurisdiction or any
other jurisdiction if to do so would constitute a violation of the
laws of that jurisdiction. Accordingly, copies of this announcement
and any formal documentation relating to the Acquisition are not
being, and must not be, directly or indirectly, mailed or otherwise
forwarded, distributed or sent in, into or from any Restricted
Jurisdiction and persons receiving this announcement and all such
documents relating to the Acquisition (including custodians,
nominees and trustees) must not mail or otherwise forward,
distribute or send them in, into or from any Restricted
Jurisdiction. Doing so may render invalid any related purported
vote in respect of the Acquisition. If the Acquisition is
implemented by way of an Offer (unless otherwise permitted by
applicable law and regulation), the Offer may not be made directly
or indirectly, in or into, or by the use of mails or any means or
instrumentality (including, but not limited to, facsimile, e-mail
or other electronic transmission, telex or telephone) of interstate
or foreign commerce of, or of any facility of a national, state or
other securities exchange of, any Restricted Jurisdiction and the
Offer may not be capable of acceptance by any such use, means,
instrumentality or facilities.
Further details in relation to Overseas Shareholders will be
contained in the Scheme Document.
Notice to US investors in Proactis
Proactis Shareholders in the United States should note that the
Acquisition relates to the shares of an English company and is
proposed to be made by means of a scheme of arrangement provided
for under, and governed by, the laws of England and Wales. If the
Acquisition is carried out under such Scheme, it is expected that
any Alternative Offer Securities issued pursuant to the Acquisition
would be issued in reliance upon the exemption from the
registration requirements under the US Securities Act provided by
Section 3(a)(10) thereof and would not be registered under the US
Securities Act. Securities issued pursuant to the Scheme will not
be registered under any laws of any state, district or other
jurisdiction of the United States, and may only be issued to
persons resident in such state, district or other jurisdiction
pursuant to an exemption from the registration requirements of such
laws.
Neither the proxy solicitation nor the tender offer rules under
the US Exchange Act will apply to the Scheme. Moreover, the Scheme
will be subject to the disclosure and procedural requirements and
practices applicable in the United Kingdom to schemes of
arrangement, which differ from the disclosure requirements of US
tender offer and proxy solicitation rules. If, in the future, Bidco
exercises the right to implement the Acquisition by way of an Offer
and determines to extend the offer into the United States, the
Acquisition will be made in compliance with applicable United
States laws and regulations, including any applicable exemptions
under the US Exchange Act. Such an Offer would be made in the
United States by Bidco and no one else. In accordance with normal
United Kingdom practice and consistent with Rule 14e-5 under the US
Exchange Act, Bidco, certain affiliated companies and the nominees
or brokers (acting as agents) may make certain purchases of, or
arrangements to purchase, shares in Proactis outside such Offer
during the period in which such Offer would remain open for
acceptance. If such purchases or arrangements to purchase were to
be made they would be made outside the United States either in the
open market at prevailing prices or in private transactions at
negotiated prices and would comply with applicable law, including,
to the extent applicable, the US Exchange Act. Any information
about such purchases will be disclosed as required in the United
Kingdom, will be reported to a Regulatory Information Service and
will be available on the London Stock Exchange website at
www.londonstockexchange.com.
The financial information included in this announcement and the
Scheme Document (or, if the Acquisition is implemented by way of an
Offer, the Offer Document) has been or will have been prepared in
accordance with generally accepted accounting principles of the
United Kingdom and thus may not be comparable to the financial
information of US companies or companies whose financial statements
are prepared in accordance with generally accepted accounting
principles in the United States.
The receipt of consideration by a US holder for the transfer of
its Proactis Shares pursuant to the Acquisition may be a taxable
transaction for US federal income tax purposes and under applicable
US state and local, as well as non-US and other, tax laws. Each
Proactis Shareholder is urged to consult their independent
professional adviser immediately regarding the tax consequences of
the Acquisition applicable to them, including under applicable US
federal, state and local, as well as non-US and other, tax
laws.
It may be difficult for US holders of Proactis Shares to enforce
their rights and any claim arising out of the US federal laws or to
enforce against them a judgment of a US court predicated upon the
securities laws of the United Kingdom, since Bidco and Proactis are
incorporated in a non-US jurisdiction, and some or all of their
officers and directors may be residents of countries other than the
United States. US holders of Proactis Shares may not be able to sue
a non-US company or its officers or directors in a non-US court for
violations of the US securities laws. Further, it may be difficult
to compel a non-US company and its affiliates to subject themselves
to a US court's judgement.
Cautionary note regarding forward-looking statements
This announcement (including information incorporated by
reference in this announcement), oral statements made regarding the
Acquisition, and other information published by Bidco and Proactis
contain certain statements which are, or may be deemed to be,
"forward-looking statements". Forward-looking statements are
prospective in nature and are not based on historical facts, but
rather on current expectations and projections of the management of
Bidco and Proactis about future events, and are therefore subject
to risks and uncertainties which could cause actual results to
differ materially from the future results expressed or implied by
the forward-looking statements.
These forward-looking statements can be identified by the fact
that they do not relate only to historical or current facts.
Forward-looking statements often use words such as "anticipate",
"target", "expect", "estimate", "intend", "plan", "goal",
"believe", "hope", "aims", "continue", "will", "may", "should",
"would", "could", or other words of similar meaning or derivatives
thereof. These statements are based on assumptions and assessments
made by Proactis and/or Bidco in light of their experience and
their perception of historical trends, current conditions, future
developments and other factors they believe appropriate. By their
nature, forward-looking statements involve risk and uncertainty,
because they relate to events and depend on circumstances that will
occur in the future and the factors described in the context of
such forward-looking statements in this announcement could cause
actual results and developments to differ materially from those
expressed in or implied by such forward-looking statements. Among
the factors that could cause actual results to differ materially
from those described in the forward-looking statements are changes
in the global, political, economic, business, competitive, market
and regulatory forces, future exchange and interest rates, changes
in tax rates and future business combinations or dispositions.
Although it is believed that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be
given that such expectations will prove to have been correct and
you are therefore cautioned not to place undue reliance on these
forward-looking statements which speak only as at the date of this
announcement. Neither Proactis nor Bidco assumes any obligation to
update or correct the information contained in this announcement
(whether as a result of new information, future events or
otherwise), except as required by applicable law.
Dealing and opening position disclosure requirements
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in one per cent. or more of any class of relevant
securities of an offeree company or of any securities exchange
offeror (being any offeror other than an offeror in respect of
which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following
the commencement of the offer period and, if later, following the
announcement in which any securities exchange offeror is first
identified.
An Opening Position Disclosure must contain details of the
person's interests and short positions in, and rights to subscribe
for, any relevant securities of each of (i) the offeree company and
(ii) any securities exchange offeror(s). An Opening Position
Disclosure by a person to whom Rule 8.3(a) applies must be made by
no later than 3.30 pm (London time) on the 10(th) business day
following the commencement of the offer period and, if appropriate,
by no later than 3.30 p.m. (London time) on the 10(th) business day
following the announcement in which any securities exchange offeror
is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a securities exchange
offeror prior to the deadline for making an Opening Position
Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in one per cent. or more of any class of
relevant securities of the offeree company or of any securities
exchange offeror must make a Dealing Disclosure if the person deals
in any relevant securities of the offeree company or of any
securities exchange offeror. A Dealing Disclosure must contain
details of the dealing concerned and of the person's interests and
short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror, save to the extent that these details
have previously been disclosed under Rule 8. A Dealing Disclosure
by a person to whom Rule 8.3(b) applies must be made by no later
than 3.30 p.m. (London time) on the business day following the date
of the relevant dealing. If two or more persons act together
pursuant to an agreement or understanding, whether formal or
informal, to acquire or control an interest in relevant securities
of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on a website
In accordance with Rule 26.1 of the Takeover Code, a copy of
this announcement will be made available, subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions, on Proactis' website at
https://www.proactis.com/uk/investors/ and Bidco's website at
https://cafe.pollencap.com by no later than 12 noon (London time)
on the first Business Day following the date of this announcement.
For the avoidance of doubt, neither the contents of these websites
nor any website accessible from hyperlinks is incorporated into or
forms part of this announcement.
No profit forecasts, estimates or quantified benefits
statements
No statement in this announcement is intended to constitute a
profit forecast, profit estimate or quantified benefits statement
for any period and no statement in this announcement should be
interpreted to mean that the earnings or future earnings per share
of or dividends or future dividends per share of Proactis for the
current or future financial years will necessarily match or exceed
the historical published earnings or earnings per share or
dividends per share of Proactis.
Requesting hard copy documents
In accordance with Rule 30.3 of the Takeover Code, Proactis
Shareholders, persons with information rights and participants in
Proactis Share Plans may request a hard copy of this announcement
by contacting Proactis' registrars, Link Group: (i) on +44 (0) 371
664 0300. Calls are charged at the standard geographic rate and
will vary by provider. Calls outside the United Kingdom will be
charged at the applicable international rate. Lines are open
between 09:00 - 17:30, Monday to Friday excluding public holidays
in England and Wales; or (ii) by submitting a request in writing to
Link Group, 10th Floor, Central Square, 29 Wellington Street,
Leeds, LS1 4DL. Please note that Link Group cannot provide any
financial, legal or tax advice and calls may be recorded and
monitored for security and training purposes. For persons who
receive a copy of this announcement in electronic form or via a
website notification, a hard copy of this announcement will not be
sent unless so requested. Such persons may also request that all
future documents, announcements and information to be sent to them
in relation to the Acquisition should be in hard copy form.
Electronic communications
Please be aware that addresses, electronic addresses and certain
other information provided by Proactis Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Proactis may be provided to Bidco during the
Offer Period as required under Section 4 of Appendix 4 of the
Takeover Code to comply with Rule 2.11(c).
Rounding
Certain figures included in this announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of figures that precede them.
General
If the Acquisition is effected by way of an Offer, and such an
Offer becomes or is declared unconditional in all respects and
sufficient acceptances are received, Bidco intends to exercise its
rights to apply the provisions of Chapter 3 of Part 28 of the
Companies Act 2006 so as to acquire compulsorily the remaining
Proactis Shares in respect of which the Offer has not been
accepted.
Investors should be aware that Bidco may purchase Proactis
Shares otherwise than under any Offer or the Scheme, including
pursuant to privately negotiated purchases.
If you are in any doubt about the contents of this announcement
or the action you should take, you are recommended to seek your own
independent financial advice immediately from your stockbroker,
bank manager, solicitor or independent financial adviser duly
authorised under FSMA if you are resident in the United Kingdom or,
if not, from another appropriate authorised independent financial
adviser.
Rule 2.9 of the Takeover Code
For the purposes of Rule 2.9 of the Takeover Code, Proactis
confirms that, as at 29 April 2021 (being the last Business Day
prior to this announcement), it had in issue 95,532,628 ordinary
shares of 10 pence each (excluding shares held in treasury). The
ISIN for the ordinary shares is GB00B13GSS58.
APPIX 1
CONDITIONS TO AND CERTAIN FURTHER TERMS OF THE ACQUISITION
Part A: Conditions to the Scheme and Acquisition
Long Stop Date
1. The Acquisition is conditional upon the Scheme becoming
unconditional and becoming Effective, subject to the provisions of
the Takeover Code, by no later than 11.59 p.m. on the Long Stop
Date or such later date (if any) as Bidco and Proactis may, with
the consent of the Panel, agree and (if required) the Court may
allow.
Scheme approval
2. The Scheme will be conditional upon:
(a) (i) its approval by a majority in number representing not
less than 75 per cent. in value of the Scheme Shareholders who are
on the register of members of Proactis (or the relevant class or
classes thereof, if applicable) at the Scheme Voting Record Time,
present and voting (and entitled to vote), either in person or by
proxy, at the Court Meeting and at any separate class meeting which
may be required by the Court or at any adjournment of any such
meeting, (ii) such Court Meeting and any separate class meeting
which may be required by the Court being held on or before the 22nd
day after the expected date of the Court Meeting to be set out in
the Scheme Document in due course (or such later date as may, with
the consent of the Panel, be agreed between Bidco and Proactis (and
that the Court may approve if so required));
(b) (i) the Special Resolutions being duly passed at the General
Meeting (or any adjournment thereof) and (ii) such General Meeting
being held on or before the 22nd day after the expected date of the
General Meeting to be set out in the Scheme Document in due course
(or such later date as may, with the consent of the Panel, be
agreed between Bidco and Proactis (and that the Court may approve
if so required)); and
(c) the sanction of the Scheme by the Court with or without
modification (but subject to any such modification being acceptable
to Bidco and Proactis) on or before the 22nd day after the expected
date of the Scheme Court Hearing to be set out in the Scheme
Document in due course (or such later date as may, with the consent
of the Panel, be agreed between Bidco and Proactis (and that the
Court may approve if so required)) and the delivery of the office
copy of the Scheme Court Order to the Registrar of Companies for
registration.
General Conditions
3. In addition, Bidco and Proactis have agreed that the
Acquisition will be conditional upon the following Conditions and,
accordingly, the necessary actions to make the Scheme Effective
will not be taken unless such Conditions (as amended if
appropriate) have been satisfied or, where relevant, waived:
Certain matters arising as a result of any arrangement,
agreement, etc.
(a) except as Disclosed, there being no provision of any
agreement, arrangement, licence, lease, franchise, permit or other
instrument to which any member of the Wider Proactis Group is a
party or by or to which any such member or any of its assets may be
bound, entitled or subject or any event or circumstance, which in
consequence of the Scheme, the Acquisition or the proposed
acquisition by any member of the Wider Bidco Group of any shares or
other securities in Proactis or because of a change in the control
or management of any member of the Wider Proactis Group or
otherwise, would or might reasonably be expected to result in, to
an extent which is material in the context of the Wider Proactis
Group as a whole or in the context of the Acquisition:
(i) any monies borrowed by or any other indebtedness (actual or
contingent, including without limitation, guarantees, letters of
credit and hedging contracts) of, or grant available to any such
member of the Wider Proactis Group, being or becoming repayable or
capable of being declared repayable immediately or prior to its or
their stated maturity date or repayment date or the ability of any
such member to borrow monies or incur any indebtedness being
withdrawn or inhibited or being capable of becoming or being
withdrawn or inhibited;
(ii) any such agreement, arrangement, licence, lease, franchise,
permit or other instrument or the rights, liabilities, obligations
or interests of any such member of the Wider Proactis Group
thereunder being terminated or adversely modified or adversely
affected or any obligation or liability arising or any adverse
action being taken or arising thereunder;
(iii) any assets or interests of any member of the Wider
Proactis Group being or falling to be disposed of or charged or any
right arising under which any such asset or interest could be
required to be disposed of or charged;
(iv) the creation or enforcement of any mortgage, charge,
encumbrance or other security interest over the whole or any part
of the business, property or assets of any member of the Wider
Proactis Group or any such mortgage, charge, encumbrance or other
security interest (whenever created, arising or having arisen)
becoming enforceable;
(v) the rights, liabilities, obligations or interests of any
member of the Wider Proactis Group under any such arrangement,
agreement, licence, permit, lease or instrument or the interests or
business of any such member with any other person or body or firm
or company (or any arrangement or agreement relating to any such
interests or business) being or becoming capable of being
terminated, adversely modified or affected;
(vi) the business, assets, value of, or the financial or trading
position, profits or prospects of, any member of the Wider Proactis
Group being prejudiced or adversely affected;
(vii) any assets or interests of, or any asset the use of which
is enjoyed by, any member of the Wider Proactis Group being or
failing to be disposed of or charged or any right arising under
which any such asset or interest could be required to be disposed
of or charged or could cease to be available to any member of the
Wider Proactis Group;
(viii) any member of the Wider Proactis Group ceasing to be able
to carry on business under any name under which it presently does
so; or
(ix) the creation or acceleration of any liability, actual or
contingent, by any member of the Wider Proactis Group (including
any tax liability or any obligation to obtain or acquire any
authorisation, notice, waiver, concession, agreement or exemption
from any government or governmental, quasi-governmental,
supranational, statutory, regulatory, environmental or
investigative body, court, trade agency, association, institution,
self-regulatory authority, or any other body or person whatsoever
in any jurisdiction (each a "Third Party" and together the "Third
Parties") or any other person), excluding trade creditors and other
liabilities incurred in the ordinary course of business,
and no event having occurred which, under any provision of any
such agreement, arrangement, licence, permit, lease, franchise or
other instrument to which any member of the Wider Proactis Group is
a party or by or to which any such member or any of its assets may
be bound, entitled or subject, would result in any of the events or
circumstances as are referred to in Conditions 3(a)(i) to (ix);
General regulatory
(b) except as Disclosed, no Third Party having given notice of a
decision to take, institute, implement or threaten in writing any
action, proceeding, suit, investigation, enquiry or reference (and
not having withdrawn that notice), or having required any action to
be taken or otherwise having done anything, or having enacted, made
or proposed any statute, regulation, decision, order or change to
published practice (and in each case, not having withdrawn the
same) and there not continuing to be any outstanding statute,
regulation, decision or order which would or might reasonably be
expected to:
(i) require, prevent or delay the divestiture, or alter the
terms envisaged for any such divestiture by any member of the Wider
Bidco Group or any member of the Wider Proactis Group of all or any
portion of their respective businesses, assets or property or
impose any limitation on the ability of any of them to conduct
their respective businesses (or any part thereof) or to own,
control or manage any of their respective assets or properties (or
any part thereof) which, in any such case, is material in the
context of the Wider Proactis Group or the Wider Bidco Group in
either case taken as a whole;
(ii) require, prevent or delay the divestiture by any member of
the Wider Bidco Group of any shares or other securities (or the
equivalent) in any member of the Wider Proactis Group or the Wider
Bidco Group;
(iii) impose any limitation on, or result in a delay in, the
ability of any member of the Wider Bidco Group directly or
indirectly to acquire or to hold or to exercise effectively all or
any rights of ownership in respect of shares or loans or securities
convertible into shares or any other securities (or the equivalent)
in any member of the Wider Proactis Group or the Wider Bidco Group
or to exercise management control over any such member;
(iv) otherwise adversely affect the business, assets, profits or
prospects of any member of the Wider Bidco Group or of any member
of the Wider Proactis Group in a manner which is adverse to and
material in the context of the Wider Bidco Group or the Wider
Proactis Group, in either case taken as a whole;
(v) make the Scheme, the Acquisition, its implementation or the
acquisition or proposed acquisition by Bidco or any member of the
Wider Bidco Group of any shares or other securities in, or control
or management of Proactis void, illegal, and/or unenforceable under
the laws of any jurisdiction, or otherwise, directly or indirectly,
restrain, restrict, prohibit, delay or otherwise interfere with the
same, or impose additional conditions or obligations with respect
thereto, or otherwise challenge, impede, interfere or require
material amendment of the Scheme, the Acquisition, its
implementation or the acquisition or proposed acquisition by Bidco
or any member of the Wider Bidco Group of any shares or other
securities in, or control or management of Proactis;
(vi) other than pursuant to the Acquisition, require any member
of the Wider Bidco Group or the Wider Proactis Group to offer to
acquire any shares or other securities (or the equivalent) or
interest in any member of the Wider Proactis Group or the Wider
Bidco Group owned by any third party;
(vii) impose any limitation on the ability of any member of the
Wider Proactis Group to conduct, integrate or co-ordinate all or
any part of its business with all or any part of the businesses of
any other members of the Wider Proactis Group or the Wider Bidco
Group which is adverse to and material in the context of the Wider
Bidco Group or the Wider Offer Group, in either case taken as a
whole; or
(viii) result in any member of the Wider Proactis Group or Wider
Bidco Group ceasing to be able to carry on business under any name
under which it presently does so,
and all applicable waiting and other time periods (including any
extensions thereof) during which any such Third Party could decide
to take, institute, implement or threaten in writing any such
action, proceeding, suit, investigation, enquiry or reference or
take any other step under the laws of any jurisdiction in respect
of the Scheme, the Acquisition or the acquisition or proposed
acquisition of any Proactis Shares or otherwise intervene having
expired, lapsed or been terminated;
(c) all necessary notifications, filings or applications having
been made in connection with the Acquisition and all statutory or
regulatory obligations in any jurisdiction having been complied
with in connection with the Scheme, the Acquisition, its
implementation or the acquisition by any member of the Wider Bidco
Group of any shares or other securities in, or control or
management of, Proactis and all authorisations, orders,
recognitions, grants, consents, licences, confirmations,
clearances, permissions and approvals reasonably deemed necessary
or appropriate by Bidco or any member of the Wider Bidco Group for
or in respect of the Scheme, the Acquisition, its implementation or
the proposed acquisition of any shares or other securities in, or
control or management of, Proactis by any member of the Wider Bidco
Group having been obtained in terms and in a form satisfactory to
Bidco from all appropriate Third Parties or persons with whom any
member of the Wider Proactis Group has entered into contractual
arrangements and all such authorisations, orders, recognitions,
grants, consents, licences, confirmations, clearances, permissions
and approvals together with all authorisations orders,
recognitions, grants, licences, confirmations, clearances,
permissions and approvals necessary or appropriate to carry on the
business of any member of the Wider Proactis Group remaining in
full force and effect and all filings necessary for such purpose
have been made and there being no notice or intimation of any
intention to revoke or not to renew any of the same at the time at
which the Offer becomes otherwise unconditional and all necessary
statutory or regulatory obligations in any jurisdiction having been
complied with;
Certain events occurring since 31 July 2020
(d) except as Disclosed, no member of the Wider Proactis Group having, since 31 July 2020:
(i) issued or agreed to issue or authorised or proposed the
issue of, additional shares of any class, or securities or
securities convertible into, or exchangeable for, or rights,
warrants or options to subscribe for or acquire, any such shares or
securities or convertible securities or transferred, sold or agreed
to transfer or sell or authorise or propose the transfer or sale of
shares out of treasury (except, where relevant, intra-Proactis
Group or for Proactis Shares issued pursuant to the exercise of
options or vesting of awards in the ordinary course under the
Proactis Share Plans);
(ii) recommended, declared, paid or made or resolved to
recommend, declare, pay or make any bonus, dividend or other
distribution (whether payable in cash or otherwise) other than
dividends (or other distributions whether payable in cash or
otherwise) lawfully paid or made intra-Proactis Group;
(iii) save for intra-Proactis Group transactions, implemented,
effected, authorised, proposed or announced its intention to
implement, effect, authorise or propose any merger, demerger,
reconstruction, amalgamation, sub-division, scheme, commitment or
acquisitions or disposal of assets or shares or loan capital (or
the equivalent thereof) in any undertaking or undertakings in any
such case to an extent which is or might reasonably be expected to
be material in the context of the Wider Proactis Group taken as a
whole or material in the context of the Acquisition;
(iv) save for intra-Proactis Group transactions, disposed of, or
transferred, mortgaged or charged, or created any security interest
over any asset or any right, title or interest in any asset
(including shares and trade investments) or authorised, proposed or
announced any intention to do so in a manner which is or might
reasonably be expected to be material in the context of the Wider
Proactis Group taken as a whole or material in the context of the
Acquisition;
(v) save for intra-Proactis Group transactions entered into the
ordinary course of business, entered into, implemented or
authorised the entry into, any joint venture, asset or profit
sharing arrangement, partnership or merger of business or corporate
entities, in each case, to an extent which is material in the
context of the Wider Proactis Group taken as whole or in the
context of the Acquisition;
(vi) made any alteration to its memorandum or articles of
association or other incorporation documents (other than in
connection with the Scheme);
(vii) save for intra-Proactis Group transactions, made,
authorised, proposed or announced an intention to propose any
change in its loan capital;
(viii) save for intra-Proactis Group transactions in the
ordinary course, issued, authorised or proposed or announced an
intention to authorise or propose the issue of any debentures, or
any change in or to the terms of any debentures or become subject
to any contingent liability or incurred or increased any
indebtedness which is or might reasonably be expected to be
material in the context of the Wider Proactis Group taken as a
whole or material in the context of the Acquisition;
(ix) purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities
or reduced or, save in respect of the matters mentioned in
sub-paragraph (i) above, made any other change to any part of its
share capital;
(x) entered into or varied or authorised, proposed or announced
its intention to enter into or vary any contract, arrangement,
agreement, transaction or commitment (whether in respect of capital
expenditure or otherwise) which is of a long term, onerous or
unusual nature or magnitude or which is or might reasonably be
expected to be restrictive on the businesses of any member of the
Wider Proactis Group or the Wider Bidco Group or which involves or
could involve an obligation of such a nature or magnitude or which
is other than in the ordinary course of business and which is
material in the context of the Wider Proactis Group taken as a
whole;
(xi) entered into or materially varied the terms of, or made any
offer (which remains open for acceptance) to enter into or
materially vary the terms of any contract, service agreement,
commitment or arrangement with any director or, except for salary
increases or bonuses in the ordinary course for any senior
executive of Proactis, other than as agreed by the Panel and
Bidco;
(xii) (other than in respect of a member of the Wider Proactis
Group which is dormant and was solvent at the relevant time) taken
or proposed any steps, corporate action or had any legal
proceedings started or threatened against it in relation to the
suspension of payments, a moratorium of indebtedness, its
winding-up (voluntary or otherwise), dissolution or reorganisation
or for the appointment of a receiver, administrative receiver,
administrator, trustee or similar officer of all or any of its
assets or revenues or any analogous or equivalent steps or
proceedings in any jurisdiction or appointed any analogous person
in any jurisdiction or had any such person appointed;
(xiii) been unable, or admitted in writing that it is unable, to
pay its debts when they fall due or commenced negotiations with one
or more of its creditors with a view to rescheduling or
restructuring any of its indebtedness, or having stopped or
suspended (or threatened to stop or suspend) payment of its debts
generally or ceased or threatened to cease carrying on all or a
substantial part of its business;
(xiv) entered into any contract, transaction or arrangement
which would be restrictive on the business of any member of the
Wider Proactis Group or the Wider Bidco Group other than to a
nature and extent which is normal in the context of the business
concerned;
(xv) terminated or varied the terms of any agreement or
arrangement between any member of the Wider Proactis Group and any
other person in a manner which would or might reasonably be
expected to be materially adverse to the Wider Proactis Group taken
as a whole or is material in the context of the Acquisition;
(xvi) waived, compromised or settled any material claim or
regulatory proceeding (whether actual or threatened) by or against
any member of the Wider Proactis Group otherwise than in the
ordinary course of business;
(xvii) made, proposed or agreed or consented to or procured any
change to, or the custodian or trustee of any scheme having made a
change to (to an extent which would or might reasonably be expected
to be materially adverse to the Wider Proactis Group taken as a
whole or to be material in the context of the Acquisition):
(1) the terms of the trust deeds constituting the pension
scheme(s) established by any member of the Wider Proactis Group for
its directors, employees, former employees or their dependents;
(2) the contributions payable to any such scheme(s) or to the
benefits which accrue or to the pensions which are payable
thereunder;
(3) the basis on which qualification for, or accrual or
entitlement to, such benefits or pensions are calculated or
determined; or
(4) the basis upon which the liabilities (including pensions) of
such pension schemes are funded, valued or made;
(xviii) carried out any act:
(1) which would or could reasonably be expected to lead to the
commencement of the winding up of any pension scheme(s) established
by any member of the Wider Proactis Group for its directors, former
directors, employees, former employees or their dependants;
(2) which would or might reasonably be expected to create a
material debt owed by an employer to any such plan; or
(3) which would or might reasonably be expected to accelerate
any obligation on any employer to fund or pay additional
contributions to any such plan;
(xix) proposed, agreed to provide or modified the terms of any
share option scheme, incentive scheme, retention scheme or other
benefit (including compensation) relating to the employment or
termination of employment of any person employed by the Wider
Proactis Group other than in accordance with the terms of the
Co-operation Agreement or Acquisition or, if required by the
Takeover Code, as agreed by the Panel and/or Bidco; or
(xx) entered into any agreement, arrangement, commitment or
contract or passed any resolution or made any offer (which remains
open for acceptance) with respect to or announced an intention to,
or to propose to, effect any of the transactions, matters or events
referred to in this Condition; or
(xxi) other than with the consent of Bidco, having taken (or
agreed or proposed to take) any action which requires, or would
require, the consent of the Panel or the approval of Proactis
Shareholders in general meeting in accordance with, or as
contemplated by, Rule 21.1 of the Takeover Code,
and, for the purposes of paragraphs (i) to (v) (inclusive),
(vii) and (viii) of this Condition, the term "Proactis Group" shall
mean Proactis and its wholly-owned subsidiaries;
No material adverse change, litigation, regulatory enquiry or
similar
(e) except as Disclosed, since 31 July 2020, in each case to an
extent which is or might reasonably be expected to be material in
the context of the Wider Proactis Group taken as whole, or material
in the context of the Acquisition:
(i) no adverse change or deterioration having occurred, and no
circumstance having arisen which would or might reasonably be
expected to result in any adverse change or deterioration, in the
business, assets, financial or trading position or profits or
prospects of any member of the Wider Proactis Group;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings to which any member of the Wider Proactis
Group is or may become a party (whether as a plaintiff, defendant
or otherwise) and no investigation or other regulatory proceedings
by any Third Party against or in respect of any member of the Wider
Proactis Group having been instituted, announced or threatened by
or against or remaining outstanding in respect of any member of the
Wider Proactis Group;
(iii) no enquiry, review or investigation by (or complaint or
reference to) any Third Party or other investigative body having
been threatened, announced, instituted or remaining outstanding by,
against or in respect of any member of the Wider Proactis
Group;
(iv) no contingent or other liability having arisen or become
apparent or increased which affects, or which would be reasonably
likely to affect, adversely the business, assets, financial or
trading position or profits or prospects of any member of the Wider
Proactis Group;
(v) no steps having been taken, and no omissions having been
made, which are reasonably likely to result in the withdrawal,
cancellation, termination or modification of any licence held by
any member of the Wider Proactis Group which is necessary for the
proper carrying on of its business; and
(vi) no member of the Wider Proactis Group having conducted its
business in material breach of any applicable laws and
regulations;
No discovery of certain matters regarding information,
liabilities and environmental issues
(f) except as Disclosed, Bidco not having discovered, in each
case to an extent which is or might reasonably be expected to be
material in the context of the Wider Proactis Group taken as a
whole, or material in the context of the Acquisition:
(i) that any financial, business or other information concerning
the Wider Proactis Group as contained in the information publicly
disclosed at any time by or on behalf of any member of the Wider
Proactis Group is misleading, contains a misrepresentation of fact
or omits to state a fact necessary to make that information not
misleading;
(ii) that any member of the Wider Proactis Group is subject to
any liability (contingent or otherwise) which is not disclosed in
the 2020 Proactis Annual Report;
(iii) that any past or present member of the Wider Proactis
Group has failed to comply in any material respect with any
applicable legislation, regulations or other requirements of any
jurisdiction or any Authorisations relating to the use, treatment,
storage, carriage, disposal, discharge, spillage, release, leak or
emission of any waste or hazardous substance or any substance
likely to impair the environment (including property) or harm human
health or otherwise relating to environmental matters or the health
and safety of humans, which non-compliance would be likely to give
rise to any liability including any penalty for non-compliance
(whether actual or contingent) on the part of any member of the
Wider Proactis Group;
(iv) that there is or is reasonably likely to be any obligation
or liability (whether actual or contingent) or requirement to make
good, remediate, repair, reinstate or clean up any property, asset
or any controlled waters currently or previously owned, occupied,
operated or made use of or controlled by any past or present member
of the Wider Proactis Group (or on its behalf), or in which any
such member may have or previously have had or be deemed to have
had an interest, under any environmental legislation, common law,
regulation, notice, circular, Authorisation or order of any Third
Party or any other person or body in any jurisdiction or to
contribute to the cost thereof or associated therewith or indemnify
any person in relation thereto;
(v) that circumstances exist (whether as a result of the
Acquisition or otherwise) which would be reasonably likely to lead
to any Third Party instituting, or whereby any past or present
member of the Wider Proactis Group would be likely to be required
to institute, an environmental audit or take any other steps which
would in any such case be reasonably likely to result in any
liability (whether actual or contingent) to improve, modify
existing or install new plant, machinery or equipment or carry out
changes in the processes currently carried out or make good,
remediate, repair, re-instate or clean up any land or other asset
currently or previously owned, occupied or made use of by any past
or present member of the Wider Proactis Group (or on its behalf) or
by any person for which a member of the Wider Proactis Group is or
has been responsible, or in which any such member may have or
previously have had or be deemed to have had an interest; or
(vi) any information which affects the import of any information
disclosed at any time by or on behalf of any member of the Wider
Proactis Group;
Anti-corruption, sanctions, criminal property, IT
(g) no past or present member, director, officer, employee or
agent of the Wider Proactis Group or any person that performs or
has performed services (or otherwise acts or has acted) for or on
behalf of any such company being or at any time having been engaged
in any activity, practice or conduct which would constitute an
offence under the Bribery Act 2010, the US Foreign Corrupt
Practices Act of 1977 or any other anti-corruption legislation
applicable to the Wider Proactis Group;
(h) no asset nor any member of the Wider Proactis Group
constituting criminal property as defined by section 340(3) of the
Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that
definition);
(i) no past or present member, director, officer, employee or
agent of the Wider Proactis Group or any person that performs or
has performed services for or on behalf of any such member,
director, officer or employee being or at any time having been
engaged in any activity or business with, made any investments in,
made any funds or assets available to or received any funds or
assets from:
(i) any government, entity or individual in respect of which US
or European Union persons, or persons operating in those
territories, are prohibited from engaging in activities or doing
business, or from receiving or making available funds or economic
resources, by US or European Union laws or regulations, including
the economic sanctions administered by the United States Office of
Foreign Assets Control, or HM Treasury & Customs; or
(ii) any government, entity or individual targeted or covered by
any of the economic sanctions administered or imposed by the United
Nations, the US (including, without limitation, the United States
Office of Foreign Assets Control), the United Kingdom, the European
Union (or any of its respective member states) or any other
governments or supranational body or authority in any jurisdiction,
save that this shall not apply if and to the extent that it is or
would be unenforceable by reason of breach of any applicable
Blocking Law;
(j) no member of the Wider Proactis Group being or at any time
having been engaged in a transaction which would cause any member
of the Wider Bidco Group to be in breach of any applicable law or
regulation on completion of the Acquisition, including the economic
sanctions administered by the United States Office of Foreign
Assets Control or HM Treasury & Customs or any government,
entity or individual targeted by any of the economic sanctions of
the United Nations, United States, the United Kingdom or the
European Union or any of its member states or any other governments
or supranational body or authority in any jurisdiction, save that
this shall not apply if and to the extent that it is or would be
unenforceable by reason of breach of any applicable Blocking Law;
and
(k) no disruption having occurred in the operation of the Wider
Proactis Group as a result of issues relating to information
technology or any failure or other substandard performance of any
such information technology (including, without limitation, any
information security breach or unauthorised access of, or
unauthorised acts in relation to, any such information technology),
in each case which is material in the context of the Wider Proactis
Group.
Part B: Certain further terms
1. Subject to the requirements of the Panel, Bidco reserves the right to waive:
a) the deadline set out in Condition 1 in Part A of this
Appendix 1, and any of the deadlines set out in Condition 2 in Part
A of this Appendix 1 for the timing of the Court Meeting and the
General Meeting. If any such deadline is not met, Bidco will make
an announcement by 8.00 a.m. on the Business Day following such
deadline confirming whether it has invoked or waived the relevant
Condition or agreed with Proactis to extend the deadline in
relation to the relevant Condition. In all other respects,
Condition 2 in Part A of this Appendix 1 cannot be waived; and
b) in whole or in part, all or any of Conditions 3(a) to (k)
(inclusive) in Part A of this Appendix 1.
2. Conditions 3(a) to (k) (inclusive) must be fulfilled or
waived by no later than 11.59pm on the date immediately preceding
the date of the Scheme Court Hearing, failing which the Scheme will
lapse.
3. Bidco shall be under no obligation to waive (if capable of
waiver), to determine to be or remain satisfied or to treat as
satisfied or fulfilled any of the Conditions capable of waiver by a
date earlier than the latest date specified above for the
fulfilment or waiver thereof, notwithstanding that the other
Conditions of the Acquisition may at such earlier date have been
waived or fulfilled and that there are at such earlier date no
circumstances indicating that any of such Conditions may not be
capable of fulfilment.
4. If Bidco is required by the Panel to make an offer for
Proactis Shares under the provisions of Rule 9 of the Takeover
Code, Bidco may make such alterations to any of the above
Conditions and terms of the Acquisition as are necessary to comply
with the provisions of that Rule.
5. The Acquisition will lapse if the Acquisition or any matter
arising from or relating to the Scheme or Acquisition becomes
subject to a CMA Phase 2 Reference before the date of the Scheme
Court Hearing.
6. Under Rule 13.5(a) of the Takeover Code, Bidco may not invoke
a Condition so as to cause the Acquisition not to proceed, to lapse
or to be withdrawn unless the circumstances which give rise to the
right to invoke the Condition are of material significance to Bidco
in the context of the Acquisition. Conditions 1, 2(a), 2(b) and
2(c) above and, if applicable, any acceptance condition if the
Acquisition is implemented by means of an Offer, are not subject to
this provision of the Takeover Code.
7. The Proactis Shares acquired under the Acquisition will be
acquired fully paid and free from all liens, equities, charges,
encumbrances, options, rights of pre-emption and any other third
party rights and interests of any nature and together with all
rights now or hereafter attaching or accruing to them, including,
without limitation, voting rights and the right to receive and
retain in full all dividends and other distributions (if any)
announced, declared, made or paid, or any other return of capital
(whether by reduction of share capital or share premium account or
otherwise) made, in each case by reference to a record date falling
on or after the Effective Date.
8. If, on or after the date of this announcement but prior to
the Effective Date, any dividend and/or other form of capital
return or distribution is announced, declared, made or paid or
becomes payable in respect of Proactis Shares, Bidco reserves the
right to reduce the consideration payable under the terms of the
Cash Offer (and, as the case may be, the number of Alternative
Offer Securities due under the terms of the Alternative Offer) by
an amount up to the amount of such dividend and/or distribution
and/or return of capital, in which case any reference in this
announcement to the consideration payable under the Cash Offer (or
consideration due under the Alternative Offer) will be deemed to be
a reference to the consideration as so reduced. Any exercise by
Bidco of its rights referred to in this paragraph shall be the
subject of an announcement and, for the avoidance of doubt, shall
not be regarded as constituting any revision or variation of the
terms of the Scheme. In such circumstances, Proactis Shareholders
would be entitled to retain any such dividend, distribution or
other return of capital declared, made or paid which becomes
payable. If and to the extent that any such dividend, distribution
or other return of capital is announced, declared, made or paid or
becomes payable and is either: (i) transferred pursuant to the
Acquisition on a basis which entitles Bidco to receive the
dividend, distribution or other return of capital and to retain it;
or (ii) cancelled before payment, the consideration payable under
the terms of the Cash Offer (and, as the case may be, the number of
Alternative Offer Securities due under the terms of the Alternative
Offer) shall not be subject to change in accordance with this
paragraph 8. Any exercise by Bidco of its rights referred to in
this paragraph 8 shall not be regarded as constituting any revision
or variation of the Acquisition.
9. Bidco reserves the right to elect to implement the
Acquisition by way of an Offer as an alternative to the Scheme
(subject to the Panel's consent and the terms of the Co-operation
Agreement). In such event, the Offer will be implemented on
substantially the same terms, so far as applicable, and subject to
the terms of the Co-operation Agreement, as those which would apply
to the Scheme, subject to appropriate amendments to reflect, among
other things, the change in the method of effecting the Acquisition
(including, without limitation: (i) the inclusion of an acceptance
condition set at 75 per cent. of the Proactis Shares to which such
Offer relates (or such other percentage as Bidco may, subject to
the rules of the Takeover Code and the terms of the Co-operation
Agreement and with the consent of the Panel, decide); and (ii)
those required by, or deemed appropriate by, Bidco under applicable
law, including US securities law. Further, if sufficient
acceptances of such Offer are received and/or sufficient Proactis
Shares are otherwise acquired, it is the intention of Bidco to
apply the provisions of the Companies Act 2006 to acquire
compulsorily any outstanding Proactis Shares to which such offer
relates.
10. The availability of the Acquisition to persons not resident
in the United Kingdom may be affected by the laws of the relevant
jurisdictions. Persons who are not resident in the United Kingdom
should inform themselves about and observe any applicable
requirements. The Alternative Offer Securities have not been, and
unless Bidco otherwise elects in the event of an Offer will not be,
registered under the US Securities Act or any laws of any state,
district or other jurisdiction of the United States, under any of
the relevant securities laws of any other Restricted Jurisdiction.
Accordingly, the Alternative Offer Securities may not be offered,
sold or delivered, directly or indirectly, in the United States, or
any other Restricted Jurisdiction, except pursuant to exemptions
from applicable requirements of any such jurisdiction, including
the exemption from the registration requirements of the US
Securities Act provided by Section 3(a)(10) thereof.
11. The Acquisition is not being made, directly or indirectly,
in, into or from, or by use of the mails of, or by any means of
instrumentality (including, but not limited to, facsimile, e-mail
or other electronic transmission, telex or telephone) of interstate
or foreign commerce of, or of any facility of a national, state or
other securities exchange of, any Restricted Jurisdiction.
12. This announcement and any rights or liabilities arising
hereunder, the Acquisition and the Scheme, and any proxies will be
governed by English law and be subject to the jurisdiction of the
Court and to the Conditions and further terms set out in this
Appendix 1 to be set out in the Scheme Document. The Co-operation
Agreement and any dispute or claim arising out of, or in connection
with, (whether contractual or non-contractual in nature) is
governed by English law (save to the extent expressly set out
therein) and is subject to the jurisdiction of the courts of
England and Wales. The Acquisition will be subject to the
applicable requirements of English law, the Takeover Code, the
Panel, the AIM Rules, the London Stock Exchange and the FCA.
13. Each of the Conditions shall be regarded as a separate
Condition and shall not be limited by reference to any other
Condition.
APPIX 2
SOURCES AND BASES OF INFORMATION
In this announcement:
1. Unless otherwise stated, historical financial information
relating to the Proactis Group has been extracted or derived
(without any adjustment) from the 2020 Proactis Annual Report.
2. As at the close of business on 29 April 2021 (being the last
Business Day prior to the date of this announcement), Proactis had
in issue 95,532,628 Shares. The International Securities
Identification Number for Proactis Shares is GB00B13GSS58.
3. The value attributable to the entire issued ordinary share
capital of Proactis is calculated on the basis of the number of
Proactis Shares as referred to in paragraph 2 above.
4. Unless otherwise stated, all prices and closing prices for
Proactis Shares are closing middle market quotations derived from
the London Stock Exchange Daily Official List (SEDOL).
5. The premium calculations to the price per Proactis Share have
been calculated by reference to a price of 41.8 pence per Proactis
Share, being the closing price on 29 April 2021 (being the last
Business Day prior to the date of this announcement).
6. Volume-weighted average prices have been derived from Capital
IQ (CapIQ) and have been rounded to the nearest single decimal
place.
(a)
APPIX 3
DETAILS OF IRREVOCABLE UNDERTAKINGS
1. Directors
The following Proactis Directors have given irrevocable
undertakings to vote (or, where applicable, procure voting) in
favour of the Scheme at the Court Meeting and the Special
Resolutions to be proposed at the General Meeting (or in the event
that the Acquisition is implemented by an Offer, to accept or
procure acceptance of such Offer) in respect of their own
beneficial holdings (or those Proactis Shares over which they have
control) of Proactis Shares:
Name Total Number of Percentage of existing
Proactis Shares issued share capital
Richard Hughes 15,000 0.02
Tim Sykes 382,736 0.40
Rodney Potts 8,995,427 9.42
Alan Aubrey 1,362,926 1.43
Nick Brown 67,415 0.07
As part of the irrevocable undertakings from the Proactis
Directors described above, Bidco has received irrevocable
undertakings from:
-- each of Alan Aubrey and Rodney Potts to partially elect for:
(i) the Alternative Offer (subject to the terms and conditions of
the Alternative Offer as set out in paragraph 13 above and to be
set out in the Scheme Document), in each case in respect of their
beneficial holdings of 520,976 Proactis Shares and 3,065,143
Proactis Shares respectively, representing in aggregate
approximately 3.75 per cent. of the existing issued ordinary share
capital of Proactis as at 29 April 2021 (being the last Business
Day prior to the date of this announcement); and (ii) the Cash
Offer in respect of the remainder of their beneficial holdings of
841,950 Proactis Shares and 5,930,284 Proactis Shares respectively;
and
-- each of Richard Hughes, Tim Sykes and Nick Brown to elect for
the Cash Offer (subject to the terms and conditions of the Cash
Offer set out in this announcement and to be set out in the Scheme
Document) in respect of their entire beneficial holdings of
Proactis Shares representing, together with the Proactis Shares in
respect of which Alan Aubrey and Rodney Potts have irrevocably
undertaken to elect for the Cash Offer, in aggregate approximately
7.58 per cent. of the existing issued ordinary share capital of
Proactis as at 29 April 2021 (being the last Business Day prior to
the date of this announcement).
These hard irrevocable undertakings cease to be binding: (i)
where the Acquisition is implemented by way of a Scheme, if the
Scheme Document is not published within 28 days of the date of
issue of this announcement (or such later date as may be agreed
between Proactis, Bidco and the Panel) in circumstances where the
same is caused by a breach by Bidco of clause 5 of the Co-operation
Agreement; (ii) if the Co-operation Agreement is terminated in
accordance with its terms; (iii) if Bidco announces that it does
not intend to proceed with the Acquisition and no new revised or
replacement Scheme or Offer is announced by Bidco in accordance
with Rule 2.7 of the Takeover Code at the same time; or (iv) on the
earlier of: (A) the Long Stop Date; and (B) the date on which the
Acquisition (whether implemented by way of a Scheme or an Offer) is
withdrawn or lapses in accordance with its terms, except where such
withdrawal or lapse is as a result of Bidco exercising its right to
implement the Acquisition by way of an Offer rather than a Scheme
or vice versa in accordance with the Takeover Code.
2. Shareholders
Gresham House Asset Management Limited
Name Total Number Percentage of existing
of issued share capital
Proactis Shares
Strategic Equity
Capital plc 6,104,954 6.39
Gresham House Asset Management Limited, acting in its capacity
as discretionary investment manager for Strategic Equity Capital
plc, has given an irrevocable undertaking to vote (or, where
applicable, procure voting) in favour of the Scheme at the Court
Meeting and the Special Resolutions to be proposed at the General
Meeting (or in the event that the Acquisition is implemented by an
Offer, to accept or procure acceptance of such Offer) in respect of
Strategic Equity Capital plc's beneficial holdings of Proactis
Shares:
The obligations contained in the irrevocable undertaking
provided by Gresham House Asset Management Limited lapse and cease
to have effect: (i) if Bidco announces that it does not intend to
proceed with the Acquisition and no new, revised or replacement
Scheme or Offer is announced by Bidco in accordance with Rule 2.7
of the Takeover Code at the same time; (ii) on the earlier of (A)
the Long Stop Date; or (B) the date on which the Acquisition
(whether implemented by way of a Scheme or an Offer) is withdrawn
or lapses in accordance with its terms, save where such lapse or
withdrawal is as a result of Bidco exercising its right to
implement the Acquisition by way of an Offer rather than by way of
a Scheme or vice versa in accordance with the Takeover Code; or
(iii) if any third party announces a firm intention offer in
accordance with Rule 2.7 of the Takeover Code for all of the issued
and to be issued ordinary share capital of Proactis and the
consideration payable for each Proactis Share under such proposal
represents in the reasonable opinion of Bidco a premium of 10 per
cent. or greater to the value of the consideration offered by Bidco
on the last dealing day prior to such third party announcement and
Bidco does not, within ten days of such third party announcement,
announce an increase to the consideration to be paid for the
Proactis Shares to at least an equivalent amount per Proactis Share
as being offered under the competing proposal.
Lombard Odier Asset Management (Europe) Limited
Lombard Odier Asset Management (Europe) Limited, acting in its
capacity as discretionary investment manager or sub-adviser for and
on behalf of certain funds and accounts managed by it and/or agent
of Lombard Odier Asset Management (USA) Corp acting in its capacity
as discretionary investment manager for and on behalf of certain
funds and accounts managed by it has given irrevocable undertakings
to vote (or, where applicable, procure voting) in favour of the
Scheme at the Court Meeting and the Special Resolutions to be
proposed at the General Meeting (or in the event that the
Acquisition is implemented by an Offer, to accept or procure
acceptance of such Offer) in respect of Proactis Shares held by
funds and accounted managed by it:
Name Total Number Percentage of existing
of issued share capital
Proactis Shares
Lombard Odier Asset
Management (Europe)
Limited 28,066,683 29.38
The obligations contained in the irrevocable undertaking
provided by Lombard Odier Asset Management (Europe) Limited lapse
and cease to have effect if: (i) the Acquisition has not completed
by 5.00 p.m. on the Long Stop Date; (ii) the Acquisition (whether
implemented by way of a Scheme or an Offer) lapses or is withdrawn
in a manner which is permitted by the Panel, save where such lapse
or withdrawal is as a result of Bidco exercising its right to
implement the Acquisition by way of an Offer rather than by way of
a Scheme or vice versa in accordance with the Takeover Code; or
(iii) any third party announces a firm intention offer in
accordance with Rule 2.7 of the Takeover Code for all of the issued
and to be issued ordinary share capital of Proactis and the
consideration payable for each Proactis Share under such proposal
represents a premium of 10 per cent. or greater to the value of the
consideration offered by Bidco.
APPIX 4
DETAILS ON THE TOPCO GROUP AND THE ALTERNATIVE OFFER
SECURITIES
1. INFORMATION ON TOPCO AND BIDCO
Parentco is a wholly-owned direct subsidiary of investment funds
advised and managed by Pollen Street Capital. Topco is a
wholly-owned direct subsidiary of Parentco. Bidco is a wholly-owned
direct subsidiary of Topco. None of Parentco, Topco or Bidco has
traded since the dates of their respective incorporation, nor has
any of them entered into any obligations other than in connection
with the Acquisition.
Topco is a private limited company registered in England and
Wales and incorporated on 16 April 2021. The share capital of Topco
currently comprises 10 ordinary shares of GBP0.01 each but will be
reorganised on or prior to the Effective Date so that it comprises
Topco Ordinary Shares and Alternative Offer Securities on the terms
summarised below and to be set out in the Scheme Document. The
Topco Ordinary Shares will be held by Parentco and the Alternative
Offer Securities will be held by eligible Proactis Shareholders who
elect for the Alternative Offer.
Bidco is a private limited company registered in England and
Wales and incorporated on 20 April 2021. The share capital of Bidco
currently comprises 10 ordinary shares of GBP0.01 each.
Set out below is a summary of the proposed provisions of the
Topco Shareholders' Agreement and the Topco Articles governing the
terms on which eligible Proactis Shareholders who elect for the
Alternative Offer will hold interests in Alternative Offer
Securities. Further details will be included in the Scheme
Document.
2. TERMS OF THE ISSUE OF ALTERNATIVE OFFER SECURITIES
The Alternative Offer Securities to be issued to eligible
Proactis Shareholders who elect for the Alternative Offer will be
issued credited as fully paid and will rank economically pari passu
with the Topco Ordinary Shares issued to and held by Parentco in
connection with the Acquisition, including the right to receive and
retain dividends and other distributions declared, made or paid by
reference to a record date falling on or after the date of this
announcement.
3. ECONOMIC RIGHTS
The economic rights described below are subject to the risks
also described below and in paragraph 15 of this announcement (for
example, that (i) holders of Alternative Offer Securities may be
diluted over time, potentially significantly, should holders of
Alternative Offer Securities not elect to participate in further
issues of additional shares, loan notes or other securities of
Topco; and (ii) holders of Alternative Offer Securities are not
always entitled to participate in such issues).
Subject to the above any return of proceeds to security holders
of Topco, whether on an Exit (as described below) or otherwise,
including the right to receive and retain dividends and all other
distributions and returns of capital made or paid, shall be
distributed to each holder of Topco Ordinary Shares and Alternative
Offer Securities, pro-rata to their shareholdings. The Topco
Ordinary Shares and the Alternative Offer Securities shall rank
equally as regards any distributions, dividends, buy-back, any
other capital redemption or other returns of income or capital made
by Topco.
4. VOTING RIGHTS
Alternative Offer Securities will not carry any general voting
rights at general meetings of Topco.
5. TRANSFERS OF THE ALTERNATIVE OFFER SECURITIES
No Alternative Offer Securities will be transferable without the
prior written consent of Parentco except pursuant to the drag and
tag rights described below or in respect of customary permitted
transfers to associates.
No changes in direct or indirect interests or economic
entitlements in an Alternative Offer Security shall be permitted
which circumvent the restrictions on transfer and, without
prejudice to damages claims, economic rights shall be suspended
during any such breach.
6. ADDITIONAL ISSUE OF BIDCO SECURITIES
The holders of Alternative Offer Securities will have pro-rata
"catch-up" rights for any issuances of equity or equity-linked
securities by Topco to Parentco, excluding issuances:
-- by one wholly-owned member of the Topco Group to another
wholly-owned member of the Topco Group;
-- to Parentco and/or its associates to finance the Acquisition;
-- to eligible Proactis Shareholders pursuant to the Scheme
and/or the Rollover in connection with the Acquisition;
-- in connection with issuances to or incentivisation for actual
or potential employees, directors or consultants (whether directly
or indirectly) which will dilute the holders of Topco Ordinary
Shares and Alternative Offer Securities pro rata;
-- other than to Parentco or its associates, for non-cash
consideration on the acquisition of, or merger with, all or part of
another business, undertaking, company or assets which will dilute
the holders of Topco Ordinary Shares and Alternative Offer
Securities pro rata;
-- other than to Parentco or its associates, in connection with
the debt financing arrangements of the Topco Group which will
dilute the holders of Topco Ordinary Shares and Alternative Offer
Securities pro rata;
-- in connection with an IPO or a pre-IPO reorganisation; or
-- in respect of which Parentco and the holders of a majority of
the Alternative Offer Securities give their prior written consent
to pre-emption rights not applying.
7. TERMS OF ALTERNATIVE OFFER IN THE EVENT OF A SWITCH
In the event that Bidco elects, with the consent of the Panel
and subject to the Co-operation Agreement, to switch to an Offer,
and less than 100 per cent. of the Proactis Shares are acquired by
Bidco on or around the date of such Offer becoming wholly
unconditional, the total number of Alternative Offer Securities to
be issued to eligible Proactis Shareholders who elect for the
Alternative Offer and Topco Ordinary Shares to be issued to
Parentco will be reduced (and in the same proportions as between
Topco Ordinary Shares and Alternative Offer Securities such that
the maximum number of Alternative Offer Securities available to
eligible Proactis Shareholders under the Alternative Offer will
remain a number equal to 24.9 per cent. of the total ordinary share
capital of Topco in issue at such time).
In that event, if elections for the Alternative Offer are unable
to be satisfied in full as a result, the number of Alternative
Offer Securities available for each Proactis Share will be reduced
on a pro rata proportional basis and the balance of the
consideration for each Proactis Share will be paid in cash in
accordance with the terms of the Cash Offer.
If: (i) further Proactis Shares are acquired for cash by or on
behalf of Bidco after the Offer becomes wholly unconditional (under
the compulsory acquisition procedure or otherwise); and (ii) the
Topco Ordinary Shares to be issued to fund those acquisitions were
not included in the calculation of the above 24.9 per cent.
entitlement of eligible Proactis Shareholders who elect for the
Alternative Offer, then the holders of Alternative Offer Securities
shall be entitled to customary "catch-up" pre-emption rights in
relation to any such additional issue of Topco Ordinary Shares in
order to maintain their percentage shareholdings in Topco.
8. INFORMATION RIGHTS
Any holder of Alternative Offer Securities that holds 10 per
cent. or more of the issued ordinary share capital of Topco shall
have the right to receive the Topco Group's annual audited accounts
and unaudited half-yearly interim accounts.
9. EXIT ARRANGEMENTS
Any future share sale, asset sale, IPO, winding-up or other form
of liquidity event relating to the Topco Group (an "Exit") shall
occur at the absolute discretion of Parentco.
All holders of Alternative Offer Securities are required to
co-operate and take such actions in respect of any proposed Exit as
are reasonably requested by the Topco Group or Parentco. This shall
include without limitation: any reorganisation, restructuring or
other corporate (or similar) action required to facilitate such
Exit; providing warranties but only as to the title to the
Alternative Offer Securities held by such holder and its capacity
to transfer such Alternative Offer Securities; and, in the case of
an IPO, entering into customary "lock-up" undertakings.
10. DRAG-ALONG AND TAG-ALONG
Parentco shall have a right to "drag along" up to all
Alternative Offer Securities on the same economic terms on any
transfers of direct or indirect shareholdings in shares of Topco by
Parentco to a bona fide purchaser which is not connected with
Parentco if, following such transfer, the purchaser would
thereafter directly or indirectly hold a majority of the ordinary
shares of Topco. Parentco will also have customary drag rights in
connection with a proposed IPO of Topco or any newly incorporated
company established in connection with such IPO.
Holders of the Alternative Offer Securities shall have a "pro
rata" tag right on the same economic terms on any transfer of
direct or indirect shareholdings in Topco shares by Parentco to a
bona fide purchaser which is not connected with Parentco if,
following such transfer, the purchaser would thereafter directly or
indirectly hold a majority of the ordinary shares of Topco.
11. GOVERNING LAW
The Topco Shareholders' Agreement and any non-contractual
obligations arising out of or in connection with them shall be
governed by English law. The courts of England and Wales shall have
exclusive jurisdiction to settle any dispute which may arise out of
or in connection with the Topco Shareholders' Agreement and
accordingly any proceedings arising out of or in connection with
the Topco Shareholders' Agreement shall be brought in such
courts.
APPIX 5
DEFINITIONS
"2020 Proactis Annual Report" the annual report and audited accounts
of Proactis for the year ended 31
July 2020;
"Acquisition" the proposed acquisition of the
entire issued and to be issued share
capital of Proactis by Bidco, to
be effected by the Scheme as described
in this announcement (or by the
Offer under certain circumstances
described in this announcement);
"AIM" the market of that name operated
by the London Stock Exchange;
"AIM Rules" the AIM Rules for Companies published
by the London Stock Exchange from
time to time;
"Alternative Offer" the alternative to the Cash Offer
pursuant to which eligible Proactis
Shareholders may elect to receive
0.75 Alternative Offer Securities
in exchange for each Proactis Share,
the terms and conditions of which
will be set out in the Scheme Document;
"Alternative Offer Maximum" has the meaning set out in paragraph
13;
"Alternative Offer Securities" the ordinary shares in the capital
of Topco to be issued to eligible
Proactis Shareholders who elect
to receive the Alternative Offer,
the terms of which are summarised
at Appendix 4 to this announcement
and which will be set out in full
in the Scheme Document and the Topco
Articles;
"AMF" Autorité des marchés financiers,
the French financial markets authority;
"AO Cash Threshold" has the meaning set out in paragraph
13;
"Authorisations" regulatory authorisations, orders,
recognitions, grants, consents,
clearances, confirmations, certificates,
licences, permissions or approvals;
"Bidco" Cafe Bidco Limited, incorporated
in England and Wales with registered
number 13346628;
"Blocking Law" (i) any provision of Council Regulation
(EC) No 2271/1996 of 22 November
1996 (or any law or regulation implementing
such Regulation in any member state
of the European Union or the United
Kingdom); or (ii) any similar blocking
or anti-boycott law;
"Business Day" a day, (other than a Saturday, Sunday
or public holiday in England) on
which banks are generally open for
business in London;
"Cash Offer" 75 pence in cash for each Proactis
Share;
"CMA" the UK Competition and Markets Authority
of the United Kingdom;
"CMA Phase 2 Reference" a reference of the Acquisition to
the chair of the CMA for the constitution
of a group under schedule 4 to the
Enterprise and Regulatory Reform
Act 2013;
"Companies Act 2006" the UK Companies Act 2006 (as amended
from time to time);
"Conditions" the conditions to the implementation
of the Acquisition, as set out in
Appendix 1 to this announcement
and to be set out in the Scheme
Document;
"Confidentiality Agreement" has the meaning given to it in paragraph
10.1 of this announcement;
"Convertible Loan Notes" the outstanding (i) USD 3,750,000
2 per cent. convertible unsecured
loan notes due 8 July 2022; (ii)
EUR 3,000,000 3 per cent. convertible
unsecured loan notes due 6 August
2023; and (iii) EUR 1,000,000 3
per cent. convertible unsecured
loan notes due 6 November 2024,
in each case issued by Proactis;
"Co-operation Agreement" has the meaning given to it in paragraph
10.2 of this announcement;
"Court" the High Court of Justice in England
and Wales;
"Court Meeting" the meeting or meetings of the Proactis
Shareholders (or any class or classes
thereof) to be convened by order
of the Court pursuant to section
899 of the Companies Act 2006 (notice
of which will be set out in the
Scheme Document) for the purpose
of considering and, if thought fit,
approving the Scheme (with or without
amendment) and any adjournment,
postponement or reconvention thereof;
"CREST" the relevant system (as defined
in the Uncertificated Securities
Regulations 2001 (SI 2001/3755))
in respect of which Euroclear UK
& Ireland Limited is the Operator
(as defined in those Regulations)
in accordance with which securities
may be held and transferred in uncertificated
form;
"Dealing Disclosure" has the same meaning as in Rule
8 of the Takeover Code;
"Disclosed" the information disclosed by or
on behalf of Proactis: (i) in the
2020 Proactis Annual Report; (ii)
in this announcement; (iii) in any
other announcement to a Regulatory
Information Service prior to the
publication of this announcement;
(iv) fairly disclosed in writing
(including via the virtual data
room operated by or on behalf of
the Proactis in respect of the Acquisition)
prior to the date of this announcement
to Bidco or Bidco's advisers (in
their capacity as such);
"Disclosure Guidance and the disclosure guidance and transparency
Transparency Rules" rules made by the FCA and forming
part of the FCA's handbook of rules
and guidance, as amended from time
to time;
"Effective" in the context of the Acquisition:
(i) if the Acquisition is implemented
by way of the Scheme, the Scheme
having become effective pursuant
to its terms; or (ii) if the Acquisition
is implemented by way of the Offer,
the Offer having been declared or
having become unconditional in all
respects in accordance with the
requirements of the Takeover Code;
"Effective Date" the date on which the Scheme becomes
Effective;
"Equity Commitment Letter" the equity commitment letter entered
into between the PSC Funds, on the
one hand, and Bidco, on the other
hand, dated 30 April 2021;
"FCA" the UK Financial Conduct Authority;
"finnCap" finnCap Ltd;
"FSMA" the Financial Services and Markets
Act 2000 (as amended from time to
time);
"General Meeting" the general meeting of Proactis
Shareholders (including any adjournment
thereof) to be convened in connection
with the Scheme for the purpose
of considering and, if thought fit,
approving, inter alia, the Special
Resolutions;
"Houlihan Lokey" Houlihan Lokey (Corporate Finance)
Limited;
"HSBC" HSBC Bank PLC;
"IPO" initial public offering;
"London Stock Exchange" London Stock Exchange plc;
"Long Stop Date" 30 October 2021 or such later date
as may be agreed in writing by Bidco
and Proactis (with the Panel's consent
and as the Court may approve (if
such approval(s) is or are required));
"Market Abuse Regulation" the UK version of the Market Abuse
Regulation (EU) No 596/2014, which
came into effect on 1 January 2021
when the EU Market Abuse Regulation
(EU) No 596/2014 was incorporated
into UK domestic law by the European
Union (Withdrawal) Act 2018, with
certain modifications;
"Meetings" the Court Meeting and the General
Meeting and, where the context permits,
each of them;
"Offer" if, subject to the consent of the
Panel and the terms of the Co-operation
Agreement, the Acquisition is implemented
by way of a takeover offer as defined
in Chapter 3 of Part 28 of the Companies
Act 2006, the offer to be made by
or on behalf of Bidco to acquire
the entire issued and to be issued
ordinary share capital of Proactis
and, where the context admits, any
subsequent revision, variation,
extension or renewal of such offer;
"Offer Document" should the Acquisition be implemented
by means of the Offer, the document
to be published by or on behalf
of Bidco in connection with the
Offer, containing, inter alia, the
terms and conditions of the Offer;
"Offer Period" the Offer Period (as defined by
the Takeover Code) relating to Proactis
commencing on the date of this announcement
and ending on the earlier of the
date on which the Scheme becomes
Effective and/or the date on which
the Scheme lapses or is withdrawn
(or such other date as the Panel
may decide);
"Opening Position Disclosure" has the same meaning as in Rule
8 of the Takeover Code;
"Overseas Shareholders" Proactis Shareholders who are resident
in, ordinarily resident in, or citizens
of, jurisdictions outside the United
Kingdom;
"Panel" the Panel on Takeovers and Mergers;
"Parentco" Cafe Parentco Limited, a private
company incorporated in England
and Wales with company number 13328295;
"Pollen Street Capital" Pollen Street Capital Limited, a
private company incorporated in
England and Wales with company number
08741640;
"Proactis" Proactis Holdings plc, a public
company incorporated in England
and Wales with registered number
05752247;
"Proactis Directors" the directors of Proactis as at
the date of this announcement or,
where the context so requires, the
directors of Proactis from time
to time;
"Proactis Group" Proactis and its subsidiary undertakings
and, where the context permits,
each of them;
"Proactis SA" Proactis SA, listed on Euronext
Paris under the symbol PROAC;
"Proactis Shareholders" the holders of Proactis Shares;
"Proactis Shares" the existing unconditionally allotted
or issued fully paid ordinary shares
of 10 pence each in the capital
of Proactis and any further such
ordinary shares which are unconditionally
allotted or issued before the Scheme
becomes Effective;
"Proactis Share Plans" each of: (i) the Proactis Group
Long-Term Incentive Plan 2020, adopted
by the board of Proactis on 27 January
2021; and (ii) the Proactis Holdings
Enterprise Management Incentive
Scheme, whose rules are dated 26
May 2006;
"PSC Funds" (i) PSC IV LP, a limited partnership
registered in Guernsey with number
3357; (ii) PSC IV (B) LP, a limited
partnership registered in Guernsey
with number 3387; and (iii) PSC
IV (C) SCsp, a limited partnership
registered in Luxembourg with number
B237673;
"Registrar of Companies" the Registrar of Companies in England
and Wales;
"Regulatory Information has the same meaning as in the AIM
Service" Rules;
"Restricted Jurisdiction" any jurisdiction where local laws
or regulations may result in a significant
risk of civil, regulatory or criminal
exposure if information concerning
the Acquisition is sent or made
available to Proactis Shareholders
in that jurisdiction;
"Scheme" the proposed scheme of arrangement
under Part 26 of the Companies Act
2006 between Proactis and Proactis
Shareholders to implement the Acquisition,
with or subject to any modification,
addition or condition approved or
imposed by the Court and agreed
to by Proactis and Bidco;
"Scheme Court Hearing" the hearing of the Court to sanction
the Scheme pursuant to section 899
of the Companies Act 2006 and any
adjournment, postponement or reconvening
thereof;
"Scheme Court Order" the order of the Court sanctioning
the Scheme under section 899 of
the Companies Act 2006;
"Scheme Document" the document to be dispatched to
Proactis Shareholders and persons
with information rights setting
out, among other things, the details
of the Acquisition, the full terms
and conditions of the Scheme and
containing the notices convening
the Court Meeting and the General
Meeting;
"Scheme Record Time" the time and date specified as such
in the Scheme Document, expected
to be 6.00 p.m. on the Business
Day immediately prior to the Effective
Date, or such other time as Proactis
and Bidco may agree;
"Scheme Shareholder" a holder of Scheme Shares;
"Scheme Shares" (i) the Proactis Shares in issue
at the date of the Scheme Document;
(ii) any Proactis Shares issued
after the date of the Scheme Document
and prior to the Scheme Voting Record
Time; and
(iii) any Proactis Shares issued
at or after the Scheme Voting Record
Time and prior to the Scheme Record
Time in respect of which the original
or any subsequent holder thereof
is bound by the Scheme, or shall
by such time have agreed in writing
to be bound by the Scheme;
"Scheme Voting Record Time" the date and time specified in the
Scheme Document by reference to
which entitlement to vote at the
Court Meeting will be determined,
expected to be 6.00 p.m. (London
time) on the day which is two days
before the Court Meeting or, if
the Court Meeting is adjourned,
6.00 p.m. (London time) on the day
which is two days before the date
of such adjourned Court Meeting;
"Significant Interest" in relation to an undertaking, a
direct or indirect interest of 20
per cent. or more of the total voting
rights conferred by the equity share
capital of such undertaking;
"Special Resolutions" such shareholder resolutions of
Proactis as are necessary to enable
Proactis to approve, implement and
effect the Scheme and the Acquisition,
including (without limitation) a
resolution to amend the articles
of association of Proactis by the
adoption and inclusion of a new
article under which any Proactis
Shares issued or transferred after
the General Meeting shall either
be subject to the Scheme or (after
the Effective Date) be immediately
transferred to Bidco (or as it may
direct) in exchange for the same
consideration as is due under the
Scheme;
"Takeover Code" the City Code on Takeovers and Mergers
of the UK issued by the Panel, as
amended from time to time;
"Topco" Cafe Topco Limited, a private company
incorporated in England and Wales
with company number 13340672;
"Topco Articles" the articles of association of Topco;
"Topco Group" Topco and its subsidiary undertakings
and where the context permits, each
of them;
"Topco Ordinary Shares" the ordinary shares in the capital
of Topco to be issued to Parentco;
"Topco Shareholders' Agreement" the shareholders' agreement to entered
into by the holders of securities
of Topco;
"UK" or "United Kingdom" the United Kingdom of Great Britain
and Northern Ireland;
"US" or "United States" the United States of America, its
territories and possessions, any
state of the United States of America
and the District of Columbia;
"US Exchange Act" US Securities Exchange Act of 1934
(as amended), and the rules and
regulations promulgated thereunder;
"US Securities Act" US Securities Act of 1933 (as amended),
and the rules and regulations promulgated
thereunder;
"Wider Bidco Group" Bidco and its subsidiaries, subsidiary
undertakings, associated undertakings
and any other body corporate, partnership,
joint venture or person in which
Bidco and/or such subsidiaries or
undertakings (aggregating their
interests) have a Significant Interest;
and
"Wider Proactis Group" Proactis and its subsidiaries, subsidiary
undertakings, associated undertakings
and any other body corporate, partnership,
joint venture or person in which
Proactis and/or such subsidiaries
or undertakings (aggregating their
interests) have a Significant Interest.
For the purposes of this announcement:
-- "subsidiary", "subsidiary undertaking" and "undertaking" have
the respective meanings given by the Companies Act 2006 and
"associated undertaking" has the meaning given by paragraph 19 of
Schedule 6 to the Large and Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008 (other than paragraph
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OFFDKKBPQBKDFQN
(END) Dow Jones Newswires
April 30, 2021 11:00 ET (15:00 GMT)
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