TIDMTTR
RNS Number : 8239X
32Red Plc
24 February 2017
32Red Plc
("32Red" or '"the Company")
Notification pursuant to AIM Rule 20
Posting of offer announcement
In accordance with AIM Rule 20, following the announcement by
Kindred Group Plc on 23 February 2017 regarding a recommended cash
offer for the Company (the "Announcement"), 32Red confirms that a
copy of the Announcement has been posted to all shareholders of the
Company.
The Announcement is available to view on the Company's website
http://www.32redplc.com/ and is also set out below.
Enquiries:
32Red Plc Tel: +00 350 200
49396
Ed Ware, CEO
Jon Hale, CFO
Numis Securities Limited Tel: +44 (0) 20 7260
1000
Michael Meade (Nominated Adviser)
Richard Thomas (Corporate Broking
& Advisory)
Michael Burke (Corporate Broking
& Advisory)
Hudson Sandler Tel: +44 (0) 207
796 4133
Alex Brennan 32Red@hudsonsandler.com
Bertie Berger
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION.
EMBARGOED UNTIL 7.00 A.M.
Thursday 23 February 2017
RECOMMED CASH OFFER (the "Offer")
for
32Red plc ("32Red")
by
Kindred Group plc ("Kindred")
Summary
-- The boards of Kindred and 32Red are pleased to announce that
they have reached agreement on the terms of a recommended cash
offer pursuant to which Kindred will offer to acquire the entire
issued and to be issued share capital of 32Red. The Offer is
intended to be implemented by means of a Takeover Offer, further
details of which are contained in the full text of this
announcement.
-- Under the terms of the Offer, 32Red Shareholders will be entitled to receive:
for each 32Red Share 196 pence.
-- 32Red Shareholders as at the record date of 3 March 2017 will
also be entitled to receive and retain a second interim dividend
per 32Red Share of 4 pence (the "Approved Dividend"), to be paid to
32Red Shareholders on 23 March 2017.
-- The Offer provides an attractive opportunity for 32Red
Shareholders to realise their holding of 32Red Shares at a premium
in cash. The Offer values the entire issued and to be issued share
capital of 32Red on a fully diluted basis at approximately GBP175.6
million.
-- The Offer, together with the Approved Dividend, represents a premium of approximately:
- 16.3 per cent. to the closing price per 32Red Share of 172.0
pence on 22 February 2017 (being the last Business Day before the
date of this announcement);
- 32.4 per cent. to the volume weighted average closing price
per 32Red Share of 151.1 pence in the one month prior to the date
of this announcement;
- 39.5 per cent. to the volume weighted average closing price
per 32Red Share of 143.4 pence in the three months prior to the
date of this announcement; and
- 42.5 per cent. to the volume weighted average closing price
per 32Red Share of 140.3 pence in the six months prior to the date
of this announcement.
-- The cash consideration payable under the Offer (which for the
avoidance of doubt does not include the Approved Dividend which is
payable by 32Red) will be funded by new senior debt acquisition
facilities, specifically for the purposes of the Transaction,
provided by Swedbank.
-- The 32Red Directors, who have been so advised by Numis as to
the financial terms of the Offer, consider the terms of the Offer
to be fair and reasonable. In providing advice to the 32Red
Directors, Numis has taken into account the commercial assessments
of the 32Red Directors.
-- Accordingly, the 32Red Directors intend unanimously to
recommend that 32Red Shareholders accept or procure acceptance of
the Offer (or, in the event that the Offer is implemented by way of
a Scheme, vote in favour of the resolutions relating to such
Scheme), as the 32Red Directors have irrevocably undertaken to do
in respect of their own beneficial holdings of 36,993,281 32Red
Shares representing, in aggregate, approximately 43.3 per cent. of
the share capital of 32Red in issue on 22 February 2017 (being the
latest practicable date prior to the publication of this
announcement).
-- Furthermore, Kindred has received irrevocable undertakings
from other 32Red Shareholders in respect of an aggregate of
23,707,951 32Red Shares, representing approximately 27.8 per cent.
of the share capital of 32Red in issue on 22 February 2017 (being
the latest practicable date prior to the publication of this
announcement) to accept (or procure the acceptance of) the Offer
(or, in the event that the Offer is implemented by way of a Scheme,
vote in favour of the resolutions relating to such Scheme).
-- Accordingly, Kindred has received irrevocable undertakings to
accept (or procure acceptance of) the Offer in relation to an
aggregate of 60,701,232 32Red Shares, representing approximately
71.1 per cent. of the share capital of 32Red in issue on 22
February 2017 (being the latest practicable date prior to the
publication of this announcement). With the exception of the
undertaking given by Miton Asset Management, each of the
irrevocable undertakings are given in terms such that they will
continue to be binding (and will not lapse) even in the event of a
new offer for 32Red being made or announced by a third party. The
undertaking given by Miton Asset Management will lapse if (i) the
Offer is withdrawn or lapses and no new, revised or replacement
Offer is announced at the same time; or (ii) a third party makes a
competing offer for the entire issued share capital of 32Red at a
value which (in 32Red's reasonable opinion on the advice of Numis)
exceeds the value of the consideration offered under the terms of
the Offer by 10% or more per 32Red Share. Further details of these
irrevocable undertakings are set out in Appendix III to this
announcement.
-- Kindred is one of the world's largest online gaming and
sports betting companies with over 15 million customers across 100
markets. Kindred's core B2C offerings are in Europe and Australia,
with customers in most global markets. The acquisitions of the Stan
James online business and iGame in 2015 have made Kindred one of
Europe's leading online gambling providers.
-- The Offer will be subject to the Conditions and further terms
set out in Appendix I to this announcement, including the receipt
by Kindred of valid acceptances in respect of, or otherwise
acquiring or agreeing to acquire (whether pursuant to the Offer or
otherwise), shares which constitute not less than 75 per cent. (or
such lesser percentage as Kindred may decide, but such percentage
not being less than 50 per cent. plus one share) in nominal value
of the 32Red Shares.
-- The Offer Document and Form of Acceptance, containing further
information about the Offer, will be sent to 32Red Shareholders as
soon as practicable (and, in any event, within 28 days of the date
of this announcement or such later date as Kindred and 32Red may
agree otherwise) and will be made available by Kindred on its
website at www.kindredplc.com/ and by 32Red on its website at
www.32Redplc.com/.
Commenting on the Offer, Ed Ware of 32Red, said:
"We have consistently and profitably grown 32Red's market share
in the regulated markets of the UK and more recently, Italy. The
management team at Kindred have a similar business philosophy to
our own and we look forward to joining forces with Kindred and
continuing our successful growth within the Kindred Group."
Commenting on the Offer, Henrik Tjärnström of Kindred, said:
"The acquisition of 32Red is consistent with our multi-brand
strategy and stated desire to grow our business in regulated and
soon to be regulated markets. 32Red is a high quality,
customer-focused business with a similar culture to Kindred's and
we are delighted to welcome 32Red and its team into the Kindred
Group and look forward to further developing the brand going
forward."
Analyst and investor call
Kindred will host a conference call on 23 February 2017 to
discuss the acquisition of 32Red. The call will begin at 09:30 a.m.
CET and the numbers to use are as follows:
+44 20 3008 9813
+46 8 5664 2690
Subject to certain restrictions, the recorded call will be
available to all interested parties on the "Investors" section of
the Kindred website at www.kindredplc.com/.
This summary should be read in conjunction with, and is subject
to, the full text of this announcement (including its Appendices).
The Offer will be subject to the Conditions and further terms set
out in Appendix I to this announcement and to the full terms and
conditions to be set out in the Offer Document and the Form of
Acceptance.
Appendix II to this announcement contains further details of the
sources of information and bases of calculations set out in this
announcement. Appendix III contains a summary of the irrevocable
undertakings received in relation to the Offer. Appendix IV
contains definitions of certain expressions used in this summary
and this announcement.
Enquiries:
Kindred Group plc
+46 (0) 723 878
Henrik Tjärnström 059
+44 (0) 788 799
Inga Lundberg 6116
Houlihan Lokey (Financial adviser
to Kindred)
+44 (0) 20 7839
George Fleet 3355
Panmure Gordon (Broker to Kindred)
+44 (0) 20 7886
Ben Thorne 2500
Erik Anderson
32Red plc +00 350 200 49396
Ed Ware
Jon Hale
Numis (Financial adviser, nominated +44 (0) 20 7260
adviser and broker to 32Red) 1000
Michael Meade
Richard Thomas
Michael Burke
Important Notices
Houlihan Lokey EMEA, LLP which is authorised and regulated in
the United Kingdom by the Financial Conduct Authority, is acting
exclusively for Kindred and no-one else in connection with the
subject matter of this announcement, and will not be responsible to
anyone other than Kindred for providing the protections afforded to
clients of Houlihan Lokey EMEA, LLP, nor for giving advice in
relation to the subject matter of this announcement. Neither
Houlihan Lokey EMEA, LLP, 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 EMEA, LLP, in connection with this announcement, any
statement contained herein or otherwise.
Panmure Gordon (UK) Limited, which is authorised and regulated
by the Financial Conduct Authority in the United Kingdom, is acting
exclusively for Kindred and no-one else in connection with the
matters set out in this announcement, and will not be responsible
to anyone other than Kindred for providing the protections afforded
to clients of Panmure Gordon (UK) Limited nor for giving advice in
relation to the subject matter of this announcement.
Numis Securities Limited, which is authorised and regulated by
the Financial Conduct Authority in the United Kingdom, is acting
exclusively for 32Red and no-one else in connection with the
subject matter of this announcement, and will not be responsible to
anyone other than 32Red for providing the protections afforded to
clients of Numis Securities Limited, nor for giving advice in
relation to the subject matter of this announcement.
The City Code on Takeovers and Mergers
By virtue of its status as a Gibraltar incorporated company, the
Code does not apply to 32Red. Accordingly, 32Red Shareholders are
reminded that the Panel does not have responsibility, in relation
to 32Red, for ensuring compliance with the Code and is not able to
answer 32Red Shareholders' queries. In accordance with 32Red's
articles of association, 32Red and Kindred confirm in this
announcement that, to implement the Offer, they will observe and
comply with the provisions of the Code as if 32Red (and therefore
the Offer) were subject to the Code. Further details are set out in
the full text of this announcement.
In particular, public disclosures consistent with the provisions
of Rule 8 of the Code (as if it applied to 32Red) should not be
emailed to the Panel, but, as described below, released directly
through a Regulatory Information Service.
Further Information
This announcement is for information purposes only and is not
intended to, and does not, constitute or form part of any offer,
invitation or solicitation of any offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any securities
or the solicitation of any vote or approval in any jurisdiction,
pursuant to the Offer or otherwise, nor shall there be any sale,
issuance, or transfer of securities in any jurisdiction in
contravention of applicable law.
The Offer will be made solely by means of the Offer Document
and, in respect of the 32Red Shares held in certificated form, the
Form of Acceptance, which will contain the full terms and
Conditions of the Offer, including details of how the Offer may be
accepted. Any decision in respect of, or other response to, the
Offer should be made only on the basis of the information contained
in those documents. 32Red Shareholders are advised to read the
formal documentation in relation to the Offer carefully once it has
been dispatched.
This announcement has been prepared for the purpose of complying
with applicable English and Gibraltar law and applicable securities
laws and the information disclosed may not be the same as that
which would have been disclosed if this announcement had been
prepared in accordance with the laws of jurisdictions outside the
United Kingdom and Gibraltar.
Overseas Shareholders
The release, publication or distribution of this announcement in
certain jurisdictions may be restricted by law. Persons who are not
resident in the United Kingdom or Gibraltar or who are subject to
other jurisdictions should inform themselves of, and observe, any
applicable requirements. Any failure to comply with these
requirements 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 Offer
disclaim any responsibility or liability for the violation of such
requirements by any person.
US 32Red Shareholders should note that the Offer relates to the
securities of a Gibraltar company which are admitted to trading on
AIM, is subject to applicable Gibraltar and UK procedural and
disclosure requirements (which are different from those of the US)
and is proposed to be implemented under a takeover offer under
applicable Gibraltar law and in accordance with the Code (as if it
applied to 32Red, and therefore the Offer). Accordingly, the Offer
will be subject to any applicable Gibraltar procedural and
disclosure requirements and practices, which are different from the
procedural and disclosure requirements of the US tender offer rules
under the United States Exchange Act. The financial information
with respect to 32Red included in this announcement and the Offer
documentation has been or will have been prepared in accordance
with IFRS and thus may not be comparable to financial information
of US companies or companies whose financial statements are
prepared in accordance with generally accepted accounting
principles in the US.
Unless otherwise determined by Kindred and permitted by
applicable law and regulation, the Offer 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 accept the Offer by any such use,
means, instrumentality or form 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 all documents relating to the Offer are not being,
and must not be, directly or indirectly, mailed or otherwise
forwarded, distributed or sent in, into or from a Restricted
Jurisdiction where to do so would violate the laws in that
jurisdiction, and persons receiving this announcement and all
documents relating to the Offer (including custodians, nominees and
trustees) must not mail or otherwise distribute or send them in,
into or from such jurisdictions where to do so would violate the
laws in that jurisdiction.
The availability of the Offer to 32Red Shareholders who are not
resident in the United Kingdom or Gibraltar may be affected by the
laws of the relevant jurisdictions in which they are resident.
Persons who are not resident in the United Kingdom or Gibraltar
should inform themselves of, and observe, any applicable
requirements.
Forward Looking Statements
This announcement contains statements about Kindred and 32Red
that are or may be forward looking statements. All statements other
than statements of historical facts included in this announcement
may be forward looking statements. Without limitation, any
statements preceded or followed by or that include the words
"targets", "plans", "believes", "expects", "aims", "intends",
"will", "may", "anticipates", "estimates", "projects" or words or
terms of similar substance or the negative thereof, are forward
looking statements. Forward looking statements include statements
relating to the following: (i) future capital expenditures,
expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the
expansion and growth of Kindred's or 32Red's operations and
potential synergies resulting from the Offer; and (iii) the effects
of government regulation on Kindred's or 32Red's business.
Such forward looking statements involve risks and uncertainties
that could significantly affect expected results and are based on
certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any forward
looking statements. Due to such uncertainties and risks, readers
are cautioned not to place undue reliance on such forward looking
statements, which speak only as of the date hereof. Each of Kindred
and 32Red disclaims any obligation to update any forward looking or
other statements contained herein, except as required by applicable
law.
No profit forecasts or estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for Kindred or 32Red, as appropriate, for the
current or future financial years would necessarily match or exceed
the historical published earnings or earnings per share for Kindred
or 32Red, as appropriate.
Disclosure requirements
32Red is a Gibraltar company and is therefore not subject to the
Code. Accordingly, shareholders of 32Red and others dealing in
32Red Shares are not obliged to disclose any of their dealings
under the provisions of the Code. However, market participants are
requested to make disclosure of dealings as if the Code applied and
as if 32Red were in an "offer period" under the Code. 32Red
Shareholders and persons considering the acquisition or disposal of
any interest in 32Red Shares are reminded that they are subject to
the Disclosure Guidance and Transparency Rules made by the UKLA and
other applicable regulatory rules regarding transactions in 32Red
Shares.
If you are in any doubt as whether or not you should disclose
dealings, you should contact an independent financial adviser
authorised by the Financial Conduct Authority under the FSMA (or,
if you are resident in a jurisdiction other than the United
Kingdom, a financial adviser authorised under the laws of such
jurisdiction).
In light of the foregoing, as provided in Rule 8.3(a) of the
Code, any person who is "interested" in one per cent. or more of
any class of "relevant securities" of 32Red 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") is requested to make an Opening
Position Disclosure following the commencement of the "offer
period" which begins upon the release of this announcement.
An Opening Position Disclosure should contain details of the
person's interests and short positions in, and rights to subscribe
for, any "relevant securities" of each of (i) 32Red and (ii)
Kindred. Persons to whom Rule 8.3(a) would have applied had the
Code been applicable are requested to make an Opening Position
Disclosure by no later than 3:30 p.m. (London time) on the tenth
Business Day following the commencement of the "offer period" which
begins upon the release of this announcement. Relevant persons who
undertake "dealings" in the relevant securities of 32Red or a
"securities exchange offeror" prior to the deadline for making an
Opening Position Disclosure are requested instead to make a Dealing
Disclosure.
Rule 8.3(b) of the Code provides that if any person is, or
becomes "interested" (directly or indirectly) in one per cent. or
more of any class of "relevant securities" of an offeree or of any
"securities exchange offeror", all "dealings" in any "relevant
securities" of that offeree or of any "securities exchange offeror"
(including by means of an option in respect of, or a derivative
referenced to, any such "relevant securities") should be publicly
disclosed in a Dealing Disclosure by no later than 3:30 p.m.
(London time) on the Business Day following the date of the
relevant transaction. In a situation where the Code applies, this
requirement would continue until the date on which any "offer"
becomes, or is declared, unconditional as to acceptances, lapses or
is otherwise withdrawn or on which the "offer period" otherwise
ends. Under Rule 8 of the Code, a Dealing Disclosure would 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 (i) 32Red and (ii) any "securities exchange
offeror", save to the extent that these details have previously
been disclosed under Rule 8.
Accordingly, in the case of both an Opening Position Disclosure
and Dealing Disclosure (if any), disclosures of interests in the
shares of 32Red are requested to be made.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire an "interest"
in "relevant securities" of 32Red or a "securities exchange
offeror", they would, if the Code were applicable, be deemed to be
a single person for the purpose of Rule 8.3 of the Code.
Consistent with the provisions of Rule 8.1 of the Code, Opening
Position Disclosures should be made by 32Red and by any "offeror",
and all "dealings" in "relevant securities" of 32Red by 32Red, by
any "offeror" or by any persons "acting in concert" with any of
them, should be disclosed in a Dealing Disclosure by no later than
12 noon (London time) on the Business Day following the date of the
relevant transaction.
"Interests in securities" arise, in summary, when a person has
long economic exposure, whether conditional or absolute, to changes
in the price of "securities". In particular, a person will be
treated as having an "interest" by virtue of the ownership or
control of "securities", or by virtue of any option in respect of,
or derivative referenced to, "securities".
Terms in quotation marks are defined in the Code, which can be
found on the Panel's website. If you are in any doubt as to whether
not you should disclose a "dealing" by reference to the above, you
should contact an independent financial adviser authorised by the
FCA under the FSMA.
It should be noted that, for the purposes of the above summary
of Rule 8 of the Code, Kindred is not treated as a "securities
exchange offeror" and therefore there is no requirement to disclose
interests or dealings in shares of Kindred.
Electronic Communications
Please be aware that addresses, electronic addresses and certain
information provided by 32Red Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from 32Red may be provided to Kindred during the
Offer Period as requested under Section 4 of Appendix 4 of the Code
to comply with Rule 2.12(c) of the Code.
Publication on Website and Availability of Hard Copies
A copy of this announcement will be made available, subject to
certain restrictions relating to persons resident in Restricted
Jurisdictions, on Kindred's and 32Red's websites at
www.kindredplc.com/ and www.32Redplc.com/ respectively by no later
than 12 noon (London time) on the Business Day following this
announcement. For the avoidance of doubt, the contents of those
websites are not incorporated and do not form part of this
announcement.
A hard copy of this announcement will be sent by 32Red to 32Red
Shareholders and persons with information rights (other than such
32Red Shareholders or persons with information rights who have
elected to receive electronic communications) in accordance with
the requirements of the Code.
You may request a hard copy of this announcement by contacting
the Company Secretary of 32Red by submitting a request in writing
to the Company Secretary at 32 Red plc, 741 Europort, Gibraltar.
You may also request that all future documents, announcements and
information to be sent to you in relation to the Offer should be in
hard copy form.
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 the figures that precede them.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM THE UNITED STATES OR
ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION
OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.
EMBARGOED UNTIL 7.00 A.M.
Thursday 23 February 2017
RECOMMED CASH OFFER (the "Offer")
for
32Red plc ("32Red")
by
Kindred Group plc ("Kindred")
1. Introduction
The boards of Kindred and 32Red are pleased to announce that
they have reached agreement on the terms of a recommended cash
offer pursuant to which Kindred will offer to acquire the entire
issued and to be issued ordinary share capital of 32Red. It is
intended that the Offer be implemented by means of a Takeover
Offer, further details of which are set out below.
2. The Offer
Under the terms of the Offer, which will be subject to the
Conditions and further terms set out in Appendix I to this
announcement and to be set out in the Offer Document, 32Red
Shareholders will be entitled to receive:
for each 32Red Share 196 pence.
32Red Shareholders as at the record date of 3 March 2017 will
also be entitled to receive and retain a second interim dividend
per 32Red Share of 4 pence (the "Approved Dividend"), to be paid to
32Red Shareholders on 23 March 2017.
The Offer values the entire issued and to be issued share
capital of 32Red on a fully diluted basis at approximately GBP175.6
million.
The Offer, together with the Approved Dividend, represents a
premium of approximately:
- 16.3 per cent. to the closing price per 32Red Share of 172.0
pence on 22 February 2017 (being the last Business Day before the
date of this announcement);
- 32.4 per cent. to the volume weighted average closing price
per 32Red Share of 151.1 pence in the one month prior to the date
of this announcement;
- 39.5 per cent. to the volume weighted average closing price
per 32Red Share of 143.4 pence in the three months prior to the
date of this announcement; and
- 42.5 per cent. to the volume weighted average closing price
per 32Red Share of 140.3 pence in the six months prior to the date
of this announcement.
The Offer will be subject to the Conditions and further terms
set out in Appendix I to this announcement, including the receipt
by Kindred of valid acceptances in respect of, or otherwise
acquiring or agreeing to acquire (whether pursuant to the Offer or
otherwise), shares which constitute not less than 75 per cent. (or
such lesser percentage as Kindred may decide, but such percentage
not being less than 50 per cent. plus one share) in nominal value
of the 32Red Shares and represent not less than 75 per cent. (or
such lesser percentage as Kindred may decide, but such percentage
not being less than 50 per cent. plus one share) of the voting
rights carried by the 32Red Shares.
The Offer Document and Form of Acceptance, containing further
information about the Offer, will be sent to 32Red Shareholders as
soon as practicable (and, in any event, within 28 days of the date
of this announcement or such later date as Kindred and 32Red may
agree) and will be made available by Kindred on its website at
www.kindredplc.com/ and by 32Red on its website at
www.32Redplc.com/.
3. Background to and reasons for the Offer
Kindred has a track record of making careful acquisition choices
and successfully integrating these into the group, with eight
companies having been acquired since 2005, extending the Kindred
Group's geographic coverage and increasing its potential for
long-term profitability. As part of Kindred's multi-brand strategy,
Kindred uses acquisitions to complement its strong organic growth
and to strengthen its position in locally-regulated or soon-to-be
regulated countries.
32Red represents a strong strategic and cultural fit for Kindred
and is consistent with its key areas of focus, namely:
Providing the best customer experience
32Red has a heritage in pure online gaming and has established a
strong reputation by innovating for the improvement of its
customers' experience as well as protecting them. This is
consistent with Kindred's ambition to provide customers with the
best experience possible. Both companies believe such an approach
strengthens their trusted brands in the marketplace, in turn
driving more customers to their businesses and retaining them for
longer.
Creating industry leading brands
In December 2016, Kindred changed its group name from Unibet
Group plc reflecting the fact that the group was growing and
changing, with 13 consumer-facing brands in its portfolio, many of
them acquired. In a competitive market such as online gaming, a
strong brand is a key differentiator. Since its inception in 2002,
32Red has developed what Kindred believes to be a distinct, trusted
and leading brand in the market. As an established online gaming
brand in the UK, 32Red will sit extremely well within the Kindred's
multi-brand strategy.
Building market share
The large, regulated and fast-growing UK market is a key
territory for Kindred as demonstrated by the acquisition of the
online business of Stan James plc in 2015. With a significant
proportion of 32Red's revenue being generated in the UK, the
acquisition of 32Red will considerably strengthen Kindred's
position in the strategic UK market.
There are expected to be both cost and revenue synergies arising
from the integration of 32Red into Kindred with the future
migration of 32Red onto the Kindred platform providing 32Red's
customers access to Kindred's extended range of content. It is
expected that the transaction will be earnings enhancing in the
first full financial year following acquisition.
4. Information on Kindred
Founded in 1997, Kindred is one of the largest online gambling
companies in the world with over 15 million customers across more
than 100 countries. Kindred is home to 13 consumer-facing brands,
and is licensed in Australia and 11 EU member states. Kindred
offers pre-game and live sports betting, poker, casino and games
through several subsidiaries and brands including Unibet, Stan
James, Maria Casino, iGame and Bingo.com, each with distinctive
market positions. Kindred is headquartered in Malta and has over
1,100 employees across its various locations.
Kindred is listed on Nasdaq Stockholm Large Cap List and as of
the close of trading on 22 February 2017, the latest practicable
date prior to the date of this announcement, had a market
capitalisation of approximately GBP1,719 million. In its most
recent reported financial year ended 31 December 2016, Kindred
generated gross win revenues of GBP544.1 million and EBITDA of
GBP123.7 million.
For more information about Kindred, visit
www.kindredplc.com.
5. Information on 32Red
Founded in 2002, 32Red is an award-winning online gaming
company, operating an online casino, 32Red.com, as well as a poker
room, 32RedPoker.com, online bingo destination, 32RedBingo.com, and
a sports betting brand, 32RedSport.com. In 2015, 32Red acquired the
Roxy Palace online casino business. 32Red is principally licensed
and regulated in Gibraltar, the United Kingdom and Italy. 32Red is
located in Gibraltar and has approximately 125 employees.
In its most recent reported financial year ended 31 December
2015, 32Red generated revenues of GBP48.7 million and EBITDA
(before share option costs and exceptional items) of GBP5.2
million.
6. Current trading and prospects of 32Red
On 1 February 2017, 32Red provided an update on its trading
performance for the year ended 31 December 2016.
32Red delivered a record annual net gaming revenue, up 28 per
cent. to GBP62.3m (2015: GBP48.7m). This strong performance was
driven by a combination of healthy organic growth in 32Red Casino,
(up 19 per cent. on 2015), and a full financial year contribution
from the Roxy Place business (acquired in July 2015).
In 2015 and 2016, 32Red's net gaming revenue by segment was:
Total net gaming revenue 2016 2015 Variance
--------------------------- --------- --------- ----------
32Red Casino - net gaming
revenue GBP58.5m GBP46.3m +26%
--------------------------- --------- --------- ----------
32Red Bingo, 32Red Poker
and 32Red Sports - net
gaming revenue GBP3.8m GBP2.4m +60%
--------------------------- --------- --------- ----------
Total Net Gaming Revenue GBP62.3m GBP48.7m +28%
--------------------------- --------- --------- ----------
32Red Casino's net gaming revenue increased by 26 per cent. to
GBP58.5m in 2016 (2015: GBP48.7m), representing 94 per cent. of
32Red's total net gaming revenue for the 2016 financial year (2015:
95 per cent.). This strong growth reflected (i) the increased
marketing investment in the 32Red Casino brand, (ii) a full
financial year's contribution from Roxy Place Casino, and (iii)
healthy growth from 32Red Casino in Italy. In addition, revenue
from 32Red Bingo, 32Red Poker and 32Red Sport continued to grow
strongly in 2016, primarily driven by 32Red Sport which continues
to develop as an increasingly important customer acquisition and
retention channel for 32Red.
32Red will announce its 2016 preliminary results on 9 March
2017. The results are expected to be in line with the 32Red Board's
previous expectations. Early trading in 2017 has been strong across
the Wider 32Red Group with revenues for the first 30 days in
January 2017 up 21 per cent. on the corresponding period in
2016.
7. Recommendation by the 32Red Directors
The 32Red Directors, who have been so advised by Numis as to the
financial terms of the Offer, consider the terms of the Offer to be
fair and reasonable. In providing advice to the 32Red Directors,
Numis has taken into account the commercial assessments of the
32Red Directors.
Accordingly, the 32Red Directors intend unanimously to recommend
that 32Red Shareholders accept (or procure the acceptance of) the
Offer (or, in the event that the Offer is implemented by way of a
Scheme, vote in favour of the resolutions relating to such Scheme),
as the 32Red Directors have irrevocably undertaken to do in respect
of their own beneficial holdings of 36,993,281 32Red Shares
representing, in aggregate, approximately 43.3 per cent. of the
ordinary share capital of 32Red in issue on 22 February 2017 (being
the latest practicable date prior to the publication of this
announcement). These irrevocable undertakings are given in terms
such that they will continue to be binding (and will not lapse)
even in the event of a new offer for 32Red being made or announced
by a third party.
8. Background to and reasons for the recommendation by 32Red
Since listing on AIM in 2005, 32Red has successfully pursued its
clear and focused strategy to exploit both organic and selective
M&A opportunities and deliver sustainable long-term growth for
all its stakeholders. This strategy has been focused, primarily,
upon growing its brands in its core UK market and expansion in new
regulated markets where 32Red could exploit its marketing strength.
This strategy has delivered strong net gaming revenue growth and
increased profitability for shareholders, most recently illustrated
by 32Red's 2016 year-end update.
However, whilst the 32Red Directors continue to believe in its
stated growth strategy and the strength of the 32Red brand, they
also believe that 32Red would now be better placed as part of a
larger group. Kindred represents a strong strategic fit for 32Red
and the 32Red Directors believe a combination will build on 32Red's
long-standing presence and well-established brand in the UK casino
market.
In making its assessment of the merits of the Offer, the 32Red
Board has taken into account:
- the level of the cash consideration payable under the Offer,
being at a level above 32Red's all-time high closing share price
and (including the Approved Dividend) at a premium of 39.5 per
cent. to the volume weighted average closing price per 32Red Share
of 143.4 pence in the three months prior to the date of this
announcement;
- the Offer representing an attractive valuation when considered
against 32Red's historic earnings and prospects;
- the relative lack of liquidity in 32Red Shares and the fact
that the Offer provides 32Red Shareholders with a certain
opportunity to realise their investment in 32Red wholly for cash;
and
- the level of irrevocable undertakings to accept (or procure
the acceptance of) the Offer, representing, in aggregate 71.1 per
cent. of the 32Red Shares.
Following this assessment and for the reasons set out above, the
32Red Board is unanimously recommending that 32Red Shareholders
accept the Offer.
9. Irrevocable undertakings in relation to the Offer
Kindred has received irrevocable undertakings to accept (or
procure acceptance of) the Offer representing an aggregate of
60,701,232 32Red Shares, representing approximately 71.1 per cent.
of the share capital of 32Red in issue on 22 February 2017 (being
the latest practicable date prior to the publication of this
announcement).
With the exception of the undertaking given by Miton Asset
Management, each of the irrevocable undertakings are given in terms
such that they will continue to be binding (and will not lapse)
even in the event of a new offer for 32Red being made or announced
by a third party. The undertaking given by Miton Asset Management
will lapse if (i) the Offer is withdrawn or lapses and no new,
revised or replacement Offer is announced at the same time; or (ii)
a third party makes a competing offer for the entire issued share
capital of 32Red at a value which (in 32Red's reasonable opinion on
the advice of Numis) exceeds the value of the consideration offered
under the terms of the Offer by 10% or more per 32Red Share.
Further details of these irrevocable undertakings are set out in
Appendix III to this announcement.
10. Management, employees and locations
Kindred believes that 32Red's management and employees are an
important part of the opportunity to develop Kindred, particularly
in the strategic UK market.
Kindred believes that, if the Offer is declared wholly
unconditional, it will offer good career opportunities to 32Red
employees.
11. Financing
The consideration payable under the Offer will be funded by new
term and revolving facilities (the "Facilities") provided to
Kindred by Swedbank, pursuant to a facilities agreement entered
into between Kindred as borrower and Swedbank as lender (the
"Swedbank Facility").
The Facilities comprise of: (i) a GBP110,000,000 term loan to be
applied towards, amongst other things, financing the Offer; (ii) a
EUR 112,000,000 revolving facility "A" to be applied towards,
amongst other things, financing the Offer, refinancing Kindred's
existing revolving facility dated 31 August 2015 and towards any
market purchases of 32Red Shares, and (iii) a GBP68,000,000
revolving facility "B" to be applied towards, amongst other things,
financing the Offer and any market purchases of 32Red Shares.
In respect of the Swedbank Facility, Kindred has agreed that,
subject to certain limited exceptions, it will not waive or amend
certain conditions and certain further terms of the Offer without
the consent of Swedbank.
Houlihan Lokey is satisfied that sufficient resources are
available to Kindred to satisfy in full the consideration payable
to 32Red Shareholders under the terms of the Offer (which for the
avoidance of doubt, does not include the Approved Dividend which is
payable by 32Red).
12. 32Red Share Plans
Participants in the 32Red Share Plans will be contacted in due
course regarding the effect of the Offer under those plans and
provided with further details concerning proposals which will be
made to them. Details of the proposals will be set out in the Offer
Document and in separate letters to be sent to the participants in
the 32Red Share Plans.
Kindred intends to provide incentive arrangements for 32Red
employees consistent with Kindred's compensation schemes and having
regard to 32Red's current incentive arrangements and its desire to
attract and retain talent at 32Red.
13. Compulsory acquisition, delisting and cancellation of trading
If the Offer becomes or is declared unconditional in all
respects and Kindred receives valid acceptances in respect of 32Red
Shares which, together with the 32Red Shares acquired, or agreed to
be acquired, before or during the Offer by Kindred, represent not
less than 75 per cent. of the voting rights attaching to the 32Red
Shares, Kindred intends to procure that 32Red will make an
application to the London Stock Exchange for the cancellation of
the admission to trading on AIM of 32Red Shares and Kindred will
seek to re-register 32Red as a private company.
A notice period of not less than 20 Business Days (at the expiry
of which, cancellation will become effective) will commence on the
date on which the Offer becomes or is declared unconditional in all
respects provided that Kindred has attained 75 per cent. or more of
the voting rights as described above.
Delisting would significantly reduce the liquidity and
marketability of any 32Red Shares not assented to the Offer.
If Kindred receives acceptances to the Offer in respect of,
and/or otherwise acquires not less than 90 per cent. of the 32Red
Shares to which the Offer relates by nominal value and voting
rights attaching to such shares, Kindred intends to exercise its
rights pursuant to section 352A of the Companies Act 2014 of
Gibraltar, and section 208 of the Companies Act 1930 of Gibraltar,
to acquire compulsorily, on the same terms as the Offer, the
remaining 32Red Shares not assented to the Offer.
14. Conditions to the Offer
The Offer will be conditional upon the satisfaction or waiver of
the Conditions, as set out in Appendix I. In particular, the Offer
will be conditional upon:
(a) valid acceptances being received by no later than 1:00 p.m.
on the first closing date of the Offer (or such later time(s)
and/or date(s) as Kindred may decide) in respect of 32Red Shares
which, together with all other 32Red Shares which Kindred acquires
or agrees to acquire (whether pursuant to the Offer or otherwise),
constitute no less than 75 per cent. (or such lesser percentage as
Kindred may decide, but such percentage not being less than 50 per
cent. plus one share) in nominal value of 32Red Shares and
represents not less than 75 per cent. (or such lesser percentage as
Kindred may decide, but such percentage not being less than 50 per
cent. plus one share) of the voting rights attached to such shares;
and
(b) the Gaming Regulators having approved the acquisition by
Kindred of 32Red Shares representing more than 50 per cent. of the
voting rights carried by the 32Red Shares.
If Kindred has not received acceptances in respect of 32Red
Shares which, together with the 32Red Shares acquired, or agreed to
be acquired, before or during the Offer by Kindred, represent not
less than 75 per cent. (or such lesser percentage as Kindred may
decide, but such percentage not being less than 50 per cent. plus
one share) of the voting rights attaching to the 32Red Shares, by
1:00 p.m. (London time) on the first closing date of the Offer (or
such later time(s) and/or date(s) as Kindred may decide), the Offer
will lapse.
The full Conditions of the Offer are set out in Appendix I.
15. Overseas Shareholders
The release, publication or distribution of this announcement
and the availability of the Offer to persons not resident in the
United Kingdom or Gibraltar may be affected by the laws of other
jurisdictions in relation to the Offer. Overseas Shareholders
should inform themselves about and observe all applicable legal
requirements.
This announcement has been prepared for the purposes of
complying with applicable English and Gibraltar law and applicable
securities laws, and the information disclosed may not be the same
as that which would have been disclosed if this announcement had
been prepared in accordance with the laws of jurisdictions outside
the United Kingdom and Gibraltar.
16. Offer-related arrangements and documents available on a website
Offer-related arrangements
Confidentiality Agreement
Kindred and 32Red entered into a confidentiality agreement on 22
December 2016 pursuant to which Kindred and 32Red have undertaken
to each other to keep information relating to the other
confidential and not to disclose it to third parties (other than to
permitted recipients) unless required by law or regulation.
Application of certain aspects of the Code
As 32Red is incorporated and has its registered office in
Gibraltar, the Code does not apply to Kindred or 32Red in relation
to the Offer. However, in accordance with 32Red's articles of
association and in order to ensure the most transparent and orderly
procedure, Kindred and 32Red confirm that, to implement the Offer,
they will observe and comply with the provisions of the Code
(including the provisions of Appendix 7 of the Code if the Offer is
implemented by way of a Scheme), as if 32Red (and therefore the
Offer) were subject to the Code.
Documents available on website
Copies of the following documents will be made available on
Kindred's and 32Red's websites at www.kindredplc.com and
www.32Redplc.com respectively by no later than 12 noon (London
time) on the Business Day following this announcement until the end
of the Offer:
-- the Confidentiality Agreement;
-- the irrevocable undertakings referred to in paragraphs 7 and 9 above; and
-- documents relating to the financing of the Offer referred to in paragraph 11 above.
17. Opening Position Disclosures and Interests
Except for the irrevocable undertakings referred to in paragraph
9 above, as at close of business on 22 February 2017 (being the
latest practicable date prior to the date of this announcement),
neither Kindred, nor any of the directors of Kindred or any member
of the Kindred Group, nor, so far as the directors of Kindred are
aware, any person acting in concert with Kindred for the purposes
of the Offer, had any interest in, right to subscribe for, or had
borrowed or lent any 32Red Shares or securities convertible or
exchangeable into 32Red Shares, nor did any such person have any
short position (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 take delivery, or any dealing
arrangement of the kind referred to in Note 11 of the definition of
acting in concert in the Code, in relation to 32Red Shares or in
relation to any securities convertible or exchangeable into 32Red
Shares.
However, in the interests of maintaining secrecy prior to the
publication of this announcement, Kindred has not yet completed
enquiries in respect of the matters referred to in this paragraph
of certain parties who would be deemed by the Code to be acting in
concert with it for the purposes of the Offer. Enquiries of such
parties will be completed as soon as practicable following the
making of this announcement and, in accordance with Note 2(a)(i) to
Rule 8 of the Code (as if it applied), further disclosures, if any,
required in respect of such parties will be made as soon as
possible and in any event by no later than 12 noon (London time) on
9 March 2017.
18. Issued share capital
In accordance with 2.9 of the Code, 32Red confirms that, as at
the date of this announcement, it has 85,347,528 ordinary shares of
0.2 pence each in issue. The ISIN for 32Red Shares is
GI000A0F56M0.
19. General
Kindred reserves the right to elect to implement the acquisition
of the 32Red Shares by way of a Scheme as an alternative to a
Takeover Offer. In such event, the Scheme will be implemented on
the same terms (subject to appropriate amendments), so far as
applicable, as those which could apply to the Offer.
The bases and sources of certain financial information contained
in this announcement are set out in Appendix II to this
announcement. A summary of the irrevocable undertakings is
contained in Appendix III to this announcement. Appendix IV
contains definitions of certain expressions used in this
announcement.
Enquiries:
Kindred Group plc
+46 (0) 723 878
Henrik Tjärnström 059
+44 (0) 788 799
Inga Lundberg 6116
Houlihan Lokey (Financial adviser
to Kindred)
+44 (0) 20 7839
George Fleet 3355
Panmure Gordon (Broker to Kindred)
+44 (0) 20 7886
Ben Thorne 2500
Erik Anderson
32Red plc +00 350 200 49396
Ed Ware
Jon Hale
Numis (Financial adviser, nominated +44 (0) 20 7260
adviser and broker to 32Red) 1000
Michael Meade
Richard Thomas
Michael Burke
Important Notices
Houlihan Lokey EMEA, LLP which is authorised and regulated in
the United Kingdom by the Financial Conduct Authority, is acting
exclusively for Kindred and no-one else in connection with the
subject matter of this announcement, and will not be responsible to
anyone other than Kindred for providing the protections afforded to
clients of Houlihan Lokey EMEA, LLP, nor for giving advice in
relation to the subject matter of this announcement. Neither
Houlihan Lokey EMEA, LLP, 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 EMEA, LLP, in connection with this announcement, any
statement contained herein or otherwise.
Panmure Gordon (UK) Limited, which is authorised and regulated
by the Financial Conduct Authority in the United Kingdom, is acting
exclusively for Kindred and no-one else in connection with the
matters set out in this announcement, and will not be responsible
to anyone other than Kindred for providing the protections afforded
to clients of Panmure Gordon (UK) Limited nor for giving advice in
relation to the subject matter of this announcement.
Numis Securities Limited, which is authorised and regulated by
the Financial Conduct Authority in the United Kingdom, is acting
exclusively for 32Red and no-one else in connection with the
subject matter of this announcement, and will not be responsible to
anyone other than 32Red for providing the protections afforded to
clients of Numis Securities Limited, nor for giving advice in
relation to the subject matter of this announcement.
The City Code on Takeovers and Mergers
By virtue of its status as a Gibraltar incorporated company, the
Code does not apply to 32Red. Accordingly, 32Red Shareholders are
reminded that the Panel does not have responsibility, in relation
to 32Red, for ensuring compliance with the Code and is not able to
answer 32Red Shareholders' queries. In accordance with 32Red's
articles of association, 32Red and Kindred have agreed in this
announcement that, to implement the Offer, they will observe and
comply with the provisions of the Code as if 32Red (and therefore
the Offer) were subject to the Code. Further details of this
agreement are set out at paragraph 16 in this announcement.
In particular, public disclosures consistent with the provisions
of Rule 8 of the Code (as if it applied to 32Red) should not be
emailed to the Panel, but, as described below, released directly
through a Regulatory Information Service.
Further Information
This announcement is for information purposes only and is not
intended to, and does not, constitute or form part of any offer,
invitation or solicitation of any offer to purchase, otherwise
acquire, subscribe for, sell or otherwise dispose of any securities
or the solicitation of any vote or approval in any jurisdiction,
pursuant to the Offer or otherwise, nor shall there be any sale,
issuance, or transfer of securities in any jurisdiction in
contravention of applicable law.
The Offer will be made solely by means of the Offer Document
and, in respect of the 32Red Shares held in certificated form, the
Form of Acceptance, which will contain the full terms and
Conditions of the Offer, including details of how the Offer may be
accepted. Any decision in respect of, or other response to, the
Offer should be made only on the basis of the information contained
in those documents. 32Red Shareholders are advised to read the
formal documentation in relation to the Offer carefully once it has
been despatched.
This announcement has been prepared for the purpose of complying
with applicable English and Gibraltar law and applicable securities
laws and the information disclosed may not be the same as that
which would have been disclosed if this announcement had been
prepared in accordance with the laws of jurisdictions outside the
United Kingdom and Gibraltar.
Overseas Shareholders
The release, publication or distribution of this announcement in
certain jurisdictions may be restricted by law. Persons who are not
resident in the United Kingdom or Gibraltar or who are subject to
other jurisdictions should inform themselves of, and observe, any
applicable requirements. Any failure to comply with these
requirements 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 Offer
disclaim any responsibility or liability for the violation of such
requirements by any person.
US 32Red Shareholders should note that the Offer relates to the
securities of a Gibraltar company which are admitted to trading on
AIM, is subject to Gibraltar and UK procedural and disclosure
requirements (which are different from those of the US) and is
proposed to be implemented under a takeover offer under applicable
Gibraltar law and in accordance with the Code (as if it applied to
32Red, and therefore the Offer). Accordingly, the Offer will be
subject to Gibraltar procedural and disclosure requirements and
practices, which are different from the procedural and disclosure
requirements of the US tender offer rules under the United States
Exchange Act. The financial information with respect to 32Red
included in this announcement and the Offer documentation has been
or will have been prepared in accordance with IFRS and thus may not
be comparable to financial information of US companies or companies
whose financial statements are prepared in accordance with
generally accepted accounting principles in the US.
Unless otherwise determined by Kindred and permitted by
applicable law and regulation, the Offer 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 accept the Offer by any such use,
means, instrumentality or form 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 all documents relating to the Offer are not being,
and must not be, directly or indirectly, mailed or otherwise
forwarded, distributed or sent in, into or from a Restricted
Jurisdiction where to do so would violate the laws in that
jurisdiction, and persons receiving this announcement and all
documents relating to the Offer (including custodians, nominees and
trustees) must not mail or otherwise distribute or send them in,
into or from such jurisdictions where to do so would violate the
laws in that jurisdiction.
The availability of the Offer to 32Red Shareholders who are not
resident in the United Kingdom or Gibraltar may be affected by the
laws of the relevant jurisdictions in which they are resident.
Persons who are not resident in the United Kingdom or Gibraltar
should inform themselves of, and observe, any applicable
requirements.
Forward Looking Statements
This announcement contains statements about Kindred and 32Red
that are or may be forward looking statements. All statements other
than statements of historical facts included in this announcement
may be forward looking statements. Without limitation, any
statements preceded or followed by or that include the words
"targets", "plans", "believes", "expects", "aims", "intends",
"will", "may", "anticipates", "estimates", "projects" or words or
terms of similar substance or the negative thereof, are forward
looking statements. Forward looking statements include statements
relating to the following: (i) future capital expenditures,
expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the
expansion and growth of Kindred's or 32Red's operations and
potential synergies resulting from the Offer; and (iii) the effects
of government regulation on Kindred's or 32Red's business.
Such forward looking statements involve risks and uncertainties
that could significantly affect expected results and are based on
certain key assumptions. Many factors could cause actual results to
differ materially from those projected or implied in any forward
looking statements. Due to such uncertainties and risks, readers
are cautioned not to place undue reliance on such forward looking
statements, which speak only as of the date hereof. Each of Kindred
and 32Red disclaims any obligation to update any forward looking or
other statements contained herein, except as required by applicable
law.
No profit forecasts or estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for Kindred or 32Red, as appropriate, for the
current or future financial years would necessarily match or exceed
the historical published earnings or earnings per share for Kindred
or 32Red, as appropriate.
Disclosure requirements
32Red is a Gibraltar company and is therefore not subject to the
Code. Accordingly, shareholders of 32Red and others dealing in
32Red Shares are not obliged to disclose any of their dealings
under the provisions of the Code. However, market participants are
requested to make disclosure of dealings as if the Code applied and
as if 32Red were in an "offer period" under the Code. 32Red
Shareholders and persons considering the acquisition or disposal of
any interest in 32Red Shares are reminded that they are subject to
the Disclosure Guidance and Transparency Rules made by the UKLA and
other applicable regulatory rules regarding transactions in 32Red
Shares.
If you are in any doubt as whether or not you should disclose
dealings, you should contact an independent financial adviser
authorised by the Financial Conduct Authority under the FSMA (or,
if you are resident in a jurisdiction other than the United
Kingdom, a financial adviser authorised under the laws of such
jurisdiction).
In light of the foregoing, as provided in Rule 8.3(a) of the
Code, any person who is "interested" in one per cent. or more of
any class of "relevant securities" of 32Red 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") is requested to make an Opening
Position Disclosure following the commencement of the "offer
period" which begins upon the release of this announcement.
An Opening Position Disclosure should contain details of the
person's interests and short positions in, and rights to subscribe
for, any "relevant securities" of each of (i) 32Red and (ii)
Kindred. Persons to whom Rule 8.3(a) would have applied had the
Code been applicable are requested to make an Opening Position
Disclosure by no later than 3:30 p.m. (London time) on the tenth
Business Day following the commencement of the "offer period" which
begins upon the release of this announcement. Relevant persons who
undertake "dealings" in the relevant securities of 32Red or a
"securities exchange offeror" prior to the deadline for making an
Opening Position Disclosure are requested instead to make a Dealing
Disclosure.
Rule 8.3(b) of the Code provides that if any person is, or
becomes "interested" (directly or indirectly) in one per cent. or
more of any class of "relevant securities" of an offeree or of any
"securities exchange offeror", all "dealings" in any "relevant
securities" of that offeree or of any "securities exchange offeror"
(including by means of an option in respect of, or a derivative
referenced to, any such "relevant securities") should be publicly
disclosed in a Dealing Disclosure by no later than 3:30 p.m.
(London time) on the Business Day following the date of the
relevant transaction. In a situation where the Code applies, this
requirement would continue until the date on which any "offer"
becomes, or is declared, unconditional as to acceptances, lapses or
is otherwise withdrawn or on which the "offer period" otherwise
ends. Under Rule 8 of the Code, a Dealing Disclosure would 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 (i) 32Red and (ii) any "securities exchange
offeror", save to the extent that these details have previously
been disclosed under Rule 8.
Accordingly, in the case of both an Opening Position Disclosure
and Dealing Disclosure (if any), disclosures of interests in the
shares of 32Red are requested to be made.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire an "interest"
in "relevant securities" of 32Red or a "securities exchange
offeror", they would, if the Code were applicable, be deemed to be
a single person for the purpose of Rule 8.3 of the Code.
Consistent with the provisions of Rule 8.1 of the Code, Opening
Position Disclosures should be made by 32Red and by any "offeror",
and all "dealings" in "relevant securities" of 32Red by 32Red, by
any "offeror" or by any persons "acting in concert" with any of
them, should be disclosed in a Dealing Disclosure by no later than
12:00 p.m. (London time) on the Business Day following the date of
the relevant transaction.
"Interests in securities" arise, in summary, when a person has
long economic exposure, whether conditional or absolute, to changes
in the price of "securities". In particular, a person will be
treated as having an "interest" by virtue of the ownership or
control of "securities", or by virtue of any option in respect of,
or derivative referenced to, "securities".
Terms in quotation marks are defined in the Code, which can be
found on the Panel's website. If you are in any doubt as to whether
not you should disclose a "dealing" by reference to the above, you
should contact an independent financial adviser authorised by the
FCA under the FSMA.
It should be noted that, for the purposes of the above summary
of Rule 8 of the Code, Kindred is not treated as a "securities
exchange offeror" and therefore there is no requirement to disclose
interests or dealings in shares of Kindred.
Electronic Communications
Please be aware that addresses, electronic addresses and certain
information provided by 32Red Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from 32Red may be provided to Kindred during the
Offer Period as requested under Section 4 of Appendix 4 of the Code
to comply with Rule 2.12(c) of the Code.
Publication on Website and Availability of Hard Copies
A copy of this announcement will be made available, subject to
certain restrictions relating to persons resident in Restricted
Jurisdictions, on Kindred's and 32Red's websites at
www.kindredplc.com/ and www.32Redplc.com/ respectively by no later
than 12 noon (London time) on the Business Day following this
announcement. For the avoidance of doubt, the contents of those
websites are not incorporated and do not form part of this
announcement.
You may request a hard copy of this announcement by contacting
the Company Secretary of 32Red by submitting a request in writing
to the Company Secretary at 32 Red plc, 741 Europort, Gibraltar.
You may also request that all future documents, announcements and
information to be sent to you in relation to the Offer should be in
hard copy form.
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 the figures that precede them.
APPIX I
CONDITIONS AND FURTHER TERMS OF THE OFFER
Part A: Conditions of the Offer
The Offer will be subject to the following Conditions:
1. valid acceptances being received (and not, where permitted,
withdrawn) by no later than 1.00 p.m. (London time) on the first
closing date of the Offer (or such later time(s) and/or dates(s) as
Kindred may, in accordance with the Code, decide) in respect of
32Red Shares which, together with all other 32Red Shares acquired
by Kindred (whether pursuant to the Offer or otherwise) constitute
not less than 75 per cent. (or such lower percentage as Kindred may
decide) in nominal value of 32Red Shares and represent not less
than 75 per cent. (or such lower percentage as Kindred may decide)
of the voting rights carried by the 32Red Shares, provided that
this condition will not be satisfied unless Kindred and/or any of
its wholly-owned subsidiaries shall have acquired, or agreed to
acquire, pursuant to the Offer or otherwise, 32Red Shares carrying
more than 50 per cent. of the voting rights normally exercisable at
general meetings of 32Red, including for this purpose any such
voting rights attaching to any 32Red Shares that are
unconditionally allotted fully paid or issued before the Offer
becomes or is declared unconditional as
to acceptances whether pursuant to the exercise of outstanding
subscription or conversion rights or otherwise and for the purposes
of this condition:
(a) 32Red Shares which have been unconditionally allotted but
not issued shall be deemed to carry the voting rights which they
will carry upon issue; and
(b) valid acceptances shall be deemed to have been received in
respect of 32Red Shares which are treated as having been acquired
or contracted to be acquired by Kindred by virtue of acceptances of
the Offer.
2. Subject as stated in Part B below, the Offer will be
conditional upon satisfaction of the following Conditions and,
accordingly, the Offer will not be declared or become unconditional
in all respects unless such Conditions (as amended if appropriate)
have been satisfied or, where relevant, waived:
Licensing authority of Gibraltar change of control approval
(a) the approval by the Licensing Authority (Gambling Division)
of HM Government of Gibraltar of the acquisition by Kindred of
32Red Shares representing more than 50 per cent. of the voting
rights carried by the 32Red Shares and any matters pursuant to such
acquisition which relate to the control, management and operation
of 32Red;
UK Gambling Commission change of control approval
(b) the making of a determination by the UKGC pursuant to
section 102(4)(a) of the UK Gambling Act in respect of all
operating licences (as such term is defined in the UK Gambling Act)
held by members of the Wider 32Red Group that all such operating
licences shall continue to have effect following the acquisition by
Kindred of 32Red Shares representing more than 50 per cent. of the
voting rights carried by the 32Red Shares, such determination to be
made following an application in respect of the same submitted by
32Red to the UKGC pursuant to section 102(2)(b) of the UK Gambling
Act;
Cessation of 32Red's operations in Australia
(c) the cessation by 32Red of all of its online gambling
services (other than services required to return funds to players
following such cessation as soon as reasonably practicable) to, and
the acceptance of bets from, residents of Australia;
Other notifications, waiting periods and authorisations
(d) other than in respect of Conditions 2(a) and 2(b):
(i) all material notifications, filings or applications which
are necessary or are considered appropriate or desirable by Kindred
(acting reasonably) having been made in connection with the Offer
and all appropriate waiting periods (including any extensions
thereof) under any applicable legislation or regulation of any
relevant jurisdiction having expired, lapsed or been terminated (as
appropriate);
(ii) all statutory and regulatory obligations in any
jurisdiction having been complied with in each case in respect of
the Offer and all Authorisations which are necessary or are
reasonably considered appropriate in any relevant jurisdiction for
or in respect of the Offer and the acquisition or the proposed
acquisition of any shares or other securities in, or control or
management of, 32Red or any other member of the Wider 32Red Group
by any member of the Wider Kindred Group having been obtained in
terms and in a form reasonably satisfactory to Kindred from all
appropriate Third Parties and (without prejudice to the generality
of the foregoing) from any persons or bodies with whom any member
of the Wider 32Red Group or the Wider Kindred Group has entered
into contractual arrangements in each case where the absence of
such Authorisation would have a material adverse effect on the
Wider 32Red Group taken as a whole; and
(iii) all such Authorisations remaining in full force and effect
at the time at which the Offer becomes or is declared unconditional
in all respects and there being no notice or intimation of an
intention to revoke, suspend, restrict, modify or not to renew any
of such Authorisations;
General antitrust and regulatory
(e) other than in respect of Conditions 2(a) and (b), no
antitrust regulator or Third Party having announced or given notice
of a decision to take, institute, implement or threaten any action,
proceeding, suit, investigation, enquiry or reference (and in each
case, not having withdrawn the same), 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 outstanding any statute,
regulation, decision or order which would or might reasonably be
expected to:
(i) require, prevent or materially delay the divestiture or
materially alter the terms envisaged for such divestiture by any
member of the Wider Kindred Group or by any member of the Wider
32Red Group of all or any material part of its businesses, assets
or property or impose any material limitation on the ability of all
or any of them to conduct their respective businesses (or any part
thereof) or to own, control or manage any of their assets or
properties (or any material part thereof);
(ii) except pursuant to Part VIII of the Companies Act 2014 of
Gibraltar, require any member of the Wider Kindred Group or the
Wider 32Red Group to acquire or offer to acquire any shares, other
securities (or the equivalent) or interest in any member of the
Wider 32Red Group or any member of the Wider Kindred Group or any
asset owned by any Third Party (other than in the implementation of
the Offer);
(iii) impose any material limitation on, or result in a material
delay in, the ability of any member of the Wider Kindred Group
directly or indirectly to acquire, hold or to exercise effectively
all or any rights of ownership in respect of shares or other
securities in 32Red or on the ability of any member of the Wider
32Red Group or any member of the Wider Kindred Group directly or
indirectly to hold or exercise effectively all or any rights of
ownership in respect of shares or other securities (or the
equivalent) in, or to exercise voting or management control over,
any member of the Wider 32Red Group;
(iv) otherwise adversely affect (in any material respect) any or
all of the business, assets, profits or prospects of the Wider
32Red Group or the Wider Kindred Group;
(v) result in any member of the Wider 32Red Group or any member
of the Wider Kindred Group ceasing to be able to carry on business
under any name under which, or in any jurisdiction in which it
presently carries on business;
(vi) make the Offer, its implementation or the acquisition or
proposed acquisition of any shares or other securities in, or
control or management of, 32Red or any member of the Wider 32Red
Group by any member of the Wider Kindred Group void, unenforceable
and/or illegal under the laws of any relevant jurisdiction, or
otherwise, directly or indirectly, materially prevent or prohibit,
restrict, restrain, or delay or otherwise materially interfere with
the implementation of, or impose material additional conditions or
obligations with respect to, or otherwise materially challenge,
impede, interfere with or require material amendment of, the Offer
or the acquisition or proposed acquisition of any shares or other
securities in, or control or management of, 32Red or any member of
the Wider 32Red Group by any member of the Wider Kindred Group;
(vii) require, prevent or materially delay a divestiture, or
materially alter the terms envisaged for such divestiture by any
member of the Wider Kindred Group or any member of the Wider 32Red
Group of any shares or other securities (or the equivalent) in any
member of the Wider 32Red Group or any member of the Wider Kindred
Group; or
(viii) impose any material limitation on the ability of any
member of the Wider Kindred Group or any member of the Wider 32Red
Group to conduct its business or to integrate or co-ordinate all or
any part of its business with all or any part of the business of
any other member of the Wider Kindred Group and/or the Wider 32Red
Group,
and all applicable waiting and other time periods (including any
extensions thereof) during which any such antitrust regulator or
Third Party could decide to take, institute, implement or threaten
any such action, proceeding, suit, investigation, enquiry or
reference or take any other step under the laws of any jurisdiction
in respect of, or otherwise intervene in the Offer or the
acquisition or proposed acquisition of any 32Red Shares having
expired, lapsed or been terminated;
Certain matters arising as a result of any arrangement,
agreement, etc.
(f) except as Disclosed, there being no provision of any
arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the Wider 32Red Group is a party
or by or to which any such member or any of its assets is or may be
bound, entitled or be subject, or any event or circumstance, which,
as a consequence of the Offer or the acquisition or the proposed
acquisition by any member of the Wider Kindred Group of any shares
or other securities (or the equivalent) in 32Red or any member of
the Wider 32Red Group or because of a change in the control or
management of any member of the Wider 32Red Group or otherwise,
could or might reasonably be expected to result in (in any case to
an extent which is or would be material in the context of the Wider
32Red Group or the Wider Kindred Group taken as a whole):
(i) any material borrowings by, or any other material
indebtedness, actual or contingent, of, or any grant available to,
any member of the Wider 32Red 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 becoming capable of being withdrawn or
inhibited;
(ii) the creation, save in the ordinary and usual course of
business, or enforcement of any mortgage, charge or other security
interest over the whole or any material part of the business,
property or assets of any member of the Wider 32Red Group or any
such mortgage, charge or other security interest (whenever created,
arising or having arisen) becoming enforceable;
(iii) any liability of any member of the Wider 32Red to make any
material severance, termination, bonus or other payment to any of
its directors, other officers or employees;
(iv) any such arrangement, agreement, lease, licence, franchise,
permit or other instrument being terminated or the rights,
liabilities, obligations, interests or business of any member of
the Wider 32Red Group under any such arrangement, agreement,
licence, permit, lease or instrument or the interests or business
of any member of the Wider 32Red Group in or with any other person
or body or firm or company (or any arrangement or arrangement
relating to any such interests or business) being or becoming
capable of being terminated, or adversely modified or affected or
any onerous obligation or liability arising or any adverse action
being taken thereunder;
(v) any member of the Wider 32Red Group ceasing to be able to
carry on business under any name under which it presently carries
on business;
(vi) the value of, or the financial or trading position or
prospects of, any member of the Wider 32Red Group being prejudiced
or adversely affected, in each case, in a material respect;
(vii) the creation or acceleration of any material liability
(actual or contingent) by any member of the Wider 32Red Group other
than the creation of liabilities incurred in the ordinary course of
business;
(viii) any material assets owned or used by any member of the
Wider 32Red Group or any interest in any such material asset, being
or falling to be disposed of or charged or ceasing to be available
to such member or any right arising under which any such material
asset or interest could be required to be disposed of or charged or
could cease to be available to such member; or
(ix) any requirement on any member of the Wider 32Red Group to
acquire, subscribe, pay up or repay any shares or other securities
(other than as contemplated by the terms of the Offer),
and no event having occurred which, under any provision of any
arrangement, agreement, licence, permit, franchise, lease or other
instrument to which any member of the Wider 32Red Group is a party
or by or to which any such member or any of its assets is or will
become bound, entitled or subject, would or might reasonably be
expected to result in any of the events or circumstances as are
referred to in Conditions 2(f)(i) to (ix) (inclusive);
Certain events occurring since 31 December 2016
(g) except as Disclosed and except, where relevant, as between
32Red and wholly owned subsidiaries of 32Red or as between wholly
owned subsidiaries of 32Red, no member of the Wider 32Red Group
having since, 31 December 2016:
(i) issued or agreed to issue, or authorised or proposed or
announced its intention to authorise or propose 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, securities or
convertible securities or transferred or sold or agreed to transfer
or sell or authorised or proposed the transfer or sale of 32Red
Shares out of treasury (except for the issue or transfer out of
treasury of 32Red Shares on the exercise of employee share options
or vesting of employee share awards in the ordinary course under
the 32Red Share Plans);
(ii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any bonus, dividend or other
distribution (whether payable in cash or otherwise) other than the
Approved Dividend;
(iii) other than pursuant to the Offer implemented, effected,
authorised or proposed or announced its intention to implement,
effect, authorise or propose any merger, demerger, reconstruction,
amalgamation, scheme, commitment or acquisition or disposal of
assets (in each case otherwise than in the ordinary course of
business) or shares or loan capital (or the equivalent thereof) in
any undertaking or undertakings in any such case to an extent which
is material in the context of the Wider 32Red Group taken as a
whole;
(iv) disposed of, or transferred, mortgaged or created any
security interest over any material asset or any right, title or
interest in any material asset or authorised, proposed or announced
any intention to do so in any such case to an extent which is
material in the context of the Wider 32Red Group taken as a
whole;
(v) issued or authorised or proposed or announced an intention
to authorise or propose the issue of, or made any change in or to
the terms of, any debentures or become subject to any contingent
liability or incurred or increased any indebtedness which in any
such case is material in the context of the Wider 32Red Group taken
as a whole;
(vi) entered into or varied or authorised, proposed or announced
its intention to enter into or vary any material contract,
arrangement, agreement, transaction or commitment (whether in
respect of capital expenditure or otherwise) which is of a long
term, unusual or onerous nature or magnitude or which is or which
involves or which might reasonably be likely to involve an
obligation of a nature or magnitude which is reasonably likely to
be materially onerous on the business of any member of the Wider
32Red Group and which, in any such case, when taken together with
any other such material transaction, arrangement, agreement,
contract or commitment, is material in the context of the Wider
32Red Group taken as a whole;
(vii) entered into or varied to a material extent the terms of,
or made any offer (which remains open for acceptance) to enter into
or vary to a material extent the terms of any contract, service
agreement, commitment or arrangement with any director or, except
for salary increases, bonuses or variations of terms, in the
ordinary course of business, senior executive of any member of the
Wider 32Red Group;
(viii) proposed, agreed to provide or modified the terms of any
share option scheme, incentive scheme or other benefit relating to
the employment or termination of employment of any employee of the
Wider 32Red Group which are material in the context of the Wider
32Red Group taken as a whole, save as agreed in writing between
32Red and Kindred;
(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, except in respect of the matters mentioned in
sub-paragraph (i) above, made any other change to any part of its
share capital;
(x) waived, compromised or settled any claim which is material
in the context of the Wider 32Red Group taken as a whole;
(xi) terminated or varied the terms of any agreement or
arrangement between any member of the Wider 32Red Group and any
other person in a manner which would or might reasonably be
expected to have a material adverse effect on the financial
position of the Wider 32Red Group taken as a whole;
(xii) made any material alteration to its memorandum or articles
of association or other incorporation documents which in any such
case is material in the context of the Offer as a whole;
(xiii) except in relation to changes made as required by
legislation or changes to legislation, made or agreed or consented
to any change to:
(a) the terms of the trust deeds and rules constituting the
pension scheme(s) established by any member of the Wider 32Red
Group for its directors or employees or their dependents;
(b) the contributions payable to any such scheme(s) or to the
benefits which accrue, or to the pensions which are payable,
thereunder;
(c) the basis on which qualification for, or accrual or
entitlement to, such benefits or pensions are calculated or
determined; or
(d) the basis upon which the liabilities (including pensions) of
such pension schemes are funded, valued, made, agreed or consented
to,
to an extent which is in any such case material in the context
of the Wider 32Red Group;
(xiv) been unable, or admitted in writing that it is unable, to
pay its debts 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 in
any such case where such is material in the context of the Wider
32Red Group taken as a whole;
(xv) (other than in respect of any member of the Wider 32Red
Group which is dormant and was solvent at the relevant time) taken
or proposed any steps or corporate action or had any legal
proceedings instituted or threatened against it in relation to the
suspension of payments, a moratorium of any indebtedness, its
winding-up (voluntary or otherwise), dissolution, reorganisation or
for the appointment of a receiver, administrator, manager,
administrative receiver, trustee or similar officer of all or any
material part 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 which in any such case is material in the context of the
Wider 32Red Group taken as a whole;
(xvi) made, authorised, proposed or announced an intention to
propose any change in its loan capital which in any such case is
material in the context of the Wider 32Red Group taken as a
whole;
(xvii) entered into, implemented or authorised the entry into,
any joint venture, asset or profit sharing arrangement, partnership
or merger of business or corporate entities; or
(xviii) 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 2(g);
No adverse change, litigation, regulatory enquiry or similar
(h) except as Disclosed, since 31 December 2016:
(i) no adverse change having occurred in, and no circumstance
having arisen which would or might reasonably be expected to result
in any adverse change in, the business, assets, financial or
trading position or profits or prospects or operational performance
of any member of the Wider 32Red Group which in any such case is
material in the context of the Wider 32Red Group taken as a
whole;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings by or against any member of the Wider 32Red
Group or to which any member of the Wider 32Red Group is or may
become a party (whether as claimant, defendant or otherwise) having
been threatened, announced or instituted or remaining outstanding
by, against or in respect of, any member of the Wider 32Red Group,
in each case, in circumstances which might reasonably be expected
to have a material adverse effect on the Wider 32Red Group taken as
a whole;
(iii) no enquiry, review or investigation by, or complaint or
reference to, any Third Party against or in respect of any member
of the Wider 32Red Group having been threatened, announced or
instituted or remaining outstanding by, against or in respect of
any member of the Wider 32Red Group, in each case, in circumstances
which might reasonably be expected to have a material adverse
effect on the Wider 32Red Group taken as a whole;
(iv) no contingent or other liability having arisen or become
apparent to 32Red or other than in the ordinary course of business
increased which is reasonably likely to affect adversely the
business, assets, financial or trading position or profits or
prospects of any member of the Wider 32Red Group to an extent which
is material in the context of the Wider 32Red Group taken as a
whole;
(v) no steps having been taken and no omissions having occurred
which are reasonably likely to result in the withdrawal (without
replacement), cancellation, termination or modification of any
licence held by any member of the Wider 32Red Group which is
necessary for the proper carrying on of its business and the
withdrawal, cancellation, termination or modification of which
might reasonably be expected to have a material adverse effect on
the Wider 32Red Group taken as a whole;
No discovery of certain matters regarding information and
liabilities
(i) except as Disclosed, Kindred not having discovered in
relation to the Wider 32Red Group:
(i) that any financial, business or other information concerning
the Wider 32Red Group publicly announced prior to the date of this
announcement or disclosed to any member of the Wider Kindred Group
by or on behalf of any member of the Wider 32Red Group at any time
prior to the date of this announcement is misleading, contains a
misrepresentation of any fact, or omits to state a fact necessary
to make that information not misleading, and which was not
subsequently corrected before the date of this announcement by
disclosure either publically via a Regulatory Information Service
or in writing to Kindred, and, in any such case, to an extent which
is material in the context of the Wider 32Red Group taken as a
whole;
(ii) that any member of the Wider 32Red Group or any
partnership, company or other entity in which any member of the
Wider 32Red Group has a significant economic interest and which is
not a subsidiary undertaking of 32Red is, otherwise than in the
ordinary course of business, subject to any liability, contingent
or otherwise which is material in the context of the Wider 32Red
Group taken as a whole; or
(iii) that any past or present member of the Wider 32Red Group
has not complied in any respect with all 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 32Red Group
which in any such case is material in the context of the Wider
32Red Group taken as a whole;
Anti-corruption
(iv) that any member of the Wider 32Red Group or any person that
performs or has performed services for or on behalf of any such
member is or has engaged in any activity, practice or conduct which
would constitute an offence under the Bribery Act 2010 or any other
applicable anti-corruption legislation; or
No criminal property
(v) that any asset of any member of the Wider 32Red Group
constitutes criminal property as defined by section 340(3) of the
Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that
definition).
Part B: Certain further terms of the Offer
3. Kindred reserves the right to waive, in whole or in part,
Conditions 2(a) to (i) (inclusive), so far as they relate to 32Red,
the Wider 32Red Group or any part thereof. Condition 1 shall not be
capable of being waived.
4. Kindred and 32Red have agreed, in accordance with 32Red's
articles of association, to observe and comply with the Code in
relation to the conduct and execution of the Offer (including where
the acquisition of the 32Red Shares by Kindred is to be implemented
by way of a Scheme pursuant to paragraph 7 of this Part B) as
though 32Red, Kindred and the Offer were subject to the Code.
5. The Offer will lapse if the acquisition of 32Red by Kindred
is referred to the Chair of the Competition and Markets Authority
for the constitution of a group under Schedule 4 to the Enterprise
and Reform Act 2013 before 1:00 p.m. (London time) on the first
closing date or the time and date on which the Offer becomes or is
declared unconditional as to acceptances (whichever is the
later).
6. If the Offer lapses, it will cease to be capable of further
acceptances, and persons accepting the Offer and Kindred shall
thereupon cease to be bound by acceptances submitted at or prior to
the time the Offer lapses.
7. The Offer will lapse, and will not proceed, unless all of the
Conditions relating to the Offer have been fulfilled or (if capable
of waiver) waived by, or where appropriate, have been determined by
Kindred to be and remain satisfied by, midnight on the twenty-first
day after the later of:
(a) the first closing date of the Offer; and
(b) the date on which the Offer becomes unconditional as to acceptances,
or such later date as Kindred and 32Red may agree. Kindred shall
not be under any obligation to waive (if capable of waiver), to
determine to be or remain satisfied or to treat as fulfilled any of
Conditions 2(a) to (i) (inclusive) by a date earlier than the
latest date for the fulfilment of that Condition notwithstanding
that the other Conditions of the Offer 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.
8. The 32Red Shares acquired under the Offer shall 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 attaching or accruing to them, including voting rights and
the right to receive and retain in full all dividends and other
distributions (if any) declared, made, paid or payable on or after
the date of this announcement, save in respect of the Approved
Dividend). Accordingly, insofar as a dividend or other distribution
(other than the Approved Dividend) is declared, made, paid or
payable by 32Red on or after the date of this announcement, Kindred
reserves the right (without prejudice to any right of Kindred to
invoke Condition 2(g)(ii) above) to reduce the consideration
payable under the Offer in respect of a 32Red Share by the
aggregate amount of such dividend or distribution (excluding
associated tax credit).
If any such dividend or distribution (other than the Approved
Dividend) is paid or made before the Offer is declared or becomes
wholly unconditional, if Kindred exercises its rights described in
this paragraph, any reference in this announcement to the
consideration payable under the Offer shall be deemed to be a
reference to the consideration as so reduced.
To the extent that such a dividend or distribution has been
declared but not paid prior to the Offer being declared or becoming
wholly unconditional and such dividend or distribution is
cancelled, then the consideration payable under the Offer shall not
be subject to change in accordance with this paragraph. If the
Offer is declared or becomes wholly unconditional before the
payment date for the Approved Dividend (being 23 March 2017),
Kindred agrees that in no circumstances will it procure or permit
32Red to cancel, revoke, reduce or delay the payment of the
Approved Dividend on 23 March 2017.
Any exercise by Kindred 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 Offer.
9. Kindred reserves the right to elect to implement the
acquisition of the 32Red Shares by way of a Scheme as an
alternative to a Takeover Offer. In such event, the Scheme will be
implemented on the same terms (subject to appropriate amendments),
so far as applicable, as those which could apply to the Offer.
10. The availability of the Offer to persons not resident in the
United Kingdom or Gibraltar may be affected by the laws and
regulations of the relevant jurisdictions. Persons who are not
resident in the United Kingdom or Gibraltar should inform
themselves about and observe any applicable requirements.
11. The Offer 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 jurisdiction where to do so would
violate the laws and regulations of that jurisdiction.
12. Save as provided in the following sentence, the Offer will
be governed by the laws of England and Wales and will be subject to
the exclusive jurisdiction of the English courts and to the
Conditions and further terms set out in this Appendix I and to be
set out in the Offer Document and the Code (in all substantive
respects, unless otherwise agreed by or on behalf of Kindred and
32Red). The Offer will be a Takeover Offer (unless Kindred elects
to implement the Offer by way of a Scheme).
APPIX II
SOURCES OF INFORMATION AND BASES OF CALCULATION
(a) The aggregate Offer value of approximately GBP175.6 million
is based on the Offer price of 196 pence per 32Red Share on the
basis of the fully-diluted number of 32Red Shares in issue referred
to in paragraph (c) below.
(b) At the close of business on 22 February 2017 (being the last
Business Day prior to the date of this announcement), 32Red had in
issue 85,347,528 ordinary shares.
(c) Any reference to the fully-diluted share capital of 32Red is based on:
i. the 85,347,528 32Red Shares referred to in paragraph (b) above; and
ii. the 4,237,008 32Red Shares which may be issued on or after
the date of this announcement on the exercise of options or vesting
of awards under the 32Red Share Plans.
(d) Any reference to the value of the fully-diluted share
capital of 32Red is based on the price of 196 pence per 32Red Share
and the number of 32Red Shares referred to in paragraph (c)
above.
(e) Closing prices for 32Red Shares are taken from
Bloomberg.com. Unless otherwise stated, all closing prices for
32Red Shares are closing middle market prices derived from this
sources.
(f) Volume weighted average closing prices are derived from Bloomberg.com.
(g) Unless otherwise stated, the financial information relating
to 32Red is extracted or derived (without any adjustment) from the
annual results of the 32Red Group for the financial year ended 31
December 2015, prepared in accordance with IFRS.
(h) Unless otherwise stated, the financial information relating
to Kindred is extracted or derived (without any adjustment) from
the 2016 unaudited year-end report for Kindred released on 14
February 2017.
(i) The market capitalisation of Kindred has been translated
from Swedish Krona into pounds sterling using an exchange rate of
GBP1.00 to 11.183 SEK which was derived from Bloomberg.com as at
5.00 p.m. on 22 February 2017 (being the last date prior to the
date of this announcement).
APPIX III IRREVOCABLE UNDERTAKINGS
All of the irrevocable undertakings referred to below include
undertakings to accept (or procure acceptance of) the Offer and, if
Kindred exercises its right to implement the Offer by way of a
Scheme, to vote in favour of the Scheme and any resolution(s)
proposed in order to implement such Scheme:
32Red Directors' Hard Irrevocable Undertakings
Number of 32Red
Shares in respect Percentage of
of which undertaking 32Red issued share
Name of 32Red Director is given capital
------------------------ ---------------------- --------------------
Edward Ware 19,463,419 22.8%
------------------------ ---------------------- --------------------
John Hodgson 5,440,000 6.4%
------------------------ ---------------------- --------------------
Jonathan Hale 1,634,225 1.9%
------------------------ ---------------------- --------------------
David Fish 9,125,000 10.7%
------------------------ ---------------------- --------------------
Patrick Harrison 843,479 1.0%
------------------------ ---------------------- --------------------
Matthew Booth 366,958 0.4%
------------------------ ---------------------- --------------------
David Bowen 120,200 0.1%
------------------------ ---------------------- --------------------
32Red Shareholders' Hard Irrevocable Undertakings
Number of 32Red
Shares in respect Percentage of
of which undertaking 32Red issued share
Name of 32Red Shareholder is given capital
--------------------------- ---------------------- --------------------
32Red plc Employee
Benefit Trust 385,009 0.5%
--------------------------- ---------------------- --------------------
Bonneville Investment
Holdings 10,000,000 11.7%
--------------------------- ---------------------- --------------------
Bruno Callaghan 4,788,054 5.6%
--------------------------- ---------------------- --------------------
Paul Crowther 2,250,000 2.6%
--------------------------- ---------------------- --------------------
Jonathan Richard
Binns 2,000,000 2.3%
--------------------------- ---------------------- --------------------
Campbell family
trust 1,854,632 2.2%
--------------------------- ---------------------- --------------------
The irrevocable undertakings referred to above will only cease
to be binding if:
(a) this announcement has not been issued on or before 5:00 p.m.
(London time) on 24 February 2017 (or such later date as Kindred
and 32Red may agree); or
(b) the Offer lapses or is withdrawn and no new, revised or
replacement Offer (which is no less favourable to the 32Red
Shareholders than the offer set out in this announcement) has been
announced in its place or is announced at the same time; or
(c) if the Offer is implemented by way of a Scheme, the Scheme
terminates or lapses in accordance with its terms or otherwise
becomes incapable of becoming effective; or
(d) the Offer becomes or is declared wholly unconditional (or,
if the Offer is implemented by way of a Scheme, the Scheme becomes
effective).
32Red Shareholders' Soft Irrevocable Undertakings
Number of 32Red
Shares in respect Percentage of
of which undertaking 32Red issued share
Name of 32Red Shareholder is given capital
--------------------------- ---------------------- --------------------
Miton Asset Management 2,430,256 2.8%
--------------------------- ---------------------- --------------------
The above irrevocable undertaking will only cease to be binding
if:
(a) this announcement has not been issued on or before 5:00 p.m.
(London time) on 24 February 2017 (or such later date as Kindred
and 32Red may agree); or
(b) the Offer lapses or is withdrawn and no new, revised or
replacement Offer is announced at the same time; or
(c) a third party makes a competing offer for the entire issued
share capital of 32Red at a value which (in 32Red's reasonable
opinion on the advice of Numis) exceeds the value of the
consideration offered under the terms of the Offer by 10% or more
per 32Red Share; or
(d) in the event that the Offer is implemented by way of a
Scheme, the Scheme terminates or lapses in accordance with its
terms or otherwise becomes incapable of becoming effective; or
(e) the Offer becomes or is declared wholly unconditional (or,
if the Offer is implemented by way of a Scheme, the Scheme becomes
effective).
APPIX IV
DEFINITIONS
The following definitions apply throughout this announcement
unless the context requires otherwise:
"32Red" 32Red plc;
"32Red Board" the board of 32Red Directors;
"32Red Directors" the directors of 32Red;
"32Red Group" 32Red and its subsidiary
undertakings and, where
the context permits, each
of them;
"32Red Share Plans" the 32Red plc Employee
Share Option Plan and
the 32Red plc Long-Term
Incentive Plan;
"32Red Shareholders" the holders of 32Red Shares;
"32Red Shares" the ordinary shares of
0.2 pence each in the
capital of 32Red;
"AIM" the AIM Market operated
by the London Stock Exchange
"AIM Rules" the AIM Rules for Companies
(July 2016) as published
by the London Stock Exchange
which set out the rules
and responsibilities in
relation to a company
with a class of securities
admitted to AIM, as amended
from time to time
"Approved Dividend" the second interim dividend
of 4 pence per 32Red Share
announced by 32Red on
23 February 2017;
"Australia" the Commonwealth of Australia,
its states, territories
and possessions and all
areas subject to its jurisdiction
and any political sub-division
thereof;
"Authorisations" regulatory authorisations,
orders, recognitions,
grants, consents, clearances,
confirmations, certificates,
licences, permissions
or approvals;
"Business Day" a day (other than Saturdays,
Sundays and public holidays
in the UK) on which banks
are open for business
in the City of London
and Gibraltar;
"CET" Central European Time;
"Code" the City Code on Takeovers
and Mergers;
"Companies Act" the UK Companies Act 2006;
"Conditions" the conditions to the
implementation of the
Offer, as set out Appendix
I to this announcement
and to be set out in the
Offer Document;
"Confidentiality Agreement" the confidentiality agreement
entered into between 32Red
and Kindred dated 22 December
2016;
"Data Room" means the information
made available for inspection
in the virtual data room
under the project name
Silver Data hosted via
DropBox;
"Dealing Disclosure" has the same meaning as
in Rule 8 of the Code;
"Disclosed" any information disclosed
by, or on behalf of, 32Red:
(i) in any other announcement
to a Regulatory Information
Service by or on behalf
of 32Red prior to the
publication of this announcement;
or (ii) as otherwise fairly
disclosed in writing (including,
without limitation, in
the Data Room made available
to Kindred and its professional
advisers) by or on behalf
of 32Red or any of its
advisers to Kindred (or
any of its officers, employees,
agents or advisers) prior
to the date of this announcement;
"EBITDA" earnings before interest,
tax, depreciation and
amortisation;
"EU" the European Union;
"Euroclear" Euroclear UK and Ireland
Limited;
"FCA" or "Financial Conduct the Financial Conduct
Authority" Authority acting in its
capacity as the competent
authority for the purposes
of Part VI of the FSMA,
and any successor body
having the same or similar
functions;
"Form of Acceptance" the form of acceptance
and authority relating
to the Offer which will
accompany the Offer Document
for use by 32Red Shareholders;
"FSMA" the UK Financial Services
and Markets Act 2000,
as amended from time to
time and any subordinate
legislation thereto;
"Gaming Regulators" means the Licensing Authority
(Gambling Division) of
HM Government of Gibraltar
and the UKGC;
"Gibraltar Companies Act" the Gibraltar Companies
Act 2014;
"Houlihan Lokey" Houlihan Lokey EMEA, LLP;
"IFRS" International Financial
Reporting Standard;
"ISIN" International Securities
Identification Number;
"Kindred" Kindred Group plc;
"Kindred Group" Kindred and its subsidiary
undertakings and, where
the context permits, each
of them;
"London Stock Exchange" London Stock Exchange
plc or its successor from
time to time;
"Numis" Numis Securities Limited;
"Offer" the recommended cash offer
being made by Kindred
to acquire the entire
issued and to be issued
ordinary share capital
of 32Red to be effected
by means of a Takeover
Offer (or, if Kindred
so elects, by means of
a Scheme) on the terms
and subject to the Conditions
set out in this announcement
and, where the context
admits, any subsequent
revision, variation, extension
or renewal thereof;
"Offer Document" the document to be sent
to 32Red Shareholders
which will contain the
terms and conditions of
the Offer and certain
information about 32Red
and Kindred;
"Offer Period" the period commencing
on the date of this announcement
and ending on the date
on which the "offer period"
(as defined in the Code)
in respect of the Offer
ends;
"Opening Position Disclosure" has the same meaning as
in Rule 8 of the Code;
"Overseas Shareholders" 32Red Shareholders (or
nominees of, or custodians
or trustees for, 32Red
Shareholders) not resident
in, or nationals or citizens
of, the United Kingdom
or Gibraltar;
"Panel" The Panel on Takeovers
and Mergers;
"Panmure Gordon" Panmure Gordon (UK) Limited;
"Regulatory Information any of the services set
Service" out in Appendix III to
the UK Listing Rules;
"Restricted Jurisdiction" any jurisdiction where
the extension or availability
of the Offer would breach
any applicable law;
"Scheme" a scheme of arrangement
under Part VIII of the
Gibraltar Companies Act;
"Significant Interest" in relation to an undertaking,
a direct or indirect interest
of over 20 per cent. of
the total voting rights
conferred by the equity
share capital (as defined
in section 548 of the
Companies Act) of such
undertaking;
"Swedbank" Swedbank AB (publ);
"Takeover Offer" a takeover offer pursuant
to, and in accordance
with, relevant Gibraltar
law, which 32Red and Kindred
have agreed shall be subject
to the Code (in all substantive
respects) as described
in paragraph 16 of this
announcement;
"Third Party" each of a central bank,
government or governmental,
quasi-governmental, suprana-tional,
statutory, regulatory,
environmental, administrative,
fiscal or investigative
body, court, trade agency,
association, institution,
environmental body, employee
representative body or
any other body or person
whatsoever in any jurisdiction;
"UK Gambling Act" the Gambling Act 2005;
"UK Listing Rules" the rules and regulations
made by the Financial
Conduct Authority in its
capacity as the UKLA under
the Financial Services
and Markets Act 2000,
and contained in the UKLA's
publication of the same
name;
"UKGC" the UK Gambling Commission;
"UKLA" the UK Listing Authority,
being the Financial Conduct
Authority;
"United Kingdom" or "UK" the United Kingdom of
Great Britain and Northern
Ireland;
"United States" or "US" the United States of America,
its territories and possessions,
any state of the United
States of America, the
District of Columbia and
all other areas subject
to its jurisdiction and
any political sub-division
thereof;
"US 32Red Shareholders" 32Red Shareholders (or
nominees of, or custodians
or trustees for 32Red
Shareholders) resident
in the US;
"Wider 32Red Group" 32Red and associated undertakings
and any other body corporate,
partnership, joint venture
or person in which 32Red
and such undertakings
(aggregating their interests)
have a Significant Interest;
and
"Wider Kindred Group" Kindred and its associated
undertakings and any other
body corporate, partnership,
joint venture or person
in which Kindred and all
such undertakings (aggregating
their interests) have
a Significant Interest.
For the purposes of this announcement, "subsidiary", "associated
undertaking", "subsidiary undertaking" and "undertaking" have the
respective meanings given thereto by the Companies Act.
All references to "GBP", "pence", and "p" are to the lawful
currency of the United Kingdom.
All the times referred to in this announcement are London times
unless otherwise stated.
References to the singular include the plural and vice
versa.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCPGUQUPUPMGWC
(END) Dow Jones Newswires
February 24, 2017 08:17 ET (13:17 GMT)
32red (LSE:TTR)
Gráfica de Acción Histórica
De Nov 2024 a Dic 2024
32red (LSE:TTR)
Gráfica de Acción Histórica
De Dic 2023 a Dic 2024