TIDMCAL
RNS Number : 0729P
Capital & Regional plc
14 October 2021
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE
UNITED STATES, ANY MEMBER OF THE EUROPEAN ECONOMIC AREA, AUSTRALIA,
CANADA, JAPAN OR NEW ZEALAND OR ANY OTHER JURISDICTION WHERE TO DO
SO MIGHT CONSTITUTE A VIOLATION OF LOCAL SECURITIES LAWS OR
REGULATION.
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
THE COMPANY TO CONSTITUTE INSIDE INFORMATION STIPULATED UNDER THE
MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR") AND THE RETAINED
UK LAW VERSION OF MAR PURSUANT TO THE MARKET ABUSE (AMMENT) (EU
EXIT) REGULATIONS 2019 (SI 2019/310) ("UK MAR"). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION
SERVICE, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE
PUBLIC DOMAIN.
THIS ANNOUNCEMENT IS NOT A PROSPECTUS OR PROSPECTUS EQUIVALENT
DOCUMENT AND INVESTORS SHOULD NOT MAKE ANY INVESTMENT DECISION IN
RELATION TO SHARES IN THE COMPANY EXCEPT ON THE BASIS OF
INFORMATION IN THE PROSPECTUS WHICH IS TO BE PUBLISHED.
14 October 2021
CAPITAL & REGIONAL PLC
(Incorporated in the United Kingdom)
(UK company number 01399411)
LSE share code: CAL JSE share code: CRP
LEI: 21380097W74N9OYF5Z25
ISIN: GB00BL6XZ716
Mall Debt Restructure and Reduction, Launch of Open Offer,
Posting of Prospectus
as well as Notice of General Meeting
Capital & Regional plc (LSE: CAL) ("Capital & Regional",
the "Company", or the "Group"), the UK convenience and community
focused shopping centre REIT, is pleased to announce that it has
reached an agreement with its lenders to restructure and reduce the
debt secured over its four Mall Assets (the "Mall Facility") (the
"Mall Debt Restructuring"), including the launch of a fully
underwritten open offer to raise GBP30.0 million (the "Open
Offer").
Lawrence Hutchings, Chief Executive Officer, comments: "We
recently announced a set of results which clearly demonstrate the
relevance of our Community Centres Strategy, the underlying
strength of our portfolio and the skills and commitment of our
team. Against the backdrop of a positive reopening of the economy
following the disruption caused by the pandemic and increased
confidence in our segment of the retail and services market we have
been focusing our resources on generating the highest returns from
our core Mall investment assets while working closely with our
lenders towards both restructuring and reducing the Group's
debt.
"These proposed transactions, which will recapitalise the
balance sheet, allow us to achieve just that and represent a
significant and positive step forward for the Group. They will
allow us to once again focus fully on continuing our repositioning
and merchandising, while looking at how we can best leverage the
expertise in our platform and, in due course, the reintroduction of
cash dividends."
"I would also like to take this opportunity to thank all of our
stakeholders including our lenders, major shareholders and
Growthpoint, as well as our teams, retailer customers and the local
communities for their continued support throughout the challenges
that the pandemic has presented."
Key Highlights
-- The Mall Facility currently comprises a GBP265 million debt
facility with RBS and TIAA secured over the Four Mall Assets, being
the Mall Blackburn, the Mall Maidstone, the Mall Wood Green and the
Mall Walthamstow. TIAA currently has a balance outstanding of
GBP165 million and RBS has a balance outstanding of GBP100
million.
-- Under the terms of the Mall Debt Restructuring, Capital &
Regional Holdings Limited (the "Purchaser") has agreed to acquire
the GBP100 million of debt outstanding with RBS (the "RBS Debt")
for a principal amount of GBP81 million, representing a discount of
GBP19 million or 19 per cent.
-- The proposed Mall Debt Restructuring will be funded through a combination of:
o TIAA agreeing to acquire from the Purchaser GBP35 million of
the RBS Debt acquired by the Purchaser increasing its lending
secured over the Four Mall Assets from the current GBP165 million
to GBP200 million (the "TIAA Real Estate Facility Agreement") ;
o The raising of GBP30.0 million through the Open Offer at an
issue price of 56p (the "Issue Price") on the pro rata basis of 23
Open Offer Shares for every 48 Existing Ordinary Shares held (the
"Capital Raising"); and
o Approximately GBP16.9 million of cash currently held on the
Company's balance sheet (the "Central Cash").
-- The Capital Raising is being fully underwritten by
Growthpoint, the Company's largest shareholder.
-- The effect of the Mall Debt Restructuring combined with the
Capital Raising would be to reduce the Group's pro forma net LTV as
at 30 September 2021 from 61 per cent. to approximately 50 per
cent. on the basis of the Group's Investment Assets and Central
Operations or from 72 per cent. to 63 per cent. on a total Group
basis.
-- Under the terms of the Mall Debt Restructuring a waiver of
all financial covenants in the Mall Facility will be provided for
two years from the date that the TIAA Real Estate Facility
Agreement becomes effective and further modifications made to cash
trap covenants for 18 months from the date that such agreement
becomes effective.
-- Assuming rental income returns to a more normalised basis, it
is the Company's objective to resume, in line with UK REIT
requirements, the distribution of cash dividends in respect of the
second half of 2022.
-- Completion of the Capital Raising is conditional, amongst
other things, upon the approval of Shareholders at a general
meeting of the Company which will take place at 2.00 p.m. on 1
November 2021 at 110 Rochester Row, Westminster, London, SW1P 1JQ
(the "General Meeting").
-- Growthpoint which is interested in 58,261,066 Existing
Ordinary Shares as at the Latest Practicable Date (representing 52
per cent. of the Company's issued ordinary share capital) has
undertaken to the Company to vote or procure that its Nominees vote
in favour of all Resolutions at the General Meeting.
Posting of Prospectus
The Company also confirms that a prospectus, which contains
further details regarding the Open Offer and the Mall Debt
Restructuring and a notice convening the General Meeting (the
"Prospectus"), will be posted to Shareholders later today, along
with the Application Form (where applicable). The Prospectus will
be available shortly from the National Storage Mechanism via
https://data.fca.org.uk/#/nsm/nationalstoragemechanism and also,
subject to certain access restrictions, on the Company's website
https://capreg.com/ .
Notice of General Meeting
The General Meeting has been convened for 2.00 p.m. UK time on 1
November 2021 at 110 Rochester Row, Westminster, London, SW1P 1JQ
in order to approve the Resolutions to enable, amongst other
things, the Capital Raising.
Investec Bank plc is acting as financial adviser and sponsor and
Investec Bank Limited is acting as JSE sponsor (Investec Bank plc
and Investec Bank Limited together, "Investec"). Numis Securities
Limited ("Numis") is broker to the Company.
There will be a call for analysts at 08.30 a.m. UK time this
morning, please contact FTI Consulting using the details below if
you would like to attend.
For further information please contact:
Capital & Regional plc
Lawrence Hutchings, Chief Executive Officer
Stuart Wetherly, Chief Financial Officer +44 207 932 8000
Investec (Financial Adviser, Sponsor and JSE
Sponsor)
Charles Barlow / David Anderson / Ben Farrow
Karl Priessnitz / Kyle Rollinson +44 207 597 5970
Numis Securities Limited (Broker)
Ben Stoop / Dipayan Chakraborty +44 207 260 1000
FTI Consulting (Communications Advisory Firm) +44 203 727 1000
Richard Sunderland / Claire Turvey capreg@fticonsulting.com
IMPORTANT NOTICES
This Announcement and the information contained in it is
restricted and is not for release, publication or distribution, in
whole or in part, directly or indirectly into jurisdictions other
than the United Kingdom and South Africa and may be restricted by
law. Persons into whose possession this Announcement comes should
inform themselves about and observe any such restrictions. Any
failure to comply with these restrictions may constitute a
violation of the securities laws of any such jurisdiction. To the
fullest extent permitted by applicable law, each of the persons
involved in the Capital Raising disclaim any responsibility or
liability for the violation of such restrictions by any person. In
particular, copies of this Announcement are not being, and must not
be, directly or indirectly, mailed or otherwise forwarded,
distributed or sent in, into or from any jurisdiction where to do
so would or might contravene local securities laws or
regulations.
Investec Bank plc, which is authorised and regulated in the
United Kingdom by the Financial Conduct Authority, is acting as
Sponsor and financial adviser in relation to the Capital Raising
exclusively for the Company and no one else in connection with the
matters referred to in this Announcement, and will not be
responsible to anyone other than the Company for providing the
protections afforded to its clients, for the contents of this
Announcement or for providing any advice in relation to the Capital
Raising, the contents of this Announcement or any other matter
referred to in this Announcement.
Investec Bank Limited, which is authorised and regulated in
South Africa by, inter alia, the Financial Sector Conduct
Authority, is acting as JSE Sponsor in relation to the Capital
Raising exclusively for the Company and no one else in connection
with the matters referred to in this Announcement, and will not be
responsible to anyone other than the Company for providing the
protections afforded to its clients, for the contents of this
Announcement or for providing any advice in relation to the Capital
Raising, the contents of this Announcement or any other matter
referred to in this Announcement.
Numis Securities Limited, which is authorised and regulated by
the Financial Conduct Authority in the United Kingdom, is acting
exclusively for the Company and no-one else in connection with the
Capital Raising and any other matters referred to in this
Announcement, and will not regard any other person as its client in
relation to such matters and will not be responsible to anyone
other than the Company for providing the protections afforded to
clients of Numis or for providing advice in relation to the Capital
Raising, the contents of this Announcement or any other matter
referred to in this Announcement.
This Announcement is for information purposes only and does not
constitute an offer to sell or an invitation to purchase any
securities or the solicitation of an offer to buy any securities,
pursuant to the Capital Raising or otherwise in any jurisdiction.
The Capital Raising is being made solely pursuant to the terms of
the Prospectus which contains the full terms and conditions of the
Open Offer, and in the case of Company shares held in certificated
form on the UK Register, the Form of Acceptance. The terms and
conditions of the Open Offer for Company shares held in
certificated form on the SA Register is set out in the
Supplementary Information Memorandum. This Announcement includes
statements that are, or may be deemed to be, forward-looking
statements. These forward-looking statements can be identified by
the use of forward-looking terminology, including the terms:
"anticipates", "believes", "estimates", "expects", "intends",
"may", "plans", "projects", "should" or "will", or, in each case,
their negative or other variations or comparable terminology, or by
discussions of strategy, plans, objectives, goals, future events or
intentions. These forward-looking statements include all matters
that are not historical facts. They appear in a number of places
throughout this Announcement and include, but are not limited to,
statements regarding the Company's and/or Directors' intentions,
beliefs or current expectations concerning, amongst other things,
the Group's results of operations, financial position, prospects,
growth, strategies and expectations for the retail property market.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on
circumstances that will occur in the future.
No statement in this Announcement is intended as a profit
forecast or estimate for any period.
This Announcement has not been approved by the Financial Conduct
Authority or the London Stock Exchange.
THE FOLLOWING IS AN EXTRACT FROM THE CHAIRMAN'S LETTER
introduction
The Company has for some time been dealing with the challenge of
the major structural changes in the retail industry, which has had
a negative impact on the value of the Group's assets. This industry
wide challenge has been materially exacerbated by the effects of
the Covid-19 pandemic accelerating these underlying longcycle
structural shifts in the sector and altering the balance between
physical and online retailing. The measures put in place by the UK
Government to manage the pandemic put significant pressure on the
Group's income as a number of stores in the shopping centres were
forced to close for an extended period of time, leading to a number
of retailers withholding rent payments and a significant reduction
in non-contracted revenue including car park income. The
combination of these factors and continuing negative sentiment to
the retail sector have also negatively impacted the value of the
Group's assets further. This has put significant pressure on the
Group's leverage and management have been forced in recent
financial periods to seek covenant waivers on an ongoing basis from
the Group's lenders, which have been granted.
The Board continues to believe that the combination of its
community centre strategy, which had clear sight of the structural
changes, and focus on local destinations providing
non-discretionary goods and services has never been more relevant.
In light of this the Board has sought to stabilise the Group by
focusing its resources on maximising returns from its core Mall
investment assets whilst supporting its managed assets.
The Company announced on 14 October 2021 that it had reached
agreement with its lenders and, Growthpoint, its largest
Shareholder, to undertake the Proposed Transaction that will, when
implemented, restructure and reduce the Group's level of
indebtedness significantly strengthening the Group's financial
position, and allowing management to focus on delivering their
strategy and in turn target delivering positive returns for
Shareholders.
The Company's objective with the proceeds from the Capital
Raising is to restructure the existing Mall Facility. The Mall
Facility currently comprises a GBP265 million debt facility with
RBS and TIAA secured over the Four Mall Assets, being the Mall
Blackburn, the Mall Maidstone, the Mall Wood Green and the Mall
Walthamstow. Currently, TIAA has a balance outstanding of GBP165
million and RBS has a balance outstanding of GBP100 million.
Under the terms of the Mall Debt Restructuring Capital &
Regional Holdings Limited (the "Purchaser") has agreed to acquire
the GBP100 million of debt outstanding with RBS (the "RBS Debt")
for a principal amount of GBP81 million, representing a discount of
GBP19 million or 19 per cent.
The proposed Mall Debt Restructuring will be funded through a
combination of:
-- TIAA agreeing to acquire from the Purchaser GBP35 million of
the RBS Debt acquired by the Purchaser, increasing its lending
secured over the Four Mall Assets from the current GBP165 million
to GBP200 million;
-- Proceeds received via the proposed Capital Raising; and
-- Approximately GBP16.9 million of Central Cash held on the Company's balance sheet.
In addition the Purchaser and Mall LP have agreed they will
terminate the interest rate swap held in connection with the GBP100
million of debt outstanding with RBS at 81 per cent. of its market
value. As at the Latest Practicable Date the swap was valued at
GBP1.2 million which would equate to a payment at completion of
GBP1.0 million.
The effect of the Mall Debt Restructuring combined with the
Capital Raising would be to reduce the Group's pro forma net LTV as
at 30 June 2021 from 61 per cent. to approximately 50 per cent. on
the basis of the Group's Investment Assets and Central Operations
or from 72 per cent. to 63 per cent. on a total Group basis.
Under the terms of the Mall Asset Facility Amendment and
Restatement Agreement a waiver of all financial covenants in the
Mall Facility will be provided for two years from the date that the
Mall Asset Facility Amendment and Restatement Agreement becomes
effective following the Purchaser's acquisition of the RBS Debt and
TIAA's acquisition of GBP35 million of the RBS Debt from the
Purchaser and various relaxations will also be made to cash trap
covenants for 18 months from the date that such agreement becomes
effective.
Assuming, therefore, rental income returns to a more normalised
basis, it is the Company's objective to return to operating in line
with UK REIT requirements and resuming the distribution of cash
dividends in respect of the second half of the financial year
ending 2022.
SUMMARY OF TERMS OF THE MALL DEBT RESTRUCTURING
The Group, through its wholly owned limited partnership, the
Mall LP, currently has in place the Mall Facility which is a GBP265
million debt facility with RBS and TIAA, secured over the Four Mall
Assets, being the Mall Blackburn, the Mall Maidstone, the Mall Wood
Green and the Mall Walthamstow. Under the terms of the Mall
Facility, TIAA has a balance outstanding of GBP165 million and RBS
has a balance outstanding of GBP100 million. Under the terms of the
Mall Debt Restructuring, RBS has agreed to sell its GBP100 million
share of the Mall Facility (the "RBS Balance") to Capital &
Regional Holdings Limited (the "Purchase") for a principal amount
of GBP81 million i.e. at a discount of GBP19 million. TIAA has
agreed to acquire from the Purchaser of GBP35 million of the RBS
Balance acquired by the Purchaser to partially fund the purchase of
the RBS Balance TIAA will therefore be increasing its total lending
to the Group from the current GBP165 million to GBP200 million. The
remainder of the RBS Balance will be met from Central Cash and the
funds raised through the Capital Raising.
In addition the Purchaser and Mall LP have agreed to terminate
the interest rate swap held in connection with the GBP100 million
of debt outstanding with RBS at 81 per cent. of its market value.
As at the Latest Practicable Date the swap was valued at GBP1.2
million which would equate to a payment at completion of GBP1.0
million.
As a result of the above steps the Group will have effectively
reduced its borrowings on the Four Mall Assets from GBP265 million
pursuant to the Mall Facility (which will no longer be in place) to
GBP200 million.
The ongoing terms of the Mall Facility Agreement will, on
completion of the transactions referred to above be amended and
restated in accordance with the Mall Asset Facility Amendment and
Restatement Agreement. Further details of the Mall Asset Facility
Amendment and Restatement Agreement are set out in paragraph 9.3 of
Part 9 of the prospectus.
SUMMARY OF TERMS OF THE CAPITAL RAISING
The Capital Raising is being implemented by way of an open
offer. The Company is proposing to raise proceeds of approximately
GBP27.4 million (net of fees, costs and expenses) by way of an open
offer of 53,580,237 Open Offer Shares.
Qualifying Shareholders are being given an opportunity to apply
for Open Offer Shares at the Issue Price on the following pro rata
basis: 23 Open Offer Shares at 56 pence each for every 48 Existing
Ordinary Shares held and registered in their name at the Record
Date.
The Issue Price represents a 2.4 per cent. discount to the
Closing Price of 57.4 pence per Ordinary Share as at the Latest
Practicable Date.
The Open Offer Shares, when issued and fully paid, will rank
pari passu in all respects with the Existing Ordinary Shares,
including the right to receive dividends or distributions made,
paid or declared after the date of issue of the Open Offer Shares,
save in respect of any dividend or distribution with a record date
falling before the date of issue of the Open Offer Shares. The Open
Offer Shares will be denominated in Sterling.
Subject to various conditions referred to below, Growthpoint,
the Company's major shareholder, has agreed to subscribe in cash at
the Issue Price, for its full Open Offer Entitlements in full,
being 27,916,761 Open Offer Shares. Growthpoint has also agreed to
underwrite the Capital Raising by subscribing for such number of
Open Offer Shares as are not taken up by Qualifying Shareholders
under the Open Offer. Immediately following completion of the
Capital Raising, and if no Open Offer Shares were taken up by
Qualifying Shareholders under the Open Offer, Growthpoint would
hold approximately 67.6 per cent. of the Enlarged Share
Capital.
The aggregate net proceeds of the Capital Raising, after
deduction of expenses, are expected to be approximately GBP27.4
million.
Applications will be made to: (i) the FCA for the Open Offer
Shares to be admitted to listing on the premium segment of the
Official List and (ii) an application will be made to the London
Stock Exchange for the Open
Offer Shares to be admitted to trading on the Main Market and
the JSE for the Open Offer Shares to be listed and traded on the
Main Board of the JSE. It is expected that UK Admission will become
effective and that dealings in the Open Offer Shares will commence
on the Main Market at 8.00 a.m. (London time) on 5 November 2021
and that SA Admission will become effective and that dealings in
the Open Offer Shares will commence on the Main Board of the JSE at
10.00 a.m. (South African time) on 5 November 2021.
The Open Offer Shares will be in registered form and from
Admission will be capable of being held in uncertificated form and
title to such shares may be transferred by means of a relevant
system (as defined in the CREST Regulations). The Open Offer Shares
will be admitted with the ISIN GB00BL6XZ716 and SEDOL (Stock
Exchange Daily Official List) number BL6XZ71 and LEI
21380097W74N9OYF5Z25, being the same ISIN, SEDOL and LEI under
which the Existing Ordinary Shares are admitted.
The Open Offer
Details of the Open Offer
Under the Open Offer, 53,580,237 Open Offer Shares will be made
available to Qualifying Shareholders at the Issue Price pro rata to
their holdings of Existing Ordinary Shares, on the terms and
subject to the conditions of the Open Offer on the basis of:
23 Open Offer Share for every 48 Existing Ordinary Shares
held and registered in their name at the Record Date.
There is no excess application facility in respect of the Open
Offer.
Qualifying Shareholders may apply for any whole number of Open
Offer Shares subject to the limit of their Open Offer Entitlements.
In the case of Qualifying Non-CREST Shareholders, the Open Offer
Entitlements is equal to the number of Open Offer Entitlements as
show in Box 1 on their Application Forms, or in the case of
Qualifying CREST Shareholders, is equal to the number of Open Offer
Entitlements standing to the credit of their stock accounts in
CREST.
Shareholders should be aware that the Open Offer is not a rights
issue. As such, Qualifying Non-CREST Shareholders should note that
their Application Forms are not negotiable documents and cannot be
traded. Qualifying CREST Shareholders should note that, although
the Open Offer Entitlements will be admitted to CREST and enabled
for settlement, the Open Offer Entitlements will not be tradeable
or listed and applications in respect of the Open Offer may only be
made by the Qualifying Shareholder originally entitled or by a
person entitled by virtue of a bona fide market claim. Open Offer
Shares for which application has not been made under the Open Offer
will not be sold in the market for the benefit of those who do not
apply under the Open Offer and Qualifying Shareholders who do not
apply to take up their entitlements will have no rights, and will
not receive any benefit, under the Open Offer.
The latest time and date for acceptance and payment in full in
respect of the Open Offer will be 11.00 a.m. on 29 October 2021.
Valid applications under the Open Offer will be satisfied in full
up to an applicant's Open Offer Entitlements (rounded down to the
nearest whole number).
Details of the entitlements for Qualifying Shareholders on the
SA Register are set out in the Supplementary Information
Memorandum.
Not all Shareholders will be Qualifying Shareholders. In
particular, Overseas Shareholders who are located in, or are
citizens of, or have a registered office in an Excluded Territory
will not qualify to participate in the Open Offer.
The terms and conditions of application under the Open Offer for
Qualifying Shareholders on the UK Register are set out in Part 3 of
the prospectus and in the case of Qualifying Non-CREST
Shareholders, the Application Form. The terms and conditions of
application for Qualifying Shareholders on the SA Register are set
out in the accompanying Supplementary Information Memorandum. These
terms and conditions should be read carefully before an application
is made. Shareholders who are in any doubt about the Open Offer
arrangements should consult their stockbroker, bank manager,
solicitor, accountant or other duly authorised appropriate
financial adviser.
Applications under the Open Offer are not subject to any minimum
subscription requirement.
To the extent that Open Offer Shares remain unallocated pursuant
to the Open Offer, they will be subscribed for by Growthpoint
subject to the terms and conditions set out in the Underwriting
Agreement.
The Open Offer Shares will be issued in registered form and may
be held in either certificated or uncertificated form. In the case
of Open Offer Shares held in uncertificated form, the Articles
permit the holding and transfer of Open Offer Shares under CREST.
CREST is a paperless settlement procedure enabling securities to be
evidenced otherwise than by certificate and transferred otherwise
than by written instrument. The Directors will apply for the Open
Offer Shares to be admitted to CREST. The records in respect of
Open Offer Shares held in uncertificated form will be maintained by
Euroclear, the Registrar and the Receiving Agent (details of whom
are set out on page 33 of the prospectus).
The transfer of Open Offer Shares out of the CREST system
following the Capital Raising should be arranged directly through
CREST. However, an investor's beneficial holding held through the
CREST system may be exchanged, in whole or in part, only upon the
specific request of the registered holder to CREST for share
certificates or an uncertificated holding in definitive registered
form. If a Shareholder or transferee requests Open Offer Shares to
be issued in certificated form and is holding such Open Offer
Shares outside CREST, a share certificate will be dispatched either
to him, her or it or his, her or their nominated agent (at his, her
or its risk) within 21 days of completion of the registration
process or transfer, as the case may be, of the Open Offer Shares.
Shareholders holding definitive certificates may elect at a later
date to hold such Open Offer Shares through CREST or in
uncertificated form provided they surrender their definitive
certificates.
Underwriting Arrangements
Subject to the terms and conditions of the Underwriting
Agreement, Growthpoint has agreed to subscribe in cash at the Issue
Price, for its full Open Offer Entitlements. Growthpoint has also
agreed to underwrite the Capital Raising by subscribing in cash at
the Issue Price for any Open Offer Shares which remain unallocated
pursuant to the Open Offer.
The obligations of Growthpoint under the Underwriting Agreement
are subject to certain conditions including:
(a) the FCA having approved the prospectus for despatch to Shareholders;
(b) the despatch of the prospectus to Shareholders (other than
those who the Company determines are not entitled to receive
copies);
(c) the passing (without amendment) of the Capital Raising Resolution at the General Meeting;
(d) an application being made to Euroclear UK & Ireland to
admit the Open Offer Shares to CREST; (e) Admission occuring;
(f) the Government of South Africa or the South African Reserve
Bank not imposing exchange controls which make it unlawful or
impossible for Growthpoint to meet its obligations under the
Underwriting Agreement or the Open Offer; and
(g) the agreements for the acquisition of part of the Mall Facility not having been terminated.
Growthpoint can also meet its subscription and underwriting
obligations in whole or in part through the Growthpoint Nominees.
Immediately following completion of the Capital Raising, and if no
Open Offer Shares were taken up by Qualifying Shareholders under
the Open Offer, Growthpoint would hold approximately 67.6 per cent.
of the Enlarged Share Capital.
A summary of the principal terms of the Underwriting Agreement
is set out in paragraph 9.2 of Part 9 of the prospectus.
Further Information
Further details of the terms and conditions of the Capital
Raising, including the procedure for acceptance and payment are set
out in Part 3 of the prospectus and, where relevant, the
Application Form.
BACKGROUND TO AND REASONS FOR THE PROPOSED TRANSACTION
The global Covid-19 pandemic has accelerated the structural
changes that were already underway within the UK retail sector.
High street retail has faced a considerable amount of pressure as a
result of the UK's uncertain macro-economic backdrop and structural
changes in retailing driven by technology, particularly online
shopping. This has also been the case in the UK shopping centre
market which is rapidly evolving with increasing polarisation
between discretionary focused centres, typically anchored by major
department stores with a large fashion presence and increasingly
entertainment uses, and non-discretionary focused centres, such as
those owned by the Group, anchored by grocery, professional and
personal services including health and beauty and day-to-day
services. While the Group's strategic focus on non-discretionary
goods and services has seen it perform well operationally on a
relative basis, the pace of structural change has resulted in
continuing pressure on both revenues and property valuations.
The Covid-19 pandemic has created significant global economic
uncertainty and has had a materially adverse impact across key
retail markets. UK retail market spend declined by 3.9 per cent.
(GBP13.5 billion) to GBP330.5 billion over 2020 and UK GDP fell by
9.9 per cent. over 2020. Unemployment had risen to 5.1 per cent. by
the end of December 2020, with 3.8 million jobs still on the
government job retention scheme. Home working and stay at home
guidance has seen an acceleration in online shopping, which in 2020
accounted for 26.2 per cent. of retail market share, up from 17.2
per cent. in 2019. ([1])
However, despite the restrictions on non-essential retail,
physical retailing still accounted for 73.8 per cent., of retail
market share in 2020. Food and grocery, a key part of the Group's
community merchandising and positioning strategy, performed
strongly; and retailers with an established and well-developed
omni-channel offer have seen sales growth, providing some
mitigation to the reduction of in-store sales. The centres benefit
from strategic locations in town centres with strong transport
links, benefit from affordable occupancy costs and are supported by
their local communities.
The Board believes that the Group is well positioned to
capitalise on the changes taking place in the industry by focusing
on retail categories, such as non-discretionary retail and
services, which are more defensive to the structural changes driven
by online retailing affecting the wider retail sector, affordable
rents and convenience locations which serve the daily 'needs'
rather than the 'wants' of underlying communities. The Covid-19
pandemic has seen an increased focus on the community; staying
local, working local and shopping local. The Board believes
elements of these changes will remain as the UK emerges from the
pandemic and its shopping centre locations in the heart of town
centres are ideally placed to benefit from this evolving
live/work/shop dynamic.
Operational performance
Whilst all seven of the Group's community shopping centres
remained open through the various UK Government imposed lock-downs,
at times when non-essential retailers have been required to close
only approximately a third of units have been able to trade. The
multi-phased approach to lifting restrictions by the UK Government
meant that over time occupiers were able to open initially with
social distancing requirements, and since June 2021, 99 per cent.
of the Group's leased units were back open and trading. Up until 12
April 2021, the date on which non-essential retailers were able to
re-open, approximately one third of leased units were open and
trading and footfall was at approximately 30 per cent. of the
equivalent weeks in 2019. At the time of publishing the Interim
Results on 9 September 2021 the Group disclosed that in the 20
weeks since the full re-opening, footfall was approximately 70 per
cent. of the corresponding weeks in 2019.
Both the enforced restrictions of lock-downs, together with the
closures of certain retailers, meant that naturally footfall across
the Group's portfolio suffered as a result.
Despite the challenges impacting the retail sector, together
with a number of retailers including Debenhams going into
administration during the pandemic, occupancy across the Group's
estate has remained robust throughout and as at 30 June 2021 was 90
per cent..
The Group has made good progress in re-letting the three
Debenhams units which closed in April 2021 following Debenham's
administration. Plans to break up the Ilford unit across its three
floors are progressing with a lease signed to let the majority of
the top floor space for a new Job Centre. Terms have been agreed on
a relocation of a national retailer into the middle floor and the
Group is pursuing options, including grocery, on the ground floor
level. At Blackburn a letting has been concluded for a new Job
Centre taking up approximately 15,000 sq ft of the space.
Discussions are ongoing with different operators about letting the
balance of space. At Luton, the Group has agreed a deal on a
medium-term basis to let the entirety of the unit which will cover
costs with a turnover top-up with break options to maintain
flexibility for a permanent solution.
Political uncertainty caused by concern regarding Brexit and
trading uncertainty caused by the Covid-19 pandemic contributed to
a slowing of leasing momentum in 2020. However, strong progress was
still made in securing a number of key deals across the portfolio
and leasing volumes achieved in 2020 were equivalent to those in
2019 and at combined average premiums to passing rent and ERV.
Leasing progress has been encouraging following the first stage of
the lifting of the UK Government pandemic restrictions on 12 April
2021. As at 30 June 2021, 54 new lettings and renewals have been
completed for a combined value of GBP1.4 million. The Board
believes this reflects both the increased focus and investment of
the Group's commercial team and because retailers continue to be
attracted to the Group's strategy and community centres, including
the affordable and sustainable rents at GBP12-GBP15 per square
foot.
Rent collection
The Group's retailer customers' ability to trade was impacted
throughout the Covid-19 pandemic by the various restrictions that
were put in place. In addition the UK Government's introduction of
a rent moratorium compromised the measures the Group would normally
have available as a last resort to protect its contractual
positions; particularly in the unfortunate cases where some large
well-funded retailers were able, but unwilling, to pay. In
response, management dedicated significant resource to this area,
assembling a team from across the business to best utilise
relationships with the tenant base at all levels. The Group has
worked closely with its retailers to understand the specific impact
of the Covid-19 pandemic on their individual businesses, seeking to
come to agreements that amicably resolve the position and
appropriately share the cost of periods when retailers have been
unable to operate. These agreements have typically provided some
form of a modest concession related to the period during which the
retailer was unable to trade in return for settling the remainder
of their rent arrears and their service charge obligations in
full.
As a result of this focus on rent collection, as at the time of
publishing the Interim Results on 9 September 2021, the Group had
collected approximately 88 per cent. of the rent due for the
financial year ending 30 December 2020. This is an improvement of
approximately 8 per cent. from the position at the time of
announcing the Company's results for the financial year ending 30
December 2020 on 9 March 2021.
Property portfolio valuation
As at 30 June 2021 the Group changed its reportable segments
reflecting the position of its shopping centre investments. As a
result, the Group has split out what was previously referred to as
Shopping Centres into 'Shopping Centres - Investment Assets' and
'Shopping Centres - Managed Assets'.
'Shopping Centres - Investment Assets' incorporates the centres
at the Exchange, Ilford and within the Mall Facility, namely the
Mall Blackburn, the Mall Maidstone, the Mall Walthamstow and the
Mall Wood Green. These represent the asset pools where the Group
retains net equity and is focussed on long-term solutions for the
loan positions potentially involving the investment of further
capital.
'Shopping Centres - Managed Assets' incorporates Hemel Hempstead
and the Mall Luton where the current loan balances in the
non-recourse special purpose vehicle structures exceed the
respective property values and therefore the Group has negative
equity and the substance of the Group's involvement as a manager
and the future position of the investments is uncertain. The Group
has determined that the economic and strategic rationale for
additional investment to cure and/or to pay down these non-recourse
facilities is, at the present time, insufficient. The Group
continues to manage these assets for the time being, whilst various
outcomes are explored in conjunction with the lenders.
30 September 30 June 30 December
2021 2021 2020
Shopping GBPm NIY GBPm NIY GBPm NIY
Centres
-
Investment
Assets
Exchange,
Ilford 56.40 5.84% 54.8 4.60% 60.0 5.30%
Mall
Blackburn 38.50 12.41% 38.8 11.61% 40.6 13.17%
Mall
Maidstone 43.00 10.76% 43.0 10.97% 46.0 10.67%
Mall
Walthamstow 100.40 5.88% 100.4 5.79% 106.6 5.17%
Mall Wood
Green 148.20 7.50% 147.7 7.33% 158.0 6.71%
---------- ---------- ---------- ---------- ---------- ----------
Shopping
Centres
-
Managed
Assets 386.50 7.78% 384.7 7.45% 411.2 7.28%
Mall Luton
Marlowes, 82.00 10.54% 84.0 9.59% 92.5 9.8%
Hemel
Hempstead 11.00 11.37% 14.0 11.24% 23.3 10.0%
---------- ---------- ---------- ---------- ---------- ----------
93.00 10.66% 98.0 9.81% 115.8 9.80%
---------- ---------- ---------- ---------- ---------- ----------
Portfolio 479.50 8.37% 482.7 7.96% 527.0 7.88%
-------------------- -------------------- -------------------- -------------------- -------------------- --------------------
As a result of the factors outlined above there has been
significant pressure on the Group's property valuations which is a
feature consistent across the UK shopping centre industry. As at 30
June 2021, the Group's property portfolio was valued at GBP482.7
million compared to GBP527 million as at 31 December 2020;
representing a decline of approximately 7.5 per cent. on a like for
like basis adjusting for the sale of the Edmonds Parade block that
was part of the Marlowes, Hemel Hempstead. This is a slowing in the
rate of decline experienced in 2020 where the valuation of the
Group's assets fell by GBP200.1 million or 27.5 per cent. The
Group's Investment Assets, supported by their London centres, have
fared relatively better declining by 6.44 per cent. over the six
month period, to 30 June 2021.
As at 30 September 2021, the Group's property portfolio was
valued at GBP479.5 million compared to GBP482.7 million as at 30
June 2021. The valuation of the Group's Investment Assets was
GBP386.5 million at 30 September 2021, compared to GBP384.7 million
at 30 June 2021.
Following the removal of all UK Government restrictions related
to the Covid-19 pandemic in July 2021, the Directors expect that
the downward trend in the Group's property valuations is likely to
continue to stabilise in the short term. This is based on the
limited transactional data points in the retail property sector,
which provide some evidence that valuations of certain types of
assets are better than expected, and the improving momentum in the
Group's rent collections.
Group debt facilities
Property Net debt
GBPm as at 30 June 2021 Cash Net debt valuation LTV LTV
Debt
Investment Assets
Four Mall Assets 265.0 (7.9) 257.1 329.9 80% 78%
Exchange, Ilford 39.0 (2.8) 36.2 54.8 71% 66%
Group Central debt/(cash)
- (56.8) (56.8) - n/a n/a
--------- Group's ---------- ---------- ---------- ---------- ----------
Investment
Assets
and Central Operations
304.0
Managed Assets
Marlowes Hemel (67.5) 236.5 384.7 79% 61%
Hempstead 23.0 (0.6) 22.4 14.0 164% 160%
Mall Luton 96.5 (7.4) 89.1 84.0 115% 106%
---------- ---------- ---------- ---------- ---------- ----------
Group 423.5 (75.5) 348.0 482.7 88% 72%
The Group has four non-recourse asset secured loan facilities
that each sit within their own ring-fenced special purpose vehicle
("SPV") structure. The Group is relatively heavily indebted given
the capital-intensive nature of asset ownership and as at 30 June
2021, the Group had net debt of GBP348.0 million. The fall in
valuations of the Group's properties as described above resulted in
a Group net LTV ratio of 61 per cent. on the basis of the Group's
Investment Assets and Central Operations or 72 per cent. (compared
to 65 per cent. as at 31 December 2020) on a total Group basis.
On the Mall Facility, the Group has obtained a waiver of all
financial covenants until the IPD at the end of January 2022.
On the Exchange, Ilford, the Group has secured a waiver of all
financial covenants until the April 2022 IPD in return for the
Group funding from Central Cash landlord works and incentives of
GBP1.1 million to facilitate the creation of a Job Centre in part
of the former Debenhams unit. The Group has also agreed outline
terms on a longer term modification of the covenants until at least
the end of 2022 to facilitate the completion of the proposed major
asset management initiatives at the asset, being the planned
medical centre and the re-letting of the remainder of the Debenhams
anchor unit, which, if they proceed, the Group will partially fund
from Central Cash. The estimated capital expenditure spend on the
two projects are GBP6.7 million and GBP5.9 million
respectively.
On the Mall Luton loan facility, the Group is in the final
stages of agreeing terms on a further extension to the waiver until
the January 2022 IPD. The Group has advanced its discussions with
the lender about: (a) resetting the covenant position; (b) enacting
certain modifications to the loan agreement and (c) agreeing the
scope of the Group's asset management activities in return for
instituting a mechanism to apply surplus cash generated at the
asset to the gradual reduction of the loan balance. The Group
anticipates that this arrangement will be formalised to facilitate
a stabilisation of the operating performance of the asset, whilst
broader strategic alternatives are evaluated.
On Hemel Hempstead financial covenants on the loan facility are
currently deferred until the October 2021 IPD. The lender on Hemel
Hempstead is in the final states of selling the loan as part of a
portfolio of other unrelated debt facilities. The Group intends to
continue its constructive engagement with the lender, or any
successor lender, to regularly assess whether it is in the Group's
interest to retain an ongoing involvement in relation to the
asset.
The Group intends to utilise the net proceeds of the Capital
Raising, together with approximately GBP16.9 million of Central
Cash to undertake the Mall Debt Restructuring as described above.
The effect of this would be to reduce the Group's pro forma net LTV
as at 30 June 2021 from 61 per cent. to approximately 50 per cent.
on the basis of the Group's Investment Assets and Central
Operations or 72 per cent. to approximately 63 per cent. on a total
Group basis.
Dividends
As a result of the significant reductions to the Group's
revenues and, therefore, cash flows, during the Covid-19 pandemic,
coupled with restrictions in the Group's banking facilities, the
Company paused cash dividend payments in 2020. As a result of the
Proposed Transaction, restrictions to passing cash flow up to the
Company from its core Mall Facility will be removed. Therefore,
assuming rental income returns to a normalised basis, the Company
should be capable of distributing limited cash dividends to
Shareholders during the second half of the financial year ending 30
December 2022.
Conclusion
Overall the Board believes that the recommended Proposed
Transaction will allow the Group to achieve the best outcome for
Shareholders. The Proposed Transaction will allow the executive
management team to continue to pursue its growth strategy, continue
delivering sound levels of operational performance of its assets,
pursue leasing and asset repositioning opportunities as well as
improving balance sheet strength. The Board is also fully cognisant
that a very wide range of possible retailer and economic outcomes
remain, therefore, it is important that the Company and the Group
have robust balance sheets and the Proposed Transaction provides
this.
Without the Proposed Transaction, the Group would need to take
various actions in the short term to preserve cash, enter into
negotiations with its lenders to extend the covenant waivers
currently in place, potentially including the need to realise cash
from asset sales from the Group's portfolio to reduce the Group's
leverage and put on hold its capital expenditure programme.
Accordingly, such actions would compromise the Group's competitive
position and growth prospects.
USE OF PROCEEDS
The Capital Raising will deliver proceeds of approximately
GBP30.0 million (before costs) and net proceeds of approximately
GBP27.4 million to the Company. The Group intends to utilise the
net proceeds of the Capital Raising, together with approximately
GBP16.9 million of Central Cash, to repay part of the Mall Facility
as described above.
Approximately GBP2.6 million of the proceeds from the Capital
Raising will be used to pay fees and expenses incurred in
connection with the Proposed Transaction.
EFFECTS OF IMPLEMENTATION OF THE PROPOSED TRANSACTION
Group Leverage
As a result of the Proposed Transaction, the Group's pro forma
net LTV as at 30 June 2021 will reduce from 61 per cent. to
approximately 50 per cent. on the basis of the Group's Investment
Assets and Central Operations, or from 72 per cent. to 63 per cent.
on a total Group basis.
On a pro forma basis and assuming the net proceeds from the
Capital Raising were GBP27.4 million, the Group would have had net
assets of GBP173.3 million at 30 June 2021, as extracted from the
unaudited pro forma statements of the net assets of the Group at
Section A of Part 7 of the prospectus.
Dilutionary impact of the Capital Raising
If a Qualifying Shareholder does not take up any of its Open
Offer Entitlements, such Qualifying Shareholder's holding, as a
percentage of the Enlarged Share Capital, will be diluted by 32.4
per cent. as a result of the Capital Raising.
Subject to certain limited exceptions, shareholders in Excluded
Territories will not be able to participate in the Open Offer and
will therefore experience dilution as a result of the Capital
Raising.
Shareholders who are otherwise not Qualifying Shareholders will
not be able to participate in the Open Offer and will therefore
experience dilution as a result of the Capital Raising.
DIVID POLICY
As a result of the significant reductions to the Group's
revenues and, therefore, cash flows, during the Covid-19 pandemic,
coupled with restrictions in the Group's banking facilities, the
Company paused cash dividend payments in 2020. As a result of the
Proposed Transaction, restrictions to passing cash flow up to the
Company from its core Mall Facility will be removed. Therefore,
assuming rental income returns to a normalised basis, the Company
should be capable of distributing limited cash dividends to
Shareholders during the second half of the financial year ending 30
December 2022.
The Company will target a sustainable dividend pay-out ratio and
to distribute on a semi-annual basis (in approximate proportions of
45 / 55 and in that order in respect of each financial year) not
less than approximately 90 per cent. of the Company's EPRA
earnings, in line with the Company's requirements to distribute at
least 90 per cent. of its taxable profits under the REIT
regime.
RETENTION AWARDS AND AMMENTS TO THE LTIP
Background and rationale for the Proposed Long Term Retention
Awards
The retention of key individuals has been identified as a risk
factor (as set out at paragraph 2.8 in the section headed "Risk
Factors" on pages 11 to 22 of the prospectus). In order to mitigate
this risk factor and support the retention of the Chief Executive
Officer, Lawrence Hutchings, and the Group Finance Director, Stuart
Wetherly, it is therefore proposed that a cash Long term Retention
Award is provided
of GBP1,000,000 and GBP500,000 respectively. The Long Term
Retention Awards will be paid subject to each individual's
continuous employment until the award vests and becomes payable on
30 September 2023, subject to the terms below. It is the Board's
view that the retention and motivation of the Chief Executive
Office and the Group Finance Director is central to delivery of the
business strategy, including those actions arising from and enabled
by the proposals contained within the prospectus. The Board
believes that the Chief Executive Officer and the Group Finance
Director have demonstrated exceptional leadership throughout the
challenges presented by the global pandemic and the subsequent
shifts in the market and in consumer behaviours. The Board
therefore wishes to make the proposed Long Term Retention Awards
both in recognition of the efforts to date and also in order to
mitigate the risk set out in paragraph 2.8 of the section headed
"Risk Factors".
Rationale for amendment of the Directors' Remuneration
Policy
The Company's existing Directors' Remuneration Policy does not
currently allow for the proposed Retention Award to be made.
Payments to executive directors can only be made if they are within
the approved Directors' Remuneration Policy; an amendment to the
Directors' Remuneration Policy is therefore required.
Principal Terms of the Long Term Retention Awards for Executive
Directors
Participants Lawrence Hutchings (Chief Executive Officer); and
Stuart Wetherly (Group Finance Director)
Quantum Lawrence Hutchings: GBP1,000,000 to be paid in cash
Stuart
Wetherly: GBP500,000 to be paid in cash
Award date Immediately following approval at the General
Meeting
Payment date 30 September 2023
Performance conditions Continued employment and not subject to disciplinary or performance procedures at the payment date.
Leaver terms If, prior to the payment date, a participant ceases
to be employed by the Group, his Long Term Retention Award will
lapse with immediate effect. Where, however, a participant ceases
employment as a 'good leaver', any Long Term Retention Award held
by that individual will not lapse and may be retained to the extent
that the Remuneration Committee in its discretion determines taking
into account such factors as the Remuneration Committee in its
discretion determines including the period of time that the
participant was employed from the award date. Such retained Long
Term Retention Award will vest on the normal payment date (unless
the Remuneration Committee in its discretion determines that it
will be settled earlier) and in the normal manner subject to the
other conditions applying to the Long Term Retention Award being
met.
A participant will be a good leaver if their employment ceases:
a) due to death; b) due to injury, ill-health or disability (in
each case evidenced to the satisfaction of the Remuneration
Committee); c) due to redundancy or upon the transfer out of the
Group of a company or business by which the participant is
employed; d) in any other circumstance that the Remuneration
Committee determines (other than dishonesty, fraud, misconduct or
any other circumstance that justifies the summary dismissal of the
participant).
If, prior to the payment date, a participant has given or
received notice to terminate their employment with the Group, his
Long Term Retention Award will not be paid unless the Committee is
satisfied that the participant has performed satisfactorily and to
have met the
reasonable expectations of the role for which they are employed
during the period from the date of the award to the payment
date.
Change of Control In the event of a takeover or scheme of
arrangement of the Company (other than a takeover or scheme of
arrangement to give effect to an internal reorganisation) or
winding-up of the Company before the normal payment date of the
Long Term Retention Award, the award will vest early and in
full.
Malus and Clawback Clawback provisions will apply to the Long Term Retention Awards if it is discovered within two years of the payment of a Long Term Retention Award that:
l there has been a material misstatement
or miscalculation in the results of
the Company;
l the award holder has committed an act
of gross misconduct;
l the award holder has committed an act
which in the Remuneration Committee's
opinion has given or could give rise
to serious reputational damage to the
Group;
l the award holder has committed an act
which in the Remuneration Committee's
opinion deliberately misled the Board
or the market as to the performance
of the Group;
l the award holder has committed an act
which in the Remuneration Committee's
opinion has caused the Company or business
in which the award holder is employed
to suffer a material failure of risk
management; and/or
l the Company enters an involuntary
administration
or insolvency process or a company
voluntary
arrangement.
Malus provisions will apply to allow the Remuneration Committee
to reduce the payment under a Long Term Retention Award if any of
the circumstances set out above occur prior to the payment of the
Long Term Retention Award.
Other Terms Without the prior approval of the Company in general meeting:
l these arrangements will not be extended to any additional
participants; and
l the maximum entitlement for any one participant will not be
amended to the participant's advantage.
The Long Term Retention Awards are not pensionable.
Background and rationale for the Proposed Amendment to LTIP for
non-directors
As referred to above, the retention of key individuals has been
identified as a risk factor (as set out at paragraph 2.8 in the
section headed "Risk Factors" on pages 11 to 22 of the prospectus).
In order to mitigate this risk factor, in parallel with the awards
proposed to be made to executive directors, the Board plans to also
make Long Term Retention Awards to select members of senior
management. Similarly to the proposed executive director
arrangements, the planned awards reflect the importance of
retaining key staff over a critical period where the business seeks
to recover from the impact of Covid-19 and consolidate and grow
following the completion of the Capital Raising. These below-Board
awards will be made under the Company's LTIP as this helps align
the interests of recipients to shareholders and recognises that the
proposed recipients of these awards are not currently in receipt of
any "live" share awards as all awards previously granted under the
LTIP are either already available to exercise or are not expected
to qualify for vesting.
Proposed Amendment to LTIP for non-directors
To simplify the award structure and keep it closely aligned to
the aim of retention, in line with the proposed approach for the
two executive directors, these below-Board level awards will not be
subject to the achievement of performance conditions and will be
contingent only on remaining in continued employment within the
Group for an 18 month period. To facilitate this approach, the
Board is seeking shareholder approval to amend the rules of the
LTIP to reduce the minimum vesting term from three years to 18
months for employees below Board level. The Board's view is that
reducing this term and allowing flexibility for a one off award
without performance conditions will provide a stronger incentive
over a critical period for the business.
GENERAL MEETING
You will find set out at the end of the prospectus a Notice of
General Meeting convening a general meeting to be held on 1
November 2021 at 2.00 p.m. at 110 Rochester Row, Westminster,
London, SW1P 1JQ. The full text of the Notice of General Meeting is
set out in Part 12 of the prospectus.
At the General Meeting, the following Resolutions will be
proposed:
-- an ordinary resolution (requiring approval of more than 50
per cent. of the votes cast in person or by proxy in respect of the
resolution) to allot shares under section 551 of the Companies
Act;
-- an ordinary resolution (requiring approval of more than 50
per cent. of the votes cast in person or by proxy in respect of the
resolution) to approve the Long Term Retention Awards to the
executive directors of the Company and an amendment to the current
Directors' Remuneration Policy (that was approved by Shareholders
in 2019) authorising the Company to award such Long Term Retention
Awards to the executive directors of the Company; and
-- an ordinary resolution (requiring approval of more than 50
per cent. of the votes cast in person or by proxy in respect of the
resolution) to approve an amendment to the rules of the Capital
& Regional PLC 2018 Long Term Incentive Plan to reduce from
three years to 18 months the minimum vesting period of awards that
may be granted pursuant to the LTIP to non-director employees.
The Capital Raising will not proceed unless the Capital Raising
Resolution is passed by the requisite majority.
If the Capital Raising Resolution is not passed, the Company
would not benefit from the funds raised through the Capital
Raising. In such circumstances the Company will have the option to
proceed with the Mall Debt Restructuring, but to do so the Company
would need to utilise substantially all of its Central Cash. The
Board will therefore consider the circumstances at the time, should
this eventuality arise.
If the Board were to resolve not to proceed with the Mall Debt
Restructuring, the Group would need to enter into negotiations with
its lenders to extend the covenant waivers currently in place. The
Group had previously secured a number of covenant waivers for the
Mall Facility since July 2020. If the Proposed Transaction does not
go ahead then the Board would seek further covenant relaxations
from the lenders. In the case of the Exchange, Ilford the Group has
a waiver of all covenants until April 2022 and has agreed outline
terms on an agreement where further relaxation will be provided
until at least the end of 2022 in return for the Group providing
new funding to facilitate completion of major asset management
initiatives at the centre. If these further covenant relaxations
are not put in place and no alternative agreement is reached with
the lenders then the Group could face a potential need to partially
cure the loans with a cash contribution. In respect of the Four
Mall Assets and the Exchange, Ilford, the Central Cash balance
maintained by the Group at 30 June 2021, in addition to available
cash within the relevant structures, at that point in time,
provides sufficient funds to remedy the LTV covenants if values
fell by up to a further 10 per cent. across these assets by
reference to the June 2021 valuations.
If the Group did not choose to cure the loan breach then there
is a risk that ultimately the loan could be enforced and as such
the Group would no longer control the asset or consolidate the
income, costs, assets and liabilities in respect of the entity.
Accordingly, such actions would compromise the Group's competitive
position and growth prospects.
Accordingly, it is, therefore very important that Shareholders
vote in favour of the Capital Raising Resolution so that the
Capital Raising can be completed in full.
The results of the votes cast at the General Meeting will be
announced as soon as possible once known through an RIS and on the
SENS, and on the Company's website. It is expected that this will
be on 1 November 2021.
RECOMMATION
The Board considers the Proposed Transaction and the passing of
the Resolutions to be in the best interests of the Company and its
Shareholders as a whole.
Accordingly, the Board recommends unanimously that Shareholders
vote in favour of the Resolutions to be proposed at the General
Meeting, as the Directors (other than Louis Norval) have
irrevocably undertaken to do in respect of their own beneficial
holdings and those of persons connected to them , which together
amount to 180,150 Ordinary Shares, representing approximately 0.1
per cent. of the Ordinary Shares in issue as at the Latest
Practicable Date. Each of Lawrence Hutchings and Stuart Wetherly
have undertaken not to vote on the Long Term Retention Award
Resolution at the General Meeting. The Undertaking from Louis
Norval is to vote in favour of the Resolutions in respect of such
number of shares as he may hold at the General Meeting.
Shareholders should also be aware that if the Capital Raising
Resolution to be proposed at the General Meeting is not passed, the
Capital Raising will lapse and will not be completed. The Long Term
Retention Award Resolution and the LTIP Resolution are not
conditional on the Capital Raising being approved, and are both
independent and separate resolutions.
CAPITAL RAISING STATISTICS
Issue Price for each Open Offer Share 56 pence
Discount of Issue Price to the Closing 2.4 per cent.
Price as at the Latest Practicable Date
Number of Existing Ordinary Shares in
issue as at the Latest Practicable Date 111,819,626
Basis of Open Offer 23 Open Offer Shares
for every 48 Existing
Ordinary Shares
Number of Open Offer Shares to be issued
pursuant to the Open Offer 53,580,237
Number of Ordinary Shares in issue immediately
following completion of the Capital Raising
(*() 165,399,863
Open Offer Shares as a percentage of 32.4 per cent.
the Enlarged Share Capital of the Company
immediately following completion of the
Capital Raising (*()
Estimated expenses in connection with GBP2.6 million
the Capital Raising
Estimated net proceeds receivable by GBP27.4 million
the Company from the Capital Raising
(after deduction of fees and expenses)
ISIN of the Open Offer Shares GB00BL6XZ716
SEDOL of the Open Offer Shares BL6XZ71
ISIN of the Open Offer Entitlements GB00BP6S9729
SEDOL of the Open Offer Entitlements BP6S972
LSE code for the Ordinary Shares CAL
JSE code for the Ordinary Shares CRP
( Notes: *Assuming that no Ordinary Shares are issued between
the Latest Practicable Date and Admission becoming effective other
than pursuant to the Open Offer.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Record Date for Open Offer Entitlements close of business on 11
October
Announcement of the Capital Raising and Open Offer opens 7.00 a.m. on 14 October
Ex-Entitlements Time for the Open Offer 8.00 a.m. on 14
October
Record date to appear in the SA Register in close of business
order to receive the prospectus, the Supplementary on 8 October
Information Memorandum and Form of Proxy 14 October
Publication and posting of the prospectus, the
Supplementary Information Memorandum and Forms
of Proxy and Application Forms (to Qualifying
Non-CREST Shareholders only)
Publication of Notice of the Open Offer in the London Gazette 14
October
Open Offer Entitlements enabled in CREST and credited to stock as soon as practicable after
accounts in CREST (Qualifying CREST Shareholders only) 8.00 a.m.
on 15 October
Last date to trade to appear in the SA Register in order to
participate 19 October
and vote at the General Meeting
Record date to appear in the SA Register in order to participate
and 22 October
vote at the General Meeting
Recommended latest time for requesting withdrawal of 4.30 p.m.
on 25 October
Open Offer Entitlements from CREST
Latest time and date for depositing Open Offer Entitlements in CREST 3.00 p.m. on 26 October
Latest date and time for splitting Application Forms 3.00 p.m.
on 27 October
(to satisfy bona fide market claims only) pected Timetable 2021
Latest time and date for receipt of completed Application Forms
and 11.00 a.m. on 29 October
payments in full and settlement of CREST instructions (as
appropriate)
Announcement of the results of the Open Offer through a
Regulatory 1 November
Information Service and SENS
General Meeting 2.00 p.m. on 1 November
Announcement of the results of the General Meeting 1
November
UK Admission of and commencement of dealings 8.00 a.m. on or around 5 November
in Open Offer Shares
SA Admission of and commencement of dealings in 10.00 a.m. on or around 5 November
Open Offer Shares
Open Offer Shares issued and credited to CREST accounts on or
soon after 8.00 a.m. on 5 November
Where applicable, expected date for despatch of definitive share
By 19 November
certificates for Open Offer Shares in certificated form
Notes :
(1) The times set out in the expected timetable of principal
events above and mentioned throughout this announcement are times
in London unless otherwise stated, and may be adjusted by the
Company in consultation with or, if required, with the agreement of
Investec and Numis, in which event details of the new times and
dates will be notified to the FCA, the London Stock Exchange and,
where appropriate, Shareholders.
(2) These dates and times given are indicative only and are
based on the Company's current expectations and may be subject to
change (including as a result of changes to the regulatory
timetable). If any of the times and/or dates above change, the
revised times A12 5.1.9 and/ or dates will be notified to
Shareholders by announcement through a Regulatory Information
Service and SENS.
(3) If your Open Offer Entitlements are in CREST and you wish to
convert them to certificated form.
(4) If your Open Offer Entitlements are represented by an
Application Form and you wish to convert them to uncertificated
form.
If you have any queries on in relation to the prospectus or the
timetable please call the relevant Shareholder helpline as
follows:
Equiniti Shareholder Helpline for Shareholders registered on the
UK Register, on 0371 384 2050 or, if telephoning from outside the
UK, on +44 (0)371 384 2050 between 8.30 a.m. and 5.30 p.m. Monday
to Friday (except public holidays in England and Wales). Calls to
the Shareholder Helpline from outside the UK are charged at
applicable international rates. Different charges may apply to
calls made from mobile telephones and calls may be recorded and
monitored randomly for security and training purposes. Equiniti
cannot provide advice on the merits of the Capital Raising and/or
the Capital Raising nor give any financial, legal or tax
advice.
JSE Investor Services Helpline for Shareholders registered on
the SA Register, on 0861 472 644 if calling from within South
Africa (or +27 11 029 0112 for Shareholders registered on the SA
Register calling from outside South Africa) between 08:00 and 16:00
(South African time) from Monday to Friday, excluding public
holidays in South Africa. Calls made from within South Africa will
be charged at the standard geographic rate and will vary by
provider. Calls made from outside of South Africa will be charged
at the applicable international rates. Lines are open between 8.00
a.m. and 4.30 p.m. (South African standard time) Monday to Friday
(except South African public holidays).
APPIX
In this Announcement the following expressions have the meaning
ascribed to them unless the context otherwise requires:
Adjusted Profit is the total of Contribution from wholly-owned
assets, the profit from Snozone and property management fees less
central costs (including interest, excluding non-cash charges in
respect of share-based payments) after tax
Admission together, the UK Admission and SA Admission
Admission and Disclosure Standards the "Admission and Disclosure
Standards" of the London Stock Exchange containing among other
things, the admission requirements to be observed by companies
seeking admission to trading on the London Stock Exchange's main
market for listed securities.
Application Form the application form accompanying the
prospectus on which
Qualifying Non-CREST Shareholders may apply for Open Offer
Shares under the Open Offer
Articles the articles of association of the Company
Board the Directors of Capital & Regional
Business Day a day (other than a Saturday, Sunday or public
holiday) on which
banks are generally open for business in the City of London for
the transaction of normal banking business
Capital Raising the Open Offer
Capital Raising Resolutions the resolution numbered 1 to be
proposed at the General Meeting, as set out in the Notice of
General Meeting
CBRE CBRE Limited
Central Cash cash held centrally by the Group that is
unencumbered and over which the Group's lenders have no
security
certificated or in certificated form in relation to a share or
other security, a share or other security which is not in
uncertificated form
Closing Price the closing middle market quotation in Pounds
Sterling of an Existing Ordinary Share as derived from the Daily
Official List of the London Stock Exchange on a particular day
Code the US Internal Revenue Code of 1986, as amended
Companies Act the Companies Act 2006 as amended
Company or Capital & Regional Capital & Regional PLC, a
public limited company incorporated in England and Wales with
registered number 01399411
Contribution net rent less net interest, including unhedged
foreign exchange movements
Covid-19 the Coronavirus Disease 2019 as designated by the World
Health Organisation
CREST the relevant system, as defined in the CREST Regulations
(in respect of which Euroclear is the operator as defined in the
CREST Regulations)
CREST Manual the rules governing the operation of CREST,
consisting of the
CREST Reference Manual, CREST International Manual, CREST
Central Counterparty Service Manual, CREST Rules, CREST
Courier and Sorting Service Operations Manual and CREST Glossary
of Terms (all as defined in the CREST Glossary of Terms promulgated
by Euroclear on 15 July 1996 and as amended since)
CREST Member a person who has been admitted to Euroclear as a
system-member (as defined in the CREST Regulations)
CREST Participant a person who is, in relation to CREST, a
system-participant (as defined in the CREST Regulations)
CREST Regulations the Uncertificated Securities Regulations 2001
(SI 2001 No. 01/378), as amended
CREST Sponsor a CREST participant admitted to CREST as a CREST
sponsor (as defined in the CREST Regulations)
CREST Sponsored Member a CREST Member admitted to CREST as a sponsored member
CSDP a Central Securities Depositary Recipient accepted as a
participant under the South African Financial Markets Act, 2012,
appointed by a Shareholder in South Africa for the purposes of, and
in regard to, dematerialisation and to hold and administer
securities or an interest in securities on behalf of such
Shareholder
CTA 2010 the Corporation Tax Act 2010
CVA a company voluntary arrangement, a legally binding agreement
with a company's creditors to restructure its liabilities
Daily Official List the daily record setting out the prices of
all trades in shares and other securities conducted on the London
Stock Exchange
Dematerialised Shareholders Shareholders on the SA Register who
hold Dematerialised Shares
Dematerialised Shares Ordinary Shares which have been
incorporated into the Strate system, title to which is no longer
represented by physical documents of title;
Directors the executive directors and non-executive directors of
the Company, whose names appear on page 34 of the prospectus
Directors' Remuneration Policy the policy in respect of the
remuneration of the Directors as approved by Shareholders in
2019
Disclosure Guidance and the rules relating to the disclosure of
information made in accordance
Transparency Rules with section 73A(3) of FSMA
Discontinued Operations has the same meaning given to the term
"classification as discontinuing" as defined in the IFRS
EEA the European Economic Area
Enlarged Share Capital the Company's ordinary issued share
capital following completion of the Capital Raising
EPRA the European Public Real Estate Association index
Equiniti Equiniti Limited
ERISA the US Employee Retirement Income Security Act of 1974, as
amended
ERISA Entity any person that is: (i) an "employee benefit plan"
as defined in Section 3(3) of ERISA that is subject to Title I of
ERISA; (ii) a "plan" as defined in Section 4975 of the Code,
including an individual retirement account or other arrangement
that is subject to Section 4975 of the Code; or (iii) an entity
which is deemed to hold the assets of any of the foregoing types of
plans, accounts or arrangements that is subject to Title I of ERISA
or Section 4975 of the Code; or any governmental, church, non-U.S.
or other employee benefit plan that is subject to any federal,
state, local or non-U.S. law that is substantially similar to the
provisions of Title I of ERISA or Section 4975 of the Code whose
purchase, holding, and disposition of the Open Offer Shares could
constitute or result in a non-exempt violation of any such
substantially similar law
ERV estimated rental value which is the Group's external
valuers' opinion as to the open market rent which, on the date of
valuation, could reasonably be expected to be obtained on a new
letting or rent review of a unit or property
EU the European Union
EU Prospectus Regulation the EU Regulation (EU) 2017/1129 of the
European Parliament and of the Council of 14 June 2017 on the
prospectus to be published when securities are offered to the
public or admitted to trading on a regulated market
Euroclear Euroclear UK & Ireland Limited, the operator of
CREST
EUWA the European Union (Withdrawal) Act 2018
Ex-Entitlements Time the time at which the Existing Ordinary
Shares are marked ex-entitlement, being 8.00 a.m. on 14 October
2021
Exchange, Ilford the shopping centre owned by the Group as more
particularly described in section 3.1 of Part 2 of the
prospectus
Excluded Territories Australia, Canada, Japan, New Zealand, the
United States of America and any other jurisdiction where the
extension or availability of the Capital Raising (and any other
transaction contemplated thereby) would breach any applicable law
or regulation and "Excluded Territory" shall mean any of them
Existing Ordinary Shares the 111,819,626 Ordinary Shares in
issue as at the Latest Practicable Date
Financial Conduct Authority or FCA the Financial Conduct Authority of the United Kingdom
Form of Proxy the form of proxy for use at the General
Meeting
Four Mall Assets the Mall Blackburn, the Mall Maidstone, the
Mall Wood Green and the Mall Walthamstow
FSMA the Financial Services and Markets Act 2000, as amended
GDP gross domestic product
General Meeting the general meeting of Capital & Regional to
be held at 2.00 p.m. on 1 November 2021 notice of which is set out
in Part 12 of the prospectus
Group the Company and each of its subsidiaries and subsidiary
undertakings from time to time
Growthpoint Growthpoint Properties Limited and/or any
Growthpoint Nominee (as the case may be)
Growthpoint Nominee or Nominee any one or more wholly-owned
subsidiaries of Growthpoint Properties Limited or partnerships in
which Growthpoint Properties Limited holds (directly or indirectly)
all or substantially all of the economic rights, together with any
person (including a general partner) who holds Capital &
Regional PLC Shares on behalf of any such person or partnership
HMRC HM Revenue & Customs
Homestead Homestead Group Holdings Limited
Homestead Relationship Agreement the relationship agreement dated 17 October 2019 between the
Company and Homestead as further described in paragraph 9.7 of
Part 9 of the prospectus
IFRS International Financial Reporting Standards as issued by
the International Accounting Standards Board and, for the purposes
of the prospectus, as adopted by the European Union
Interim Results the interim unaudited financial statements for
the period beginning 31 December 2020 and ended on 30 June 2021
Investec Investec Bank plc and/or Investec Bank Limited, as the
context requires;
Investment Assets the Four Mall Assets together with the
Exchange, Ilford, as more particularly described in section 3.1 of
Part 2 of the prospectus
Investment Assets and the Investment Assets together with any
cash held centrally by the
Central Operations Group including within its Snozone entities
IPD interest payment date
ISIN International Securities Identification Number
Issue Price 56 pence per Open Offer Share
JSE the exchange operated by JSE Limited (registration number 2005/022939/06), licensed as an exchange under the South African Financial Markets Act, 2012, as amended, and a public company incorporated in terms of the laws of South Africa
JSE Sponsor Investec Bank Limited, in its capacity as South
African sponsor to the Company;
Kingfisher Redditch Joint Venture as defined in paragraph 3.3 of Part 2 of the prospectus
Knight Frank Knight Frank LLP
Latest Practicable Date the latest practicable date prior to the
publication of the proepsctus, being 13 October 2021
LIBOR London inter bank offered rate
Listing Rules the Listing Rules made by the FCA under Part VI of
FSMA
LN Group Homestead, PDI Investment Holdings Limited, Mstead
Limited and any subsidiary of Homestead
London Gazette the daily publication issued in London with such
name
London Stock Exchange London Stock Exchange PLC
Long Term Retention Award the award of GBP1,000,000 to Lawrence
Hutchings (Chief Executive
Officer) and the award of GBP500,000 to Stuart Wetherly (Group
Finance Director)
Long Term Retention the memorandum setting out the particulars
of the Long Term
Award Memorandum Retention Awards and the ways in which these
are inconsistent with the approved Directors' Remuneration
Policy
Long Term Retention the ordinary resolution to be proposed as
Resolution numbered 2 at
Award Resolution the General Meeting to approve an amendment to
the Directors'
Remuneration Policy
LTIP Capital & Regional PLC 2018 Long-Term Incentive
Plan
LTIP Resolution the ordinary resolution to be proposed as
Resolution numbered 3 at the General Meeting to approve an
amendment to the LTIP
LTV loan-to-value
Main Board the Main Board of the list of securities admitted to
listing on the JSE Main Market the London Stock Exchange's main
market for listed securities
Mall Asset Facility Amendment the agreement dated 14 October
2021 between certain members of and Restatement Agreement the Group
and TIAA, a summary of which is set out in paragraph 9.3 of Part 9
of the prospectus document
Mall Blackburn the shopping centre owned by the Group as more
particularly described in paragraph 3.1 of Part 2 of the
prospectus
Mall Debt Restructuring the proposed restructuring of the debt
facility in respect of the Four Mall Assets as described in further
detail in section 2 of Part 1 of the prospectus and paragraph 9.3
of Part 9 of the prospectus
Mall Facility or Mall Asset the GBP265 million debt facility
secured over the Four Mall Assets as
Facility Agreement described in more detail in paragraph 9.12 of
Part 9 of the prospectus
Mall LP the Mall LP, being a limited partnership which is wholly
owned by the Group
Mall Luton the shopping centre owned by the Group as more
particularly described in paragraph 3.1 of Part 2 of the
prospectus
Mall Maidstone the shopping centre owned by the Group as more
particularly described in paragraph 3.1 of Part 2 of the
prospectus
Mall Walthamstow the shopping centre owned by the Group as more
particularly described in paragraph 3.1 of Part 2 of the
prospectus
Mall Wood Green the shopping centre owned by the Group as more
particularly described in paragraph 3.1 of Part 2 of the
prospectus
Market Abuse Regulation or MAR the Market Abuse Regulation (EU)
No. 596/2014 as it forms part of UK domestic law by virtue of the
EUWA
Marlowes Hemel Hempstead the shopping centre owned by the Group
as more particularly described in paragraph 3.1 of Part 2 of the
prospectus
Member State a sovereign state which is a member of the European
Union
Money Laundering Regulations the Money Laundering Regulations 2007 (S.I. 2007/2157)
Mstead Mstead Limited, a company associated with Louis
Norval
NatWest National Westminster Bank plc
Net Asset Value or NAV the net asset value
Net Rental Income or NRI the Group's share of the rental income,
less property and management costs (excluding performance fees) of
the Group
NIY net initial yield
Non-PID Dividend any dividend of the Company other than a PID
Notice of General Meeting the notice of the General Meeting
contained in Part 12 of the prospectus
Official List the Official List of the Financial Conduct
Authority pursuant to
Part VI of FSMA
Open Offer the conditional invitation to Qualifying Shareholders
to subscribe for the Open Offer Shares at the Issue Price on the
terms and subject to the conditions set out in the prospectus and,
in the case of Qualifying Non-CREST Shareholders only, the
Application Form
Open Offer Entitlements the pro rata entitlements of Qualifying
Shareholders to subscribe for 23 Open Offer Shares for every 48
Existing Ordinary Shares registered in their name as at the Record
Date, on and subject to the terms of the Open Offer
Open Offer Shares the 53,580,237 new Ordinary Shares to be
offered to Qualifying
Shareholders pursuant to the Open Offer
Ordinary Shares or Shares ordinary shares of GBP0.10 each in the
share capital of the Company
Overseas Shareholders Shareholders with registered addresses
outside the United Kingdom
and South Africa or who are citizens or residents of countries
outside the United Kingdom and South Africa
Panel The Panel on Takeovers and Mergers
Participant ID the identification code or membership number used
in CREST to
identify a particular CREST Member or other CREST
Participant
PID property income distribution
Pounds Sterling , Sterling or GBP the lawful currency of the United Kingdom
PR Regulation the UK version of Regulation (EU) 2019/980 of the
European Commission, which is part of UK law by virtue of EUWA
Property Valuation Reports the property valuation reports
prepared by the Property Valuers and set out in Part 6 of the
prospectus
Property Valuers CBRE and Knight Frank
Proposed Transaction the Capital Raising and Mall Debt Restructuring
Prospectus Regulation the UK version of Regulation (EU)
2017/1129 of the European Parliament and of the Council of 14 June
2017 on the prospectus to be published when securities are offered
to the public or admitted to trading on a regulated market, and
repealing Directive 2003/71/EC which is part of UK law by virtue of
the EUWA
Prospectus Regulation Rules the Prospectus Regulation Rules
published by the FCA under
Section 73A of FSMA in accordance with the Prospectus
Regulation
Qualifying CREST Shareholders Qualifying Shareholders holding
Ordinary Shares on the UK Register in uncertificated form on the
Record Date
Qualifying Non-CREST Shareholders Qualifying Shareholders
holding Ordinary Shares in certificated form on the Record Date
Qualifying Shareholders holders of Ordinary Shares who are
entered on the UK Register and/or the SA Register on or before the
Record Date and remain on such register at the Record Date with the
exclusion of Overseas Shareholders with a registered address or
resident in any Excluded Territory
Rand the lawful currency of South Africa
RBS The Royal Bank of Scotland plc
Record Date 6.00 p.m. on 11 October 2021
Registrars or Receiving Agent Equiniti and/or SA Transfer
Secretaries, as the case may be;
Regulation S Regulation S under the US Securities Act
Regulatory Information one of the regulatory information
services authorised by the
Service or RIS Financial Conduct Authority to receive, process
and disseminate
regulatory information in respect of listed companies
REIT Real Estate Investment Trust
Remuneration Committee the remuneration committee of the Company
Resolutions the Capital Raising Resolution, the LTIP Resolution
and the Long Term Retention Award Resolution
RICS Standards the Royal Institution of Chartered Surveyors
(RICS) Valuation - Profession Standards UK 2014 (revised January
2020)
RPI retail price index
SA Admission the admission of the Open Offer Shares to listing
and trading on the Main Board;
SA Register the share register maintained on behalf of the
Company by JSE Investor Services
SA Transfer Secretaries JSE Investor Services (Pty) Limited or
JSE Investor Services
SDRT stamp duty reserve tax
SENS the Stock Exchange News Service of the JSE
Shareholder a holder of Ordinary Shares from time to time
SONIA the SONIA (sterling overnight index average) reference
rate administered by the Bank of England (or any other person which
takes over the administration of that rate) and if that rate is
less than zero, SONIA shall be deemed to be zero
Sponsor Investec, acting in its capacity as sponsor to the
Company pursuant to Chapter 8 of the Listing Rules
Sponsor and Open Offer Agreement the sponsor and open offer
agreement between the Company, Investec and Numis, as further
described in paragraph 9.1 of Part 9 of the prospectus
SPV special purpose vehicle
stock account an account within a member account in CREST to
which a holding of a particular share or other security in CREST is
credited
Strate Strate Proprietary Limited (registration number
1198/0222242/07), a private company incorporated with the laws of
South Africa and the electronic clearing and settlement system used
by the JSE to settle trades
Supplementary Information the supplementary information
memorandum sent with this
Memorandum document to Qualifying Shareholders on the SA Register
Takeover Code the City Code on Takeovers and Mergers
TIAA Teachers Insurance and Annuity Association of America
UK Admission the admission of the Open Offer Shares (i) to the
premium listing
segment of the Official List and (ii) to trading on the London
Stock Exchange's main market for listed securities
UK Register the share register maintained on behalf of the
Company by Equiniti
UK REIT a real estate investment trust established in the United
Kingdom to which Part 12 of the CTA 2010 applies
uncertificated or in recorded on the relevant register of the
share or security concerned as
uncertificated form being held in uncertificated form in CREST
and title to which, by virtue of the CREST Regulations, may be
transferred by means of CREST
Underwriting Agreement the underwriting agreement between the
Company and Growthpoint, as further described in paragraph 9.2 of
Part 9 of the prospectus
United Kingdom or UK the United Kingdom of Great Britain and
Northern Ireland
US or United States the United States of America, its
territories and possessions, any state of the United States and the
District of Columbia
US Person a "U.S. person" as defined in Regulation S
US Securities Act the United States Securities Act of 1933, as
amended
Valid Applications means a duly completed Application Form and
payment in full for Open Offer Shares received by the Company which
complies in all respects with the terms of the Open Offer and with
the terms set out in the Application Form
VAT value added tax
[1] Source: GlobalData Jan 2021
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October 14, 2021 02:05 ET (06:05 GMT)
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