| THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF IRELAND, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF LOCAL SECURITIES LAWS OR REGULATIONS.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO SELL OR ISSUE, OR ANY SOLICITATION OF ANY OFFER TO PURCHASE OR SUBSCRIBE FOR, ANY NEW ORDINARY SHARES, NOR SHALL IT (OR ANY PART OF IT), OR THE FACT OF ITS DISTRIBUTION, FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH, OR ACT AS ANY INDUCEMENT TO ENTER INTO, ANY CONTRACT OR COMMITMENT WHATSOEVER WITH RESPECT TO THE PROPOSED PLACING. Proposed Placing of 8,000,000 New Ordinary Shares at 375 pence per share to raise £30 million and Notice of General Meeting In addition, the Company announces that new bank facilities of up to £135 million have been agreed with Lloyds Bank plc, The Royal Bank of Scotland plc, HSBC Bank plc and Barclays Bank plc. The Net Proceeds of approximately £28.7 million are intended to be used to part fund the first phase of development of the Pinewood Studios Development Framework (“PSDF”) in combination with the New Debt Facilities. In the short term, the Net Proceeds will be used to repay part of the existing debt facilities in order to manage the Group’s capital efficiently and to reduce interest costs. This will then provide headroom in the New Debt Facilities to enable the draw down of funds, as required, for phase one of the PSDF. At the same time as the placing of the 8,000,000 New Ordinary Shares, 8,266,667 Existing Ordinary Shares will be placed on behalf of a small number of existing Shareholders, with institutional and other investors at a price of 375 pence per share. The Placing is conditional, inter alia, on the passing of the Resolutions by Shareholders at the General Meeting, notice of which is set out on page 22 of the circular to Shareholders (“Circular”). If the Resolutions are passed, the Placing Shares will be allotted or sold immediately after the General Meeting and Admission of the New Ordinary Shares is expected to occur at 8.00 a.m. on 17 April 2015. The Placing is not underwritten. The Circular, extracts of which are set out below, is expected to be posted today, and will provide details of, and the background to, the Placing, and set out the reasons why the Board believes that the Placing is in the best interests of the Company and its Shareholders and to seek Shareholder approval of the Resolutions at the forthcoming General Meeting, which will be held at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL at 10.30 a.m. on 16 April 2015. Copies of the Circular will be available shortly on the Company’s website (www.pinewoodgroup.com) and will be available, free of charge, at the Company’s registered office at Pinewood Studios, Pinewood Road, Iver Heath, Buckinghamshire SL0 0NH during normal business hours on any weekday (public holidays excepted) up to and including 16 April 2015. Unless otherwise defined in this announcement, all defined terms used in this announcement shall have the meaning ascribed to them in the Circular. Ivan Dunleavy, Chief Executive Officer, commented: “Today’s announcement represents another significant step forward in the ongoing development of the Company and the implementation of PSDF to the benefit of shareholders as a whole and the UK creative industries. The Board is encouraged by the visibility of the level of forward bookings for the next financial year.” For the full RNS announcement see below or please click here. This announcement is published, subject to certain restrictions relating to persons resident in restricted jurisdictions, on Pinewood’s website at www.pinewoodgroup.com. For the avoidance of doubt, neither the content of the Company’s website nor the content of any website accessible from hyperlinks on the Company’s website (or any other website) is incorporated into, or forms part of, this announcement nor, unless previously published by means of a recognised information service, should such content be relied upon in reaching a decision as to whether or not to acquire, continue to hold, or dispose of securities in the Company. This announcement is not an invitation nor is it intended to be an inducement to engage in investment activity for the purpose of section 21 of FSMA. The Placing Shares are in any event being placed only with (i) persons who have professional experience in matters relating to investments and who are investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 of the United Kingdom (the “Financial Promotion Order”) or (ii) persons who fall within Article 49(2)(a) to (d) (“high net worth companies, unincorporated associations etc.”) of the Financial Promotion Order (all such persons together being referred to as “relevant persons”). Any investment or investment activity to which this announcement relates is available only to relevant persons and will be engaged in only with relevant persons. Anyone other than a relevant person must not rely on this announcement. Nplus1 Singer Advisory LLP (“N+1 Singer”) is acting as Nominated Adviser and broker to the Company in relation to the Placing. N+1 Singer, which is a member of the London Stock Exchange and is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting for the Company and for no one else in relation to the Placing. N+1 Singer will not be responsible to any other person for providing the protections afforded to its clients nor for advising any other person in connection with the matters contained in this announcement. This announcement has been issued by, and is the sole responsibility of, the Company. N+1 Singer has not authorised the contents of any part of this announcement and no representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by N+1 Singer, or by any of its respective affiliates or agents, as to or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to any interested party, and any liability therefore is expressly disclaimed. All statements in this announcement other than statements of historical fact are, or may be deemed to be, “forward-looking statements”. In some cases, these forward-looking statements may be identified by the use of forward-looking terminology, including the terms “targets”, “believes”, “estimates”, “anticipates”, “expects”, “intends”, “may”, “will” or “should” or, in each case, their negative or other variations or comparable terminology. They appear in a number of places throughout the announcement and include statements regarding the intentions, beliefs or current expectations of the Company and/or Directors concerning, among other things, the trading performance, results of operations, financial condition, liquidity, prospects and dividend policy of the Company. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. The Company’s actual performance, result of operations, financial condition, liquidity and dividend policy may differ materially from the impression created by the forward-looking statements contained in this announcement. In addition, even if the performance, results of statements contained in this announcement, those results or developments may not be indicative of results or developments in subsequent periods. Important factors that may cause these differences include, but are not limited to, changes in economic conditions generally; changes in interest rates and currency fluctuations; impairments in the value of the Company’s assets; legislative/regulatory changes; changes in taxation regimes; the availability and cost of capital for future expenditure; the availability of suitable financing; the ability of the Group to retain and attract suitably experienced personnel and competition within the industry. Prospective investors should specifically consider the factors identified in this announcement which could cause actual results to differ before making an investment decision. This Announcement or any part of it does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States (including its territories and possessions, any state of the United States and the District of Columbia). The Placing Shares have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”) or with any securities regulatory authority of any state or jurisdiction of the United States, and may not be offered, sold or transferred, directly or indirectly, in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. There will be no public offering of securities in the United States. Enquiries Pinewood Group plc +44 (0) 1753 656 732 Ivan Dunleavy, Chief Executive Officer Chris Naisby, Finance Director Andrew M. Smith, Director of Strategy and Communications N+1 Singer (Nominated Adviser and Broker) +44 (0)207 496 3000 Richard Lindley Shaun Dobson Extracts from the Circular EXPECTED TIMETABLE OF PRINCIPAL EVENTS Latest time and date for receipt of Forms of Proxy 10.30 a.m. on 14 April 2015 General Meeting 10.30 a.m. on 16 April 2015 Admission and commencement of dealings in the New Ordinary Shares on AIM 8.00 a.m. on 17 April 2015 CREST accounts credited with the Placing Shares in uncertificated form 17 April 2015 Despatch of share certificates in respect of the Placing Shares to be issued in certificated form 24 April 2015 Notes: 1. Each of the times and dates above are indicative only and are subject to change. If any of the above times and/or dates change, the revised times and/or dates will be notified by the Company to Shareholders by announcement through a regulatory information service. 2. All of the above times refer to London times unless otherwise stated. Admission and the commencement of dealings in the New Ordinary Shares on AIM are conditional on, inter alia, the passing of the Resolutions at the General Meeting. 1. Introduction The Company announced on 31 March 2015 that it is proposing to raise £30 million (before fees and expenses) through a placing by N+1 Singer of 8,000,000 New Ordinary Shares at a price of 375 pence per share. The Placing Price represents an 11.8 per cent. discount to the Closing Price of 425 pence per Ordinary Share on 30 March 2015 (being the latest practicable date prior to the announcement of the Placing). The Placing is conditional, inter alia, on the passing by the Shareholders of the Resolutions at the General Meeting, including a special resolution which will give the Directors the required authority to disapply statutory pre-emption rights in respect of the allotment of the New Ordinary Shares. Subject to all relevant conditions being satisfied (or, if applicable, waived), it is expected that the New Ordinary Shares will be admitted to trading on AIM on or around 17 April 2015. The Net Proceeds are intended to be used to part fund the first phase of development of the Pinewood Studios Development Framework (“PSDF”). The PSDF will include new stages which are largely interchangeable for film, television, video games and associated services and the Board believes that the PSDF will deliver significant benefit for the Group by an expansion of its facilities and an increase in capacity. Phase 1 of the PSDF will be funded through the Placing and the proposed New Debt Facilities. Further details on the PSDF and the New Debt Facilities are set out below. The purpose of the Circular is to outline the reasons for, and provide further information on, the proposed placing of New Ordinary Shares and why the Board believes it to be in the best interests of the Company and Shareholders as a whole. The Board believes that raising equity finance with the flexibility provided by a non pre-emptive placing is the most appropriate method for the Company at this time. The Board aims to build a more diversified shareholder base that is able to support the Company through subsequent phases of growth and it is the Board’s belief that this requires support from new institutional investors. The Board believes that the potential long term value creation for the benefit of Shareholders arising from the application of the Net Proceeds outweighs the dilutive effects of the Placing. Notice of the General Meeting is set out at the end of the Circular. The Resolutions will be proposed at the General Meeting to approve the issue of the New Ordinary Shares pursuant to the Placing. The General Meeting has been convened for 10.30 a.m. on 16 April 2015 and will take place at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL. 2. Background to and Reasons for the Placing Drivers of Growth As summarised below, there is increasing global demand for studio facilities from the film, television and video games industries which is benefitting, and the Directors believe will continue to benefit, the Group. These industries are forecast to grow at a compound annual growth rate of approximately 6 per cent. between 2011 and 2016 and such growth is being driven by (i) global consumer demand and spending; and (ii) economic benefits which have increased competition to attract large, internationally mobile film and high-end television production and post-production activity. In addition, there is an ongoing shift towards digital film technology and the demands of major film production companies for studios with larger stages, backlot space and greater levels of inherent connectivity and security. Film Global consumer demand for film is growing, driven by greater accessibility and quality of content Television viewing is rising globally, driven by new delivery services such as Netflix and Amazon and the trend towards high-end television productions, like Da Vinci’s Demons, Game of Thrones and House of Cards, to capture mass audiences There is high consumer demand for video games with cinematic quality content in the UK Pinewood is a leading provider of studio and related services to the global screen based industries. However, the studios are now operating at close to full capacity, whilst there is an increasing demand for studio facilities globally, as described above. The PSDF is intended to address the Group’s capacity constraints by ultimately doubling the existing capacity of Pinewood Studios through the addition of a total of approximately 100,000m2 of new facilities, comprising stages, workshops and production offices. It is intended that the PSDF will be developed over three phases, each being up to five years in length, with the development of phase 1 expected to commence in the first half of 2015 and scheduled for completion in the first quarter of 2016. The total cost of the PSDF is estimated at £200 million, with phases 2 and 3 subject to demand requirements over time. The first phase of the PSDF will comprise five new large stages (totalling 15,820m2), which will increase the overall studio production space at Pinewood Studios by approximately 50 per cent., ten workshops (totalling 13,274m2), two production offices (totalling 6,770m2) and associated infrastructure and landscaping (totalling 120m2). The phase 1 works will also include the new infrastructure required for the PSDF. Completion of the first phase will significantly expand Pinewood’s overall capacity to accommodate major feature films, television programmes, commercials and other screen-based productions. The Directors believe it will also enhance Pinewood’s position as a leading facility for the global screen-based industries. The cost of construction of phase 1 of the PSDF is anticipated to be approximately £65 million, which is to be funded by the Net Proceeds and the New Debt Facilities. Planning permission for the PSDF was granted by the Secretary of State on 18 June 2014. This supersedes the Masterplan Consent granted in 2006 for the development of Pinewood Studios, as it is currently configured, and includes consent for minor reconfiguration of certain of Pinewood’s existing facilities, as well as the development of the PSDF site. The planning permission was subject to planning conditions and the requisite Reserved Matters Approval of phase 1 of the PSDF was granted on 23 December 2014. 3. New Debt Facilities The Company has agreed new banking facilities of up to £135 million with Lloyds Bank plc, The Royal Bank of Scotland plc, HSBC Bank plc and Barclays Bank PLC, comprising: a £100 million term loan facility committed to 29 May 2019, £45 million of which will be utilised to refinance the Company’s existing committed debt facilities and the remaining £55 million (the “Development Tranche”) will be available to draw down prior to 30 September 2016 to fund phase 1 of the PSDF, with repayments commencing in June 2017; and 4. Use of Proceeds The Net Proceeds of approximately £28.7 million will be used to part fund the implementation of phase 1 of the PSDF in combination with the New Debt Facilities. In the short term, the Net Proceeds will be used to repay part of the existing debt facilities in order to manage the Group’s capital efficiently and to reduce interest costs. This will then provide headroom in the New Debt Facilities to enable the draw down of funds, as required, for phase 1 of the PSDF. 5. Proposed Admission to the Premium Segment of the Official List and the Main Market It is the Board’s current intention to apply in due course for the admission of the Ordinary Shares to the premium segment of the Official List of the UK Listing Authority and to trading on the Main Market. Any application will be subject to review and approval by the FCA, including the satisfaction of the UKLA’s eligibility criteria. The Peel Group has confirmed to the Company and N+1 Singer that it is supportive of the proposed move by the Company to the Main Market and will seek to assist the Company with that move in due course. Cancellation of the admission of the Ordinary Shares to trading on AIM would be effected as part of the process. Shareholders will be kept fully informed of the Board’s future intentions in this regard. The Board intends to seek a waiver from the London Stock Exchange from the requirement under AIM Rule 41 to obtain Shareholder consent for the Cancellation. A request for such a waiver would be on the basis that Shareholders would still have the ability to trade the Ordinary Shares on a recognised investment exchange following the Cancellation. The Company would still be required to give at least 20 Business Days’ notice of the Cancellation. 6. Current Trading and Outlook n the interim results for the six months ended 30 September 2014, published on 25 November 2014, the Company reported that it had made positive progress since the interim period end and this has continued to date. As a result, the Directors believe that the financial performance for the year to 31 March 2015 will be in line with expectations. Once again, film revenues and associated activities have performed strongly. During the financial year to 31 March 2015, the Company has seen high levels of stage utilisation and hosted a number of major feature films such as ‘Star Wars: Episode VII The Force Awakens’; ‘Alice in Wonderland: Through the Looking Glass’; ‘The Huntsman’; ‘Avengers: Age of Ultron’ and the start of the 24th Bond film, ‘Spectre’. As reported at the time of the interim results, television revenues were markedly lower than in the same period in the previous financial year. As expected, during the second half of the year television revenues have performed more strongly, with new productions such as ‘Weekend Kitchen’, ‘Birds of a Feather’ and ‘I live with Models’ and returning shows such as ‘Would I Lie To You?’ and the National Lottery utilising the Group’s facilities. Elsewhere in the Media Services segment, Digital Content Services have performed well. Progress has been made with the Group’s international strategy, which is making meaningful contributions to revenue, including now from China. Demand for the Company’s Media Hub offering remains high, with occupancy at approximately 98 per cent. Pinewood Studio Wales began operations in January 2015 and is currently hosting the pilot of a high-end television production, ‘The Bastard Executioner’. During the course of the financial year, the Company invested in, and advised on, investment in two film productions, ‘Take Down’ and ‘Genius’. ‘Take Down’ was a co-production between the Governments of Wales and the Isle of Man and used extensive locations in both territories. In December 2014, Pinewood achieved the significant strategic objective of regaining full ownership of the Shepperton Studios Property Partnership through the acquisition of the 50 per cent. interest owned by clients of Aviva Investors for a total cash payment of £36.8 million. This amount included full repayment of £24.0 million of drawn debt and the cancellation of the SSPP facility provided by Aviva. The Board is encouraged by the visibility of the level of forward bookings for the financial year to 31 March 2016. 7. Board Changes On Admission, it is intended that Neil Lees and Tom Allison, both non-executive Directors and representatives of the Company’s largest shareholder, the Peel Group, will resign from the Board. Steven Underwood will remain as the sole board representative of the Peel Group. The Board intends to appoint at least one additional independent non-executive director in due course. 8. Related Party Transaction Warren James is a related party of the Company, as defined by the AIM Rules, as it has an existing shareholding in the Company of 26.7 per cent. and so is a ‘Substantial Shareholder’ for the purposes of the AIM Rules. It is proposed that Warren James will participate in the Placing and subscribe for 1,797,842 New Ordinary Shares at the Placing Price, and such participation will be classified as a Related Party Transaction pursuant to the AIM Rules. The Directors, having consulted with N+1 Singer as the Company’s nominated adviser, consider that the terms of this Related Party Transaction are fair and reasonable insofar as the Shareholders are concerned. 9. Information on the Placing (a) Placing of New Ordinary Shares The Company is proposing to raise £30 million (before expenses) by way of a Placing of 8,000,000 New Ordinary Shares at the Placing Price. The New Ordinary Shares will represent approximately 13.9 per cent. of the Enlarged Share Capital. The Placing Price represents a discount of 11.8 per cent. to the Closing Price of 425 pence per Ordinary Share on 30 March 2015 (being the latest practicable date prior to the announcement of the Placing). (b) Selling Shareholders In addition to the Placing of New Ordinary Shares, the Peel Group (through its subsidiary Peel Holdings) and the Isle of Man Treasury have agreed to sell 6,239,840 and 2,026,827 Existing Ordinary Shares, respectively, at the Placing Price, being in aggregate approximately 16.7 per cent. of the issued Existing Ordinary Shares. Immediately following Admission, the Enlarged Share Capital of the Company will be held as follows: Peel Holdings 39.09% Warren James 26.10% Isle of Man Treasury 4.99% Directors 0.54% Other 29.28% Total 100.0% (c) Directors’ participation in the Placing It is intended that certain of the Directors will subscribe for New Ordinary Shares in the Placing at the Placing Price and details are set out below: Director Number of Existing Ordinary Shares held Number of Placing Shares being acquired Total number of Ordinary Shares held following the Placing Percentage of Enlarged Share Capital Lord Grade of Yarmouth, CBE 17,500 – 17,500 0.03% Ivan Patrick Dunleavy – 127,884 127,884 0.22% Christopher John Naisby – 19,376 19,376 0.03% Andrew Mark Smith – 19,376 19,376 0.03% Nicholas David James Smith – 89,131 89,131 0.16% James Stephen Christian 10,000 19,376 29,376 0.05% Neil Lees – – – – Thomas Eardley Allison 8,000 – 8,000 0.01% Steven Underwood – – – – Ruth Catherine Prior – – – – (d) The Placing Pursuant to the Placing, both the 8,000,000 New Ordinary Shares and the 8,266,667 Sale Shares have been conditionally placed with new and existing investors at the Placing Price. In connection with the Placing, the Company and the Selling Shareholders have entered into the Placing Agreements pursuant to which N+1 Singer has agreed, in accordance with its terms, to use reasonable endeavours to place the Placing Shares with certain institutional and other investors. The Placing is conditional, inter alia, on: the passing of the Resolutions; The New Ordinary Shares will be issued credited as fully paid and will rank in full for all dividends and other distributions declared, made or paid after the admission of the New Ordinary Shares, respectively and will otherwise be identical to and rank on Admission pari passu in all respects with the Existing Ordinary Shares. The Placing Shares are not being made available to the public and are not being offered or sold in any jurisdiction where it would be unlawful to do so. 10. General Meeting Set out on page 22 of the Circular is a notice convening the General Meeting of the Company to be held at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL at 10.30 a.m. on 16 April 2015, at which the Resolutions summarised below will be proposed: an ordinary resolution to grant authority to the Directors to allot the New Ordinary Shares, representing approximately 16.2 per cent. of the Existing Ordinary Shares; and 11. Irrevocable undertakings Each of Peel Holdings, Warren James and the Isle of Man Treasury has given an irrevocable undertaking to vote in favour of the Resolutions in respect of its own legal and/or beneficial holding of Existing Ordinary Shares which, in aggregate, total 46,760,966 Existing Ordinary Shares, representing in aggregate 94.6 per cent. of the Existing Ordinary Shares. 12. Shareholder agreements The Company, N+1 Singer, Peel Holdings (IOM) and Peel Holdings Land and Property Group Limited (both of which companies are members of the Peel Group) have entered into the Peel Relationship Agreement and the Company, N+1 Singer and Warren James have entered into the Warren James Relationship Agreement, both of which are conditional on Admission. The previous undertakings given by Peel Holdings Land and Property Group Limited and Warren James to the Company and N+1 Singer in 2012, which contain similar provisions to those in the Peel Relationship Agreement and the Warren James Relationship Agreement, will terminate on Admission. (a) Peel Relationship Agreement The Peel Relationship Agreement regulates certain aspects of the continuing relationship between the Group and the Peel Group to ensure that the Group is capable at all times of carrying on its business independently of the Peel Group and that any future transactions between the Group and the Peel Group are on an arm’s length basis. The Peel Relationship Agreement also provides that there should always be a majority of directors on the Board, and on any committee of the Board, who are independent of the Company’s shareholders. The Peel Relationship Agreement provides that the Peel Group will not acquire Ordinary Shares for one year from Admission, irrespective of whether the Peel Relationship Agreement terminates prior to that date. This restriction is subject to certain exceptions, including for acquisitions made pursuant to a general offer or scheme of arrangement or to maintain an aggregate holding of approximately 39.1 per cent. of the Company’s issued share capital or at any time with N+1 Singer’s consent. The Company has undertaken to the Peel Group that (i) it will not without the consent of Peel Holdings (IOM) create a new class of security, alter the rights attaching to the Ordinary Shares, grant any options to subscribe for new Ordinary Shares or allot or issue any shares for non-cash consideration; and (ii) it will enforce the terms of the Warren James Relationship Agreement. The Peel Relationship Agreement terminates on the date upon w |
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Pinewood Group Plc Proposed Placing
