THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents of this document or the action you should take, you are recommended to seek your own financial advice immediately from an appropriately authorised stockbroker, bank manager, solicitor or other independent financial adviser who, if you are taking advice in the United Kingdom, is duly authorised under the Financial Services and Markets Act 2000 ("FSMA") or, if you are taking advice in Australia, holds an Australian Finance Services Licence.
The information in this Prospectus is not financial product advice or general investment advice for the purposes of the Corporations Act 2001 of the Commonwealth of Australia (the "Corporations Act") and has been prepared without taking into account your particular investment objectives, financial circumstances or needs. You should read the whole of this Prospectus and carefully consider the risk factors (including without limitation those set out in the Risk Factors section set out on pages 11 to 20 of this document) that could affect the performance of Avation PLC and which are associated with investing in Avation PLC in the light of your own particular investment objectives, financial circumstances and needs before deciding whether to invest.
The distribution of this document and/or the accompanying documents in jurisdictions other than the UK, including the United States, Australia, Canada, India, Japan, New Zealand or the Republic of South Africa, may be restricted by law and therefore persons into whose possession this document comes should inform themselves about and observe any of those restrictions. Any failure to comply with any of those restrictions may constitute a violation of the securities laws of any such jurisdiction.
AVATION PLC
(Incorporated in England and Wales under the Companies Act 1985 with company number 05872328)
Acquisition of 21,065,334 Sale Shares in Capital Lease Aviation PLC and allotment of 2,786,061 New Ordinary Shares
55,663,727 Ordinary Shares in issue following Admission
This document does not constitute an offer to sell or an invitation to subscribe for, or the solicitation of an offer or invitation to buy or subscribe for, New Ordinary Shares in any jurisdiction where such an offer or solicitation is unlawful or would impose any unfulfilled registration, publication or approval requirements on the Company.
The New Ordinary Shares will not be registered under the US Securities Act of 1933, as amended (the Securities Act) or under the relevant laws of any state or other jurisdiction of the United States or under applicable securities laws of any state, province or territory of Australia, Canada, India, Japan, New Zealand or the Republic of South Africa and, accordingly, subject to certain exceptions, the Issue is not being made, and none of the New Ordinary Shares may be offered, sold, resold, delivered or transferred, directly or indirectly, in or into the United States, Australia, Canada, India, Japan, New Zealand or the Republic of South Africa or any other jurisdiction where such offer or sale would violate the relevant securities laws of such jurisdiction.
This Prospectus has not been, and will not be, lodged with ASIC and is not, and does not purport to be, a document containing disclosure to investors for the purposes of Chapter 6D of the Corporations Act. It is not intended to be used in connection with any offer, sale or issue for which disclosure is required and does not contain all the information that would be required by those provisions if they applied. No direct or indirect offers for issue or sale, and no invitations for applications for issue or offers to purchase, are being or will be made in, to or from Australia, and no prospectus, advertisement or other offering material relating to the New Ordinary Shares has been or will be distributed or published in Australia, unless: (a) such offer or invitation does not require disclosure to investors in accordance with Chapter 6D of the Corporations Act; (b) such action complies with all applicable laws, regulations and directives (including without limitation the licensing requirements set out in Chapter 7 of the Corporations Act); (c) such action does not require any document to be lodged with ASIC; and (d) the offer or invitation is made only to a person
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Publication of this document |
8 September 2015 |
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Trading of Existing Share Capital recommences |
8 September 2015 |
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Latest time and date for receipt of forms of proxy |
10.30 a.m. on 22 September 2015 |
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General Meeting |
10.30 a.m. on 24 September 2015 |
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Expected date of Punch Taverns plc general meeting |
28 September 2015 |
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Admission and dealings in the Placing Shares to commence on AIM |
8.00 a.m. on 29 September 2015 |
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Crediting of shares to CREST accounts |
29 September 2015 |
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Expected completion of the Acquisition |
2 October 2015 |
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Despatch of definitive share certificates |
13 October 2015 |
References to time are to London time unless otherwise stated. Each of the dates in the above timetable is indicative only and is subject to change without further notice.
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Directors |
David Alexander Robertson Adams (Chairman) Diana Hunter (Chief Executive Officer) Christopher Andrew Humphreys (Chief Financial Officer) Martin David Newman (Non-Executive Director) Stephen Graham Wilson (Non-Executive Director) Ian Martin Woodfine Jones (Non-Executive Director) each c/o Weston Road, Crewe, Cheshire CW1 6BP |
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Company secretary |
Christopher Andrew Humphreys |
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Registered office |
Weston Road Crewe Cheshire CW1 6BP |
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Nominated adviser, financial adviser, Joint bookrunner and Joint broker |
Zeus Capital Limited 82 King Street , Manchester, M2 4WQ and 41 Conduit Street, London, W1S 2YQ |
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Joint bookrunner and Joint broker |
Investec Bank plc 2 Gresham Street London EC2V 7QP |
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Legal advisers to the Company |
DLA Piper UK LLP 101 Barbirolli Square Manchester M2 3DL |
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Reporting accountants |
PricewaterhouseCoopers LLP 101 Barbirolli Square Manchester M2 3PW |
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Auditors |
Grant Thornton UK LLP 4 Hardman Square Spinningfields Manchester M3 3EB |
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Legal advisers to the nominated adviser and joint brokers |
Eversheds LLP 70 Great Bridgewater Street Manchester M1 5ES |
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Registrar |
Capita Asset Services The Registry 34 Beckenham Road Beckenham Kent BR3 4TU |
(Incorporated in England and Wales under the Companies Act 1985 with registered number 02700769)
One New Change London EC4M 9AF
13 April 2013
To holders of Ordinary Shares
Dear Shareholder
Proposed share capital reorganisation
Annual General Meeting
In addition to the routine business of this year’s Annual General Meeting (AGM), it is proposed to seek Shareholders’ approval for various matters relating to the Company’s capital structure. The purpose of this letter is to provide you with information on the proposals to be put to the AGM, to explain why your Board considers them to be in the best interests of the Company and Shareholders as a whole, and to recommend that you vote in favour of the Resolutions to be proposed at the Annual General Meeting.
Your specific attention is drawn to Resolution 11, which relates to the proposal to restructure the share capital of the Company. The Board believes that the Share Capital Reorganisation is in the best interests of Shareholders, its purpose being to reorganise the share capital of the Company with a view to streamlining the Company’s register, resulting in administrative cost savings whilst also reducing the large dealing spreads in the Existing Ordinary Shares. This reorganisation should also ensure that the price of the New Ordinary Shares is more appropriate for a company of the size and nature of Panmure Gordon & Co. plc.
We will be seeking your approval of the Share Capital Reorganisation at the forthcoming Annual General Meeting.
Details of all the Resolutions to be proposed at the Annual
General Meeting are set out below.
The Directors are required to lay the accounts for the year ended 31 December 2012 before a general meeting. Copies will be available at the Annual General Meeting.
The Articles of Association require any director appointed since the previous annual general meeting to stand for election at the next annual general meeting. Since Tamim Al-Kawari and Caspar Warre were both appointed as directors of the Company on 2 January 2013, each offers himself for election. Biographical details of Tamim Al-Kawari and Caspar Warre can be found in the Company’s report and financial statements for the year ended 31 December 2012.
The Articles of Association require one-third of the directors to retire at each annual general meeting. Anthony Cann will retire by rotation and seek re-election. Biographical details of Anthony Cann can be found in the Company’s report and financial statements for the year ended 31 December 2012.
As explained above, the Resolutions are subject to the approval of Shareholders in general meeting. A notice convening the Annual General Meeting of the Company to be held on Wednesday 22 May 2013 at 10.00 am at the Company’s offices at One New Change, London EC4M 9AF is set out at the end of this document.
You will find a Form of Proxy for use in connection with the Annual General Meeting enclosed with this document. The Form of Proxy should be completed in accordance with the instructions printed thereon, whether or not you intend to be present at the Annual General Meeting, and returned to the Company’s registrars, Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol, BS99 6ZY, as soon as possible and in any event, to be valid, so as to be received no later than 10.00 am on Monday 20 May 2013. Completion and return of the Form of Proxy will not prevent you from attending the Annual General Meeting and voting in person, if you so wish.
Your Board considers that all the resolutions proposed at the Annual General Meeting are in the best interests of the Company and its Shareholders as a whole. Accordingly, the Board unanimously recommends that Shareholders vote in favour of all the Resolutions as the Directors intend to do in respect of their own beneficial holdings in respect of which they have the power to exercise or direct the exercise of voting rights amounting in aggregate to 1,605,962 Ordinary Shares, representing approximately 1.04 per cent of the current issued ordinary share capital of the Company.
Summaries are made up of disclosure requirements known as ‘Elements’. These elements are numbered in Sections A – E (A.1 – E.7).
This summary contains all the Elements required to be included in a summary for this type of security and issuer. Because some Elements are not required to be addressed there may be gaps in the numbering sequence of the Elements.
Even though an Element may be required to be inserted into the summary because of the type of security and issuer, it is possible that no relevant information can be given regarding the Element. In this case a short description of the Element is included in the summary with the mention of ‘not applicable’.
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A1.2.2
A1.2.1
A1.1.1
A1.1.2
A1.5.1.2
A1.5.1.3
A1.4
A1.5.1.1
A1.3.1
A1.3.2
A1.5.1.4
A1.5.1.5
A1.5.2.1
A1.5.2.2
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table |
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0ement
Disclosurerequirement
Disclosure
A.1
Warning
This summary should be read as an introduction to the prospectus. Any decision to invest in the securities should be based on consideration of the prospectus as a whole by the investor. Where a claim relating to the information contained in a prospectus is brought before a court, the plaintiff investor might, under the national legislation of the Member States, have to bear the costs of translating such prospectus before the legal proceedings are initiated. Civil liability attaches only to those persons who have tabled the summary including any transaction thereof, but only if the summary is misleading, inaccurate or inconsistent when read together with the other parts of the prospectus or it does not provide, when read together with the other parts of the prospectus, key information in order to aid investors when considering whether to invest in such securities.
A.2
Subsequent resale of securities or final placement of securities through financial intermediaries
Not applicable. The Company is not engaging any financial intermediaries for any resale of securities or final placement of securities requiring a prospectus after publication of this document.
Element
Disclosure requirement
Disclosure
B.1
Legal and commercial name
The issuer’s legal and commercial name is Greencoat UK Wind PLC
B.2
Domicile and legal form
The Company was incorporated in England and Wales on 4 December 2012 with registered number 08318092 as a public company with an unlimited life under the Companies Act 2006.
B.5
Group description
The Company makes its investments via a group structure which comprises the LLP and Holdco, a wholly-owned subsidiary of the LLP. The Company and the Investment Manager are the only members of the LLP. Members’ decisions are taken jointly by designated representatives of each member, with the chairman of the Company having a casting vote in the event of deadlock. Both the LLP and Holdco are party to the Investment Management Agreement. Holdco invests either directly or indirectly in the SPVs which own the wind farms.
B.6
Major shareholders
As at the close of business on 24 September 2014 (the latest practicable date prior to publication of this Prospectus), the interests of the Directors and their connected persons in the share capital of the Company are as follows:
Tim Ingram holds 160,706 Ordinary Shares.
Shonaid Jemmett-Page and her spouse hold 23,060 Ordinary Shares.
William Rickett and members of his family hold 37,500 Ordinary Shares.
Dan Badger and his spouse hold 23,080 Ordinary Shares.
Kevin McCullough holds 10,000 Ordinary Shares.
Insofar as is known to the Company, as at the close of business on 24 September 2014 (the latest practicable date prior to publication of this Prospectus) the following registered holdings representing a direct or indirect interest of three per cent. or more of the Company’s issued share capital were recorded on the Company’s share register:
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Shareholder |
Ordinary Shares currently held |
Ordinary Shares currently held (%) |
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BIS |
50,000,000 |
14.54 |
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Sarasin & Partners LLP |
25,469,032 |
7.41 |
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Investec Wealth & Investment Limited |
18,383,421 |
5.91 |
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Baillie Gifford & Co Limited |
14,723,392 |
5.35 |
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Aberdeen Asset Management Limited |
20,332,149 |
4.28 |
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AXA Investment Managers Limited |
10,600,000 |
3.08 |
Historical financial information
Selected historical financial information of the Group for the financial period from 4 December 2012 to 31 December 2013 and the periods from 4 December 2012 to 30 June 2013 and 1 January 2014 to 30 June 2014 is set out below. The information set out in the table below has been extracted directly without material adjustment from the audited accounts of the Group for the period from 4 December 2012 to 31 December 2013 and the unaudited half-year reports for the periods from 4 December 2012 to 30 June 2013 and 1 January 2014 to 30 June 2014.
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As at 30 June 2013 |
As at 31 December 2013 |
As at 30 June 2014 |
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Total assets (£m) |
263.2 |
402.3 |
498.0 |
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Total liabilities (£m) |
0.2 |
51.2 |
136.1 |
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Net assets (£m) |
263.0 |
351.1 |
361.9 |
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Net assets per Ordinary Share (p) |
101.1 |
102.9 |
105.4 |
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From 4 December 2012 to 30 June 2013 |
From 4 December 2012 to 31 December 2013 |
From 1 January 2014 30 June 2014 |
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Earnings per Ordinary Share (p) |
2.94 |
6.89 |
5.47 |
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Dividend per Ordinary Share (p) |
1.50 |
4.50 |
3.08 |
There has been no significant change in the financial or trading position of the Group during the period covered by the historical financial information other than: (i) First Admission; (ii) the acquisition of investments in the Portfolio and associated draw down of £130 million under the Acquisition Facility Agreement in October and November 2013; (iii) the issue of 80,975,610 Ordinary Shares under the Company’s fundraising in December 2013 and associated prepayment of £80 million of acquisition debt; (iv) the prepayment of £8 million of acquisition debt in March 2014; and (v) the acquisition of further investments in the Portfolio and associated draw down of £93 million under the Acquisition Facility Agreement in June 2014.
There has been no significant change in the financial or trading position of the Group subsequent to the period covered by the historical financial information, other than acquisition of an indirect 51.6 per cent. interest in each of Drone Hill SPV, North Rhins SPV, Sixpenny Wood SPV and Yelvertoft SPV and associated draw down of £90 million under the Acquisition Facility Agreement.
Notice is given that a general meeting of Conviviality Retail Plc (“Company”) will be held at Unit 1, Weston Road, Crewe, Cheshire CW1 6BP on 24 September 2015 at 10.30 a.m. or, if the annual general meeting of the Company scheduled to commence at 10.00 a.m. on this date, is not finished immediately after conclusion of such annual general meeting for the purposes of considering and, if thought fit, passing the following resolutions. Resolutions 1 and 2 will be proposed as ordinary resolutions and resolutions 3 and 4 will be proposed as special resolutions.
THAT the proposed acquisition by Conviviality Brands Limited (a wholly owned subsidiary of theCompany) of the entire issued share capital of Matthew Clark (Holdings) Limited (company number 6133835) on the terms summarised in the admission document issued by the Company dated 8 September 2015 (“Admission Document”) be and are hereby approved and that the directors of the Company, or a duly constituted committee of the directors, be and are hereby authorised to waive, amend, vary or extend any of the terms and conditions of the Acquisition (as defined in the Admission Document) or the Acquisition Agreement (as also so defined) or related agreements (but not to a material extent) and do all such things they may consider necessary or desirable in connection with the Acquisition.
THAT, subject to the passing of resolution 1, pursuant to section 551 of the Companies Act 2006 (“Act”), the directors be and are generally and unconditionally authorised to exercise all powers of the Company to allot shares in the Company up to an aggregate nominal amount of:
£17,333.3334, in respect of the proposed Placing (as defined and summarised in the AdmissionDocument); and
otherwise, £4,648.29,
provided that (unless previously revoked, varied or renewed) this authority shall expire on the earlier of 24 December 2016 or the conclusion of the Company's annual general meeting to be held in 2016, save that the Company may make an offer or agreement before this authority expires which would or might require shares to be allotted or rights to subscribe for or to convert any security into shares to be granted after this authority expires and the directors may allot shares or grant such rights pursuant to any such offer or agreement as if this authority had not expired.
This authority is in substitution for all existing authorities under section 551 of the Act (which, to the extent unused at the date of this resolution, are revoked with immediate effect).
THAT subject to the passing of resolution 2 and pursuant to section 570 of the Act, the directors beand are generally empowered to allot equity securities (within the meaning of section 560 of the Act) for cash pursuant to the authority granted by resolution 2 as if section 561(1) of the Act did not apply to any such allotment, provided that this power shall be limited to the allotment of equity securities:
referred to in resolution 2.1, in respect of the proposed Placing (as defined and summarised inthe Admission Document)
in connection with an offer of equity securities (whether by way of a rights issue, open offer orotherwise):
to holders of ordinary shares in the capital of the Company in proportion (as nearly aspracticable) to the respective numbers of ordinary shares held by them; and
to holders of other equity securities in the capital of the Company, as required by the rightsof those securities or, subject to such rights, as the directors otherwise consider necessary,
but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in relation to treasury shares, fractional entitlements, record dates or any legal or practical problems under the laws of any territory or the requirements of any regulatory body or stock exchange; and
otherwise than pursuant to paragraphs 3.1 and 3.2 of this resolution, up to an aggregatenominal amount of £1,549.43,
and this power shall expire at the conclusion of the annual general meeting of the Company to be held in 2016 or on 24 December 2016 (whichever is the earlier), save that the Company may make an offer or agreement before this power expires which would or might require equity securities to be allotted for cash after this power expires and the directors may allot equity securities for cash pursuant to any such offer or agreement as if this power had not expired.
This power is in substitution for all existing powers under section 570 of the Act (which, to the extent unused at the date of this resolution, are revoked with immediate effect).
That the name of the Company be changed to “Conviviality Plc”
By order of the board
Christopher Andrew Humphreys
Company Secretary
8 September 2015
Registered office
Weston Road
Crewe
Cheshire
CW1 6BP
Registered in England and Wales No. 5592636
Notes
Entitlement to attend and vote
The right to vote at the meeting is determined by reference to the register of members. Only those shareholders registered inthe register of members of the Company as at 6.00pm on 22 September 2015 (or, if the meeting is adjourned, 6.00pm on the date which is two days before the date of the adjourned meeting) shall be entitled to attend and vote at the meeting in respect of the number of shares registered in their name at that time. Changes to entries in the register of members after that time shall be disregarded in determining the rights of any person to attend or vote (and the number of votes they may cast) at the meeting.
A shareholder is entitled to appoint another person as his or her proxy to exercise all or any of his or her rights to attend andto speak and vote at the meeting. A proxy need not be a shareholder of the Company.
A shareholder may appoint more than one proxy in relation to the meeting, provided that each proxy is appointed to exercise the rights attached to a different share or shares held by that shareholder. Failure to specify the number of shares each proxy appointment relates to or specifying a number which when taken together with the numbers of shares set out in the other proxy appointments is in excess of the number of shares held by the shareholder may result in the proxy appointment being invalid.
A proxy may only be appointed in accordance with the procedures set out in notes 3 to 4 below and the notes to the proxy form.
The appointment of a proxy will not preclude a shareholder from attending and voting in person at the meeting.
A form of proxy is enclosed. When appointing more than one proxy, complete a separate proxy form in relation to eachappointment. Additional proxy forms may be obtained by contacting the Company's registrar on 0371 664 0300 from within the UK or on + 44 20 8639 3399 if calling from outside the UK. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 9.00 a.m. – 5.30 p.m., Monday to Friday excluding public holidays in England and Wales. Different charges may apply to calls from mobile telephones and calls may be recorded and randomly monitored for security and training purposes or the proxy form may be photocopied. State clearly on each proxy form the number of shares in relation to which the proxy is appointed.
To be valid, a proxy form must be received by post or (during normal business hours only) by hand at the offices of the Company's registrar, Capita Asset Services, PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU, no later than 10.30 a.m. on 22 September 2015 (or, if the meeting is adjourned, no later than 48 hours before the time of any adjourned meeting).
CREST members who wish to appoint a proxy or proxies for the meeting (or any adjournment of it) through the CRESTelectronic proxy appointment service may do so by using the procedures described in the CREST Manual. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.
In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK & Ireland Limited's specifications and must contain the information required for such instructions, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy, must, in order to be valid, be transmitted so as to be received by Capita Registrars Limited (ID RA10) no later than 10.30 a.m. on 22 September 2015 (or, if the meeting is adjourned, no later than 48 hours before the time of any adjourned meeting). For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Applications Host) from which Capita Asset Services is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time, any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means.
CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed a voting service provider(s), to procure that his or her CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
The Company may treat a CREST Proxy Instruction as invalid in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
A shareholder which is a corporation may authorise one or more persons to act as its representative(s) at the meeting. Eachsuch representative may exercise (on behalf of the corporation) the same powers as the corporation could exercise if it were an individual shareholder, provided that (where there is more than one representative and the vote is otherwise than on a show of hands) they do not do so in relation to the same shares.
As at 7 September 2015 (being the last practicable date before the publication of this notice), the Company's issued sharecapital consists of 66,942,357 ordinary shares of £0.0002 each, carrying one vote each. The Company does not hold any ordinary shares in treasury. Therefore, the total voting rights in the Company as at 7 September 2015 are 66,942,357.
The following documents will be available for inspection during normal business hours at the registered office of the Companyand at the offices of DLA Piper UK LLP at 3 Noble Street, London EC2V 7EE from the date of this notice until the time of the meeting. They will also be available for inspection at the place of the meeting from at least 15 minutes before the meeting until it ends:
Copy of the Admission Document issued by the Company dated 8 September 2015;
Copies of the service contracts of the executive directors.
Copies of the letters of appointment of the non-executive directors.
Except as provided above, shareholders who wish to communicate with the Company in relation to the meeting should doso by calling our shareholder helpline on 0371 664 0300 from within the UK or on + 44 20 8639 3399 if calling from outside the UK. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 9.00 a.m. – 5.30 p.m., Monday to Friday excluding public holidays in England and Wales. Different charges may apply to calls from mobile telephones and calls may be recorded and randomly monitored for security and training purposes.
No other methods of communication will be accepted. Any electronic communication sent by a shareholder to the Company or Capita Asset Services which is found to contain a virus will not be accepted by the Company.
(Incorporated in England and Wales under the Companies Act 1985 with registered number 02700769)
One New Change London EC4M 9AF
13 April 2013
To holders of Ordinary Shares
Dear Shareholder
Proposed share capital reorganisation
Annual General Meeting
On 6 November 2014, the Board announced that CWC had agreed terms to acquire Columbus International Inc (“Columbus”) for consideration of approximately USD1.85bn (for 100 per cent. of the equity). In addition, CWC will assume Columbus’ existing net debt as part of the Acquisition which was USD1.17bn7 as at 30 June 2014.
The consideration will be settled through the payment of approximately USD707.5m in cash (the “Cash Consideration”) and the issue to the Principal Vendors of 1,557,529,605 new Ordinary Shares (the “Consideration Shares”)8. As a result, the Principal Vendors will in aggregate hold 36 per cent. of the Ordinary Shares in the Enlarged Group (after accounting for the Placing as described below)9. Each Principal Vendor has agreed at Completion to enter into lock-up and put option arrangements in respect of its Consideration Shares, an exception to which will enable it to require the Company to acquire certain of the Consideration Shares at their notional issue price of USD0.734910 in certain circumstances. Further details regarding the arrangements are set out in paragraph 9 (Outline of the Acquisition) of this letter and in Part V (Principal terms of the Share Purchase Agreement and other related documentation) of this circular.
On 6 November 2014, the Company also announced the placing of up to 252,812,284 new CWC Shares representing approximately 9.99 per cent. of CWC’s existing issued share capital (the “Placing”), which raised gross proceeds of approximately GBP113.8m. The Company proposes to use the net proceeds of the Placing and funds to be drawn down at Completion from the new debt financing (details of which are set out in paragraph 11 (New Financing) of this letter) to fund the Cash Consideration.
In connection with the Acquisition, CWC launched a consent solicitation in respect of its USD400m 83⁄4 per cent. Senior Secured Notes due 2020 (the “SIFL Bonds”), issued by its wholly-owned subsidiary Sable International Finance Limited (“SIFL”) on 7 November 2014. The consent solicitation seeks approval of
Set out at the end of this circular is a notice convening a General Meeting to be held at Hilton Hotel Paddington, 146 Praed Street, London W2 1EE, at 10.05 a.m. on 5 December 2014. This General Meeting is to be held for the purpose of considering and, if thought fit, passing the GM Resolutions. The Acquisition is conditional upon all the requisite GM Resolutions being passed. A summary and explanation of the GM Resolutions is set out below, but please note that this does not contain the full text of the GM Resolutions and you should read this in conjunction with the GM Resolutions in the Notice of General Meeting at the end of this circular.
At the General Meeting you will be asked to approve:
subject to resolutions 2, 3 and 6 being approved, an ordinary resolution (numbered 1) approving the Acquisition and the associated and ancillary arrangements related to it;
subject to resolutions 1, 3 and 6 being approved, an ordinary resolution (numbered 2) granting the Directors authority to issue up to 1,557,529,605 new ordinary shares in the capital of the Company up to an aggregate nominal amount of USD77,876,480.25 in connection with the Acquisition and authority to issue up to 130,000,000 new ordinary shares in the capital of the Company up to an aggregate nominal amount of USD6,500,000 in connection with the rollover or satisfaction of awards under Columbus International Inc’s share schemes and/or other arrangements considered desirable to incentivise persons holding awards thereunder, such authorities to expire on 30 September 2015;
subject to resolutions 1, 2 and 6 being approved, an ordinary resolution (numbered 3) approving the entry into of, and performance of the Company’s obligations under, each Put Option Deed, such approval to expire on the fifth anniversary of this resolution;
subject to resolutions 1, 2, 3 and 6 being approved, an ordinary resolution (numbered 4) granting the Directors authority to issue up to 2,000,000,000 new ordinary shares in the capital of the Company up to an aggregate nominal amount of USD100,000,000 in connection with the Company funding the payment of all or part of the price due by it on repurchase of any of the ordinary shares pursuant to an exercise under the Put Option Deeds, such authority to expire on the fifth anniversary of this resolution;
subject to resolutions 1, 2, 3 and 6 being approved, an ordinary resolution (numbered 5) approving the terms of the Deferred Bonus Plan; and
OR, if the Scheme is to be effected:
subject to the Scheme being approved at the Court Meeting and resolution 6 being approved, a special resolution (numbered 7) approving matters necessary to implement the Scheme, including the CWC Reduction of Capital, the establishment of New CWC as the new holding company of the CWC Group and the ancillary matters including amendments to CWC’s Articles and the authorisation of the allotment of CWC Shares pursuant to the Scheme;
subject to the Scheme referred to in resolution 7 becoming effective and to the passing of resolution 6, ordinary resolutions (numbered 8) approving the adoption by New CWC of the New Share Plans; and
AND, in either case:
subject to resolutions 1, 2 and 3 or, if applicable, resolutions 7 and 8 being approved, an ordinary resolution (numbered 6) to approve certain waivers granted by the Panel of obligations that might otherwise arise on the Concert Parties and/or any person acting in concert with them to make a general offer to Shareholders as a result of or following the Acquisition.
It is intended that Resolutions 1-5 will not be put before the General Meeting if the Scheme is required. If the Scheme is required, Resolutions 7 and 8 will instead be put before the General Meeting. Resolution 6 will be put before the General Meeting whether or not the Scheme is required. Nonetheless Shareholders are asked to return Forms of Proxy completed in respect of all Resolutions.
If ordinary resolution 2 is passed, the Directors shall have the authority to allot, in addition to any other authority conferred on the Directors including at the last annual general meeting of the Company, CWC Shares or grant rights to subscribe for or convert any securities into CWC Shares up to an aggregate nominal amount equal to USD77,876,480.25 (representing 1,557,529,605 CWC Shares of USD0.05 each) together with any additional shares and/or rights to subscribe for or convert any security into shares in the Company, credited as fully paid, in connection with the rollover or satisfaction of awards under Columbus
International Inc’s share schemes and/or other arrangements considered desirable to incentivise persons holding awards thereunder up to an aggregate nominal amount of USD6,500,000 (representing 130,000,000 CWC Shares of USD0.05 each). This authority will expire on 30 September 2015 and is in addition to any subsisting authorities to allot shares in the Company.
If ordinary resolution 4 is passed, the Directors shall have the authority to allot, in addition to any other authority conferred on the Directors including at the last annual general meeting of the Company and pursuant to resolution 2, CWC Shares up to an aggregate nominal amount equal to USD100,000,000 (representing 2,000,000,000 CWC Shares of USD0.05 each). This authority is to enable the Company to allot new shares (if required) to fund its payment obligations under any Put Option Deeds exercised by the holders thereof. The current intention of the Directors is to cancel all shares bought back following the exercise of a put under a Put Option Deed to minimise any dilution to Shareholders. This authority will expire on the fifth anniversary of the resolution being passed and is in addition to any subsisting authorities to allot shares in the Company.
Please see paragraph 10 (Rule 9 Waiver) of this letter for further information on resolution 6, the Whitewash Resolution.
As at the Latest Practicable Date, CWC held 137,488,873 shares in treasury, which amounted to 4.71 per cent. of the then issued ordinary share capital (including treasury shares).
The Directors have no present intention to issue new ordinary shares, other than pursuant to the Acquisition, the CWC Share Plans and in connection with the Company funding the payment of all or part of the price due by it on repurchase of any of the Ordinary Shares pursuant to an exercise under the Put Option Deeds.
The resolutions at the General Meeting will be determined by a poll and not a show of hands. Resolutions 1-5 and 8 will be passed if more than 50 per cent. of the votes cast (either in person or by proxy) are in favour of the resolutions. Resolution 7 will be passed if not less than 75 per cent. of the votes cast (either in person or by proxy) are in favour of the resolution. Resolution 6, the Whitewash Resolution, will be passed if more than 50 per cent. of the votes cast by the Independent Shareholders (either in person or by proxy) are in favour of the resolution.
Set out at the end of this circular is a notice convening the Court Meeting to be at Hilton Hotel Paddington, 146 Praed Street, London W2 1EE, on 5 December 2014.
At the Court Meeting, you will be asked to approve the Scheme. In so approving the Scheme, Shareholders will also be approving the acquisition of Columbus by New CWC. The statutory majority required to approve the Scheme at the Court Meeting is a majority in number of those Shareholders who are present and vote in person or by proxy, and those voting in favour must also represent 75 per cent. or more in value of the CWC Shares that are voted.
Authority to undertake the New CWC Reduction of Capital will be granted to the directors of New CWC by the present voting members of New CWC prior to the Scheme Effective Date. The directors of New CWC will be authorised to implement the New CWC Reduction of Capital only if Shareholders pass the special resolution, numbered 7, which will be proposed at the General Meeting to approve matters necessary to implement the Scheme.
Prior to the Scheme Effective Date, a general meeting of New CWC will be held at which shareholder approval will be sought for the directors of New CWC to be granted: (a) authority to allot New CWC Shares requisite to the implementation of the Scheme; (b) authority to allot the requisite number of New CWC Shares to the Principal Vendors as part of the consideration for the Acquisition; (c) authority to allot New CWC Shares to fund the payment of all or part of the price due by it on repurchase of any of the Ordinary Shares pursuant to an exercise under the Put Option Deeds; (d) general authorities to allot New CWC Shares, to make allotments otherwise than in accordance with pre-emption rights and to make purchases of New CWC Shares, with all such authorities to be based on the expected issued share capital of New CWC following the Acquisition; (e) authority to adopt a directors’ remuneration policy which shall be equivalent in all material respects to the policy adopted by CWC; and (f) authority to adopt any other policy, procedure, terms of reference or similar document which is equivalent in all material respects to the policy, procedure, terms of reference or similar document adopted by CWC.
Accordingly, Shareholders will not be required separately to approve the New CWC Reduction of Capital or any of the other shareholder authorities referred to above once they have become holders of New CWC Shares pursuant to the Scheme.
The following applies only to persons who are the beneficial owners of Bonds and is a summary of the Issuer's understanding of current United Kingdom law and published HM Revenue & Customs practice relating to certain aspects of United Kingdom taxation as at the date of this Prospectus. Some aspects do not apply to certain classes of person (such as dealers and persons connected with the Issuer) to whom special rules may apply. The United Kingdom tax treatment of prospective holders of the New Bonds depends on their individual circumstances and may be subject to change at any time in the future, possibly with retrospective effect. This is not intended to constitute a complete analysis of all tax consequences relating to the ownership of the Bonds and is not intended to be, nor should it be considered to be, legal or tax advice. Prospective holders of New Bonds who may be subject to tax in a jurisdiction other than the United Kingdom or who may be unsure as to their tax position should seek their own professional advice.
Payment of interest on the Bonds
Payments of interest by the Issuer on the Bonds may be made without deduction of or withholding on account of United Kingdom income tax provided that the Bonds continue to be listed on a "recognised stock exchange" within the meaning of section 1005 of the Income Tax Act 2007. The London Stock Exchange is a recognised stock exchange for these purposes. Securities will be treated as listed on the London Stock Exchange if they are included in the Official List (within the meaning of and in accordance with the provisions of Part 6 of the Financial Services and Markets Act 2000) and admitted to trading on the London Stock Exchange. Provided, therefore, that the Bonds remain so listed, interest on the Bonds will be payable without withholding or deduction on account of United Kingdom tax.
Interest on the Bonds may also be paid without withholding or deduction on account of United Kingdom tax where interest on the Bonds is paid by a company and, at the time the payment is made, the Issuer reasonably believes (and any person by or through whom interest on the Bonds is paid reasonably believes) that the beneficial owner is within the charge to United Kingdom corporation tax as regards the payment of interest, provided that HM Revenue & Customs (HMRC) has not given a direction (in circumstances where it has reasonable grounds to believe that it is likely that the above exemption is not available in respect of such payment of interest at the time the payment is made) that the interest should be paid under deduction of tax.
In other cases, an amount must generally be withheld from payments of interest on the Bonds that has a United Kingdom source on account of United Kingdom income tax at the basic rate (currently 20 per cent.). However, where an applicable double tax treaty provides for a lower rate of withholding tax (or for no tax to be withheld) in relation to a Bondholder, HMRC can issue a notice to the Issuer to pay interest to the Bondholder without deduction of tax (or for interest to be paid with tax deducted at the rate provided for in the relevant double tax treaty).
HMRC has powers to obtain information and documents relating to the Bonds, including in relation to issues of and other transactions in the Bonds, interest, payments treated as interest and other payments derived from the Bonds. This may include details of the beneficial owners of the Bonds, of the persons for whom the Bonds are held and of the persons to whom payments derived from the Bonds are or may be paid. Information may be obtained from a range of persons including persons who effect or are a party to such transactions on behalf of others, registrars and administrators of such transactions, the registered holders of the Bonds, persons who make, receive or are entitled to receive payments derived from the Bonds and persons by or through whom interest and payments treated as interest are paid or credited. Information obtained by HMRC may be provided to tax authorities in other jurisdictions.
EU Savings Directive
Under Council Directive 2003/48/EC on the taxation of savings income, Member States are required to provide to the tax authorities of other Member States details of certain payments of interest or similar income paid or secured by a person established in a Member State to or for the benefit of an individual resident in another Member State or certain limited types of entities established in another Member State.
On 24th March, 2014, the European Council adopted an EU Council Directive amending and broadening the scope of the requirements described above. Member States are required to apply these new requirements from 1st January, 2017. The changes will expand the range of payments covered by the Directive, in particular to include additional types of income payable on securities. The Directive will also expand the circumstances in which payments that indirectly benefit an individual resident in a Member State must be reported. This approach will apply to payments made to, or secured for, persons, entities or legal arrangements (including trusts) where certain conditions are satisfied, and may in some cases apply where the person, entity or arrangement is established or effectively managed outside of the European Union.
For a transitional period, Luxembourg and Austria are required (unless during that period they elect otherwise) to operate a withholding system in relation to such payments. The changes referred to above will broaden the types of payments subject to withholding in those Member States which still operate a withholding system when they are implemented. In April 2013, the Luxembourg Government announced its intention to abolish the withholding system with effect from 1st January, 2015, in favour of automatic information exchange under the Directive.
The end of the transitional period is dependent upon the conclusion of certain other agreements relating to information exchange with certain other countries. A number of non- EU countries and territories including Switzerland have adopted similar measures (a withholding system in the case of Switzerland).
Further United Kingdon Income Tax Issues
Interest on the Bonds that constitutes United Kingdom source income for tax purposes may, as such, be subject to income tax by direct assessment even where paid without withholding.
However, interest with a United Kingdom source received without deduction or withholding on account of United Kingdom tax will not be chargeable to United Kingdom tax in the hands of a Bondholder (other than certain trustees) who is not resident for tax purposes in the United Kingdom unless that Bondholder carries on a trade, profession or vocation in the United Kingdom through a United Kingdom branch or agency in connection with which the interest is received or to which the Bonds are attributable (and where that Bondholder is a company, unless that Bondholder carries on a trade in the United Kingdom through a permanent establishment in connection with which the interest is received or to which the Bonds are attributable). There are exemptions for interest received by certain categories of agent (such as some brokers and investment managers). The provisions of an applicable double taxation treaty may also be relevant for such Bondholders.
In general, Bondholders which are within the charge to United Kingdom corporation tax will be charged to tax as income on all returns, profits or gains on, and fluctuations in value of, the Bonds (whether attributable to currency fluctuations or otherwise) broadly in accordance with their statutory accounting treatment.
Taxation of Chargeable Gains
The Bonds will constitute "qualifying corporate bonds" within the meaning of section 117 of the Taxation of Chargeable Gains Act 1992. Accordingly, a disposal by a Bondholder of a Bond will not give rise to a chargeable gain or an allowable loss for the purposes of the UK taxation of chargeable gains.
Accrued Income Scheme
On a disposal of Bonds by a Bondholder, any interest which has accrued since the last interest payment date may be chargeable to tax as income under the rules of the accrued income scheme as set out in Part 12 of the Income Tax Act 2007, if that Bondholder is resident in the United Kingdom or carries on a trade in the United Kingdom through a branch or agency to which the Bonds are attributable.
Taxation of Discount
HMRC's published practice is that securities having similar terms of early redemption as the Bonds are not treated by HMRC'as "deeply discounted securities" and accordingly the Bonds should not be treated as "deeply discounted securities" for the purposes of Chapter 8 of Part 4 of the Income Tax (Trading and Other Income) Act 2005.
No United Kingdom stamp duty or SDRT is payable on the issue of the Bonds or on a transfer by delivery of the Bonds.
On 14th February, 2013, the European Commission has published a proposal (the Commission's Proposal) for a Directive for a common FTT in Belgium, Germany, Estonia, Greece, Spain, France, Italy, Austria, Portugal, Slovenia and Slovakia (the participating Member States).
The Commission's Proposal has very broad scope and could, if introduced, apply to certain dealings in the Bonds (including secondary market transactions) in certain circumstances.
Under the Commission's Proposal the FTT could apply in certain circumstances to persons both within and outside of the participating Member States. Generally, it would apply to certain dealings in the Bonds where at least one party is a financial institution, and at least one party is established in a participating Member State. A financial institution may be, or be deemed to be, "established" in a participating Member State in a broad range of circumstances, including (a) by transacting with a person established in a participating Member State or (b) where the financial instrument which is subject to the dealings is issued in a participating Member State.
A joint statement issued in May 2014 by ten of the eleven participating Member States indicated an intention to implement the FTT progressively, such that it would initially apply to shares and certain derivatives, with this initial implementation occurring by 1st January, 2016. The FTT, as initially implemented on this basis, may not apply to dealings in the Bonds.
The FTT proposal remains subject to negotiation between the participating Member States. It may therefore be altered prior to any implementation. Additional EU Member States may decide to participate.
Prospective holders of the Bonds are advised to seek their own professional advice in relation to the FTT.