RNS Number : 2640L
Utilico Finance Limited
02 July 2014
 



For release on 2 July 2014

 

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, INTO THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

 

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER OR INVITATION TO PURCHASE OR ACQUIRE ANY TRANSFERABLE SECURITIES (AS DEFINED IN SCHEDULE 11A OF THE FINANCIAL SERVICES AND MARKETS ACT 2000), NOR SHALL IT FORM THE BASIS OF ANY CONTRACT FOR THE SALE OF ANY INTEREST IN A TRANSFERABLE SECURITY OR A SOLICITATION, INDUCEMENT, ADVICE OR RECOMMENDATION TO EFFECT ANY TRANSACTION OF ANY KIND WHATSOEVER. POTENTIAL INVESTORS SHOULD READ THE RELEVANT PROSPECTUS (WHICH HAS BEEN PUBLISHED FOLLOWING APPROVAL BY THE UK LISTING AUTHORITY) CAREFULLY BEFORE ANY INVESTMENT DECISION IS MADE.

 

Utilico Investments Limited

Utilico Finance Limited

(together the "Group")

 

Publication of prospectus

 

Further to the announcement on 23 June 2014, the Group announces that it has today published a prospectus, which has been approved by the UK Listing Authority, in connection with:

·      a rollover offer of 2014 ZDP Shares into 2020 ZDP Shares:

·      the issue of up to 25,000,000 2020 ZDP Shares pursuant to an initial placing and a placing programme; and

·      the issue of up to 10,000,000 2016 ZDP Shares and up to 10,000,000 2018 ZDP Shares pursuant to a placing programme.

 

The text of the Chairman's letter extracted from the Prospectus which contains details of the Proposals is set out below.

A copy of the Prospectus will be submitted to the National Storage Mechanism and will shortly be available for inspection at: www.Hemscott.com/nsm.do and on the Company's website: www.utilico.bm

Terms used and not defined in this announcement bear the meaning given to them in the Prospectus to be published today.

Chairman's Letter

"To holders of 2014 ZDP Shares and, for information only, to holders of Ordinary Shares, 2016 ZDP Shares and 2018 ZDP Shares

 

Introduction

Your Board has today announced detailed proposals to provide holders of existing 2014 ZDP Shares with the opportunity to roll over some or all (subject to the overall limits of the Rollover Offer) of their 2014 ZDP Shares into a new class of 2020 ZDP Shares. In addition, your Board has announced proposals for an Initial Placing of up to 25,000,000 2020 ZDP Shares (less the number of 2020 ZDP Shares issued pursuant to the Rollover Offer) and a Placing Programme of up to 25,000,000 2020 ZDP Shares (less the number of 2020 ZDP Shares issued pursuant to the Rollover Offer and the Initial Placing), up to 10,000,000 2016 ZDP Shares and up to 10,000,000 2018 ZDP Shares.

 

The purpose of this letter is to explain the Proposals and why the Board considers them in the best interests of ZDP Shareholders as a whole.

 

Background to the Proposals

Utilico Finance currently has three series of ZDP Share in issue. These are due for redemption on 31 October in 2014, 2016 and 2018 respectively. The aggregate redemption sum payable on the redemption of the 2014 ZDP Shares is approximately £79.6 million. This will be due on 31 October 2014. Following discussions regarding the payment of the Final Capital Entitlement in respect of the 2014 ZDP Shares, the Directors concluded that they wish to provide 2014 ZDP Shareholders with the opportunity to remain invested in the Group and as a result have formulated the Proposals, which consist of the Rollover Offer, Initial Placing and Placing Programme.

 

The Rollover Offer

Under the Rollover Offer, each Qualifying Holder of 2014 ZDP Shares on the Record Date will be given the opportunity to rollover some or all of their Qualifying Holding (subject to the overall limits of the Rollover Offer) into new 2020 ZDP Shares. The Rollover Value attributed to each 2014 ZDP Share will be 165.25p, a premium of 0.35 per cent. to their Accrued Capital Entitlement as at the Rollover Date. The new 2020 ZDP Shares arising on the conversion of 2014 ZDP Shares pursuant to the Rollover Offer will be deemed to be issued at the 2020 ZDP Share issue price, which will be 100p per 2020 ZDP Share.

 

The 2020 ZDP Shares will have a Gross Redemption Yield of 7.25 per cent. and a maturity date of 31 October 2020. Based on the Assumptions, if pursuant to the Rollover Offer 10,000,000 new 2020 ZDP Shares arise on the conversion of 2014 ZDP Shares, the 2020 ZDP Shares will have a ZDP Cover of 1.46x following the Rollover Offer.

 

Investors should note that the predetermined capital entitlement of the ZDP Shares is not guaranteed and is dependent upon Utilico having sufficient assets to satisfy its obligations under the Subscription Agreement.

 

There is no present intention to put forward further proposals to 2014 ZDP Shareholders in advance of the ZDP Repayment Date on 31 October 2014.

 

The Initial Placing and the Placing Programme

Utilico Finance also intends to issue up to 25,000,000 2020 ZDP Shares (less the number of 2020 ZDP Shares issued under the Rollover Offer) pursuant to the Initial Placing and the Placing Programme and up to 10,000,000 2016 ZDP Shares and up to 10,000,000 2018 ZDP Shares pursuant to the Placing Programme.

 

Under the Initial Placing, Utilico Finance is proposing to issue up to 25,000,000 2020 ZDP Shares (less the number of 2020 ZDP Shares issued under the Rollover Offer) at the Initial Placing Price, which will be 100p per 2020 ZDP Share. Westhouse Securities has agreed under the Placing Agreement to use its reasonable endeavours to procure placees for 2020 ZDP Shares at the Initial Placing Price. Details of the Placing Agreement are set out in paragraph 8.9 of Part 9 of this document. The Initial Placing will close at 11.00 a.m. on 25 July 2014 (or such later date, not being later than 31 August 2014, as the Company and Westhouse Securities may agree). If the Initial Placing is extended, the revised timetable will be notified via an RIS.

 

Under the Placing Programme, Utilico Finance has the ability to issue up to 25,000,000 2020 ZDP Shares (less the number of 2020 ZDP Shares issued under the Rollover Offer and the Initial Placing), up to 10,000,000 2016 ZDP Shares and up to 10,000,000 2018 ZDP Shares at the applicable Issue Price. The Placing Programme is flexible and may have a number of closing dates in order to provide Utilico Finance with the ability to issue Placing ZDP Shares over a period of time. The Placing Programme will open on 2 July 2014 and will close on 1 July 2015 (or any earlier date on which it is fully subscribed). The Placing ZDP Shares will, when issued, rank equally with the ZDP Shares of the relevant class then in issue.

 

Benefits of the Proposals

The Board believes the Proposals have the following advantages:

·      to allow Utilico Finance to issue a new class of 2020 ZDP Shares to satisfy demand over a period of time;

·      to increase the number of 2020 ZDP Shares in issue following the Rollover Offer, thereby enabling the Company to attract a wider range of investors which, in turn, would be expected to improve the liquidity in the 2020 ZDP Shares; and

·      to raise new funds to assist financing the amount required for the redemption of the 2014 ZDP Shares.

 

As at the date of this document, the Company's borrowings under its loan facility of £50 million from

Scotiabank Europe plc amounted to £22.3 million, reflecting the realisation of investments from the Company's portfolio. The Company intends to realise further investments from the Company's portfolio to raise approximately £25 million and expects to raise the balance of funding required to finance the redemption of the 2014 ZDP Shares on 31 October 2014 through additional placings of the Offered ZDP Shares pursuant to the Initial Placing and/or Placing Programme or further portfolio realisations as appropriate.

 

The Rollover Offer

Under the Rollover Offer, holders of 2014 ZDP Shares are being given the opportunity to convert some or all of their holding of 2014 ZDP Shares (subject to the overall limits of the Rollover Offer) into new 2020 ZDP Shares. The Rollover Value attributed to the 2014 ZDP Shares will be 165.25p, a premium of 0.35 per cent. to their Accrued Capital Entitlement as at the Rollover Date. The Rollover Offer is limited to a maximum of 31 per cent. of the 2014 ZDP Shares in issue at the Record Date and each Qualifying Holder on the Register on the Record Date will be entitled to have accepted under the Rollover Offer his or her Basic Entitlement, which is equal to 31 per cent. of their holding of 2014 ZDP Shares as at the Record Date, subject to the Directors not exercising their discretion to scale back elections under the Rollover Offer as described below.

 

The rights attaching to the 2020 ZDP Shares will be substantially similar to those attaching to the 2014 ZDP Shares although no ZDP Shares will be issued at a price which has the effect of reducing the ZDP Cover for the 2020 ZDP Shares, at or around the time of the issue of such additional ZDP Shares, below 1.35x. In addition, subject to Rollover and Initial Placing Admission occurring, the 2020 ZDP Shares will have an illustrative initial capital entitlement on 31 July 2014 of 100p per 2020 ZDP Share and will have a Final Capital Entitlement of 154.90p per 2020 ZDP Share on 31 October 2020, the 2020 ZDP Repayment Date, equivalent to a Gross Redemption Yield of 7.25 per cent. per annum on the 2020 ZDP Share issue price.

 

As with the 2014 ZDP Shares, the 2020 ZDP Shares will not carry the right to vote at general meetings of Utilico or Utilico Finance but they will carry the right to vote as a class on certain proposals which would be likely to affect materially their position. The 2020 ZDP Shares will carry no entitlement to income and the whole of any return will therefore take the form of capital.

 

Subject to completion of the Rollover Offer, each 2014 ZDP Share validly elected to be rolled over will be converted into 1.6525 2020 ZDP Shares to be issued on the terms set out in the New Utilico Finance Bye- Laws. Fractions of 2020 ZDP Shares will not be issued. The number of 2020 ZDP Shares arising pursuant to an election under the Rollover Offer will be rounded down to the nearest whole number and any excess monies will be retained by Utilico Finance.

 

The Rollover Offer is open to all Qualifying Holders on the Register at the Record Date (such Qualifying Holders being Eligible Shareholders). All such persons shall be entitled to have accepted in the Rollover Offer valid elections in respect of his or her Basic Entitlement. In addition, Eligible Shareholders may make elections in excess of their Basic Entitlement but such excess elections will only be satisfied to the extent that other 2014 ZDP Shareholders have not made valid elections in respect of all or any part of their Basic Entitlement. Elections in excess of the Basic Entitlement will be satisfied pro rata in proportion to the excess over the Basic Entitlement elected, rounded down to the nearest whole number of 2014 ZDP Shares and subject to the exercise of the Directors' discretion to scale back elections under the Rollover Offer as described below.

 

In order to elect to participate in the Rollover Offer, 2014 ZDP Shareholders are advised to refer to the section entitled ''Action to be Taken'' on pages 29 and 30 of this document and to complete the Form of Election in accordance with the instructions printed thereon or submit a TTE Instruction through CREST, in each case in accordance with the instructions set out in this document.

 

Utilico Finance reserves the absolute right to inspect (either itself or through its agents) all Forms of Election and may consider void and reject any Form of Election that does not in the Board's sole judgement (acting reasonably) meet the requirements of the Rollover Offer. Utilico Finance also reserves the absolute right to waive any defect or irregularity in relation to the acceptance of the Rollover Offer by Eligible Shareholders, including any Form of Election (in whole or in part) which is not entirely in order or which is received after the Closing Date, missing share certificate(s) and/or other document(s) of title or an indemnity acceptable to Utilico Finance in lieu thereof. None of Utilico Finance, Utilico, the Receiving Agent or any other person will be under any duty to give notification of any defects or irregularities in acceptances under the Rollover Offer or incur any liability for failure to give any such notification.

 

If a holder of 2014 ZDP Shares signs and returns a Form of Election but does not specify in Box 1 of the form how many 2014 ZDP Shares he wishes to elect to participate in the Rollover Offer he will be deemed to have elected to participate in respect of his Basic Entitlement.

 

The Rollover Offer is conditional on Rollover and Initial Placing Admission, and therefore subject to the satisfaction of Listing Rule 14.2.2 as to the number of 2020 ZDP Shares held in public hands as at

Admission. The Directors will have the discretion to scale back elections under the Rollover Offer otherwise than on a pro rata basis and whether or not such elections are in excess of a 2014 ZDP Shareholder's Basic Entitlement if the Directors consider this necessary to ensure that sufficient 2020 ZDP Shares are held in public hands so as to satisfy the Listing Rule requirement. Further, the Directors may exercise their discretion and scale back elections under the Rollover Offer and place 2020 ZDP Shares pursuant to the Initial Placing in order to satisfy the Listing Rule. The Rollover Offer is also conditional on the ZDP Cover of the 2020 ZDP Shares being not less than 1.35x, taking into account the relevant allotment. The Directors will therefore also have the discretion to scale back elections under the Rollover Offer if the Directors consider this necessary to satisfy the ZDP Cover requirement.

 

2014 ZDP Shareholders who are Overseas ZDP Shareholders and any other 2014 ZDP Shareholders who do not make a valid election to roll over all or part of their ZDP Shares on the Form of Election or submit a valid TTE Instruction, will be deemed to have declined the opportunity to participate in the Rollover Offer and will continue to hold their 2014 ZDP Shares, the rights attaching to which will be unaffected by the Proposals.

 

Mechanics of the Rollover Offer

The Rollover Offer will be effected by the conversion of those 2014 ZDP Shares that are validly elected and accepted to participate in the Rollover Offer into new 2020 ZDP Shares pursuant to the New Utilico Finance Bye-Laws.  The key points of the Rollover Offer are as follows:

 

Subject to completion of the Rollover Offer, each 2014 ZDP Share validly elected to be rolled over will automatically convert into 1.6525 2020 ZDP Shares on and subject to the terms and conditions set out in this document and the Form of Election.

 

Forthwith upon conversion, any certificates relating to 2014 ZDP Shares that converted into 2020 ZDP Shares pursuant to the Rollover Offer shall be cancelled and Utilico Finance shall issue to each such holder of former 2014 ZDP Shares new certificates in respect of the 2020 ZDP Shares which have arisen upon conversion unless such holder of former 2014 ZDP Shares elects to hold their 2020 ZDP Shares in uncertificated form.

 

The rights attaching to 2014 ZDP Shares that are not converted into 2020 ZDP Shares pursuant to the Rollover Offer will remain unchanged, with their ZDP Repayment Date being 31 October 2014 and a Final Capital Entitlement of 167.60 pence per share.

 

Conditions to the Rollover Offer

The Rollover Offer is conditional on:

·      ZDP Cover of the 2020 ZDP Shares being not less than 1.35x, taking into account the effect of the relevant allotment;

·      the Placing Agreement remaining in full force and effect and not having been terminated in accordance with its terms; and

·      Admission of the 2020 ZDP Shares issued pursuant to the Rollover Offer and, if applicable, the Initial Placing.

 

In circumstances in which these conditions are not fully met, the Rollover Offer will not take place and no 2014 ZDP Shares will be converted into 2020 ZDP Shares.

 

Announcement of the results of the Rollover Offer

The results of the Rollover Offer will be announced through a Regulatory Information Service on or around 28 July 2014. This announcement will include the number of 2020 ZDP Shares arising pursuant to the Rollover Offer, the number of 2014 ZDP Shares that have elected to take part and details of any scaling back in relation to elections in excess of the Basic Entitlement or where the Directors have exercised their discretion to scale back elections so as to satisfy the ZDP Cover condition or to enable Utilico Finance to satisfy the Listing Rule requirement as to the minimum number of 2020 ZDP Shares which must be held in public hands which is a condition to Admission.

 

 

Overseas ZDP Shareholders

In order to avoid any inadvertent breach of overseas securities laws, Overseas ZDP Shareholders shall be deemed to have elected to not participate in the Rollover Offer. Notwithstanding any other provision of this document, Utilico Finance reserves the right to permit any Overseas ZDP Shareholders to receive 2020 ZDP Shares under the Rollover Offer if the Directors, in their sole and absolute discretion, are satisfied at any time prior to the Closing Date that the transaction in question is exempt from, or not subject to, the legislation or regulations giving rise to the restrictions in question.

 

The Initial Placing

Under the Initial Placing, Utilico Finance is proposing to issue up to 25,000,000 2020 ZDP Shares, less the number of 2020 ZDP Shares issued pursuant to the Rollover Offer. Westhouse Securities has agreed under the Placing Agreement to use its reasonable endeavours to procure placees for 2020 ZDP Shares at the Initial Placing Price, which will be 100p per 2020 ZDP Share. No 2020 ZDP Shares will be issued pursuant to the Initial Placing where such issue would reduce the ZDP Cover of the 2020 ZDP Shares below 1.35x.

 

The Initial Placing will close at 11.00 a.m. on 25 July 2014 (or such later date, not being later than

31 August 2014, as the Company and Westhouse Securities may agree). If the Initial Placing is extended, the revised timetable will be notified via an RIS.

 

The Initial Placing is conditional, inter alia, on:

(i)        the Placing Agreement becoming wholly unconditional (save as to Rollover and Initial Placing Admission) and not having been terminated in accordance with its terms prior to Rollover and Initial Placing Admission;

(ii)       minimum Gross Proceeds (together with the value of any 2020 ZDP Shares issued pursuant to the Rollover Offer) equalling £750,000 by 11.00 a.m. on 25 July 2014; and

(iii)     Admission of the Initial Placing Shares occurring by 8.00 a.m. on 31 July 2014 (or such later date as the Company and Westhouse Securities may agree in writing, being not later than 8.00 a.m. on 31 August 2014). The Initial Placing is not being underwritten.

 

Utilico has indicated that it intends to subscribe for up to 10,000,000 2020 ZDP Shares which are available under the Initial Placing to the extent that such shares are not subscribed for by any other placees pursuant to the Initial Placing or issued pursuant to the Rollover Offer, subject to ensuring that the ZDP Cover of the 2020 ZDP Shares is not less than 1.35x or that sufficient 2020 ZDP Shares are held in public hands so as to satisfy the Listing Rule requirement at Rollover and Initial Placing Admission. Such shares will be held by Utilico for investment purposes in accordance with its investment policy.

 

Applications will be made to the Financial Conduct Authority and to the London Stock Exchange respectively for the 2020 ZDP Shares issued pursuant to the Rollover Offer and the Initial Placing to be admitted: (i) to the Official List (by way of a standard listing under Chapter 14 of the Listing Rules); and (ii) to the London Stock Exchange's main market for listed securities (together Rollover and Initial Placing Admission). It is expected that Rollover and Initial Placing Admissions will become effective and that unconditional dealings in such 2020 ZDP Shares will commence on the London Stock Exchange on 31 July 2014.

 

In the event that the aggregate applications under the Initial Placing were to exceed 25,000,000 2020 ZDP Shares, it would be necessary to scale back applications under the Initial Placing. In such an event, applications under the Initial Placing will be scaled back at the Directors' discretion (in consultation with Westhouse Securities) and thereafter no further commitments will be accepted and the Initial Placing will be closed.

 

In addition, it may also be necessary to scale back applications of 2020 ZDP Shares to ensure that, following the Initial Placing, either the ZDP Cover of the 2020 ZDP Shares is not less than 1.35x or that sufficient 2020 ZDP Shares are held in public hands so as to satisfy the Listing Rule requirement at Rollover and Initial Placing Admission.

 

The Placing Programme

Following the Initial Placing the Directors intend to implement the Placing Programme (although Placing ZDP Shares may be issued pursuant to the Placing Programme from 2 July 2014) which will close on 1 July 2015 (or any earlier date on which it is fully subscribed). Under the Placing Programme, Utilico Finance is proposing to issue up to 25,000,000 2020 ZDP Shares (less the number of 2020 ZDP Shares issued under the Rollover Offer and the Initial Placing) and up to 10,000,000 2016 ZDP Shares and up to 10,000,000 2018 ZDP Shares at the applicable Issue Price. There is no minimum or maximum number of Placing ZDP Shares that may be placed with any subscriber.

 

No Placing ZDP Shares will be issued pursuant to the Placing Programme at a discount to their Accrued Capital Entitlement at the time of the relevant allotment, nor where such issue would, in the case of 2020 ZDP Shares, reduce the ZDP Cover of the 2020 ZDP Shares below 1.35x or, in the case of 2016 ZDP Shares or 2018 ZDP Shares, reduce the ZDP Cover of the 2016 ZDP Shares and/or the 2018 ZDP Shares (as applicable) below 1.5x or the ZDP Cover of the 2020 ZDP Shares below 1.35x. Furthermore, it is the intention of the Directors that no 2020 ZDP Shares will be issued pursuant to the Placing Programme which would increase the number of 2020 ZDP Shares in issue above 10,000,000, unless the ZDP Cover of the 2020 ZDP Shares following such issue is above 1.5x.

 

The Directors reserve the right to close the Placing Programme at any time prior to 1 July 2015. Notification of any closure or extension will be made through a Regulatory Information Service.

 

The allotment of Placing ZDP Shares under the Placing Programme is at the discretion of the Directors. Allotments may take place at any time prior to the final closing date of 1 July 2015. In relation to allotments, an announcement will be released through a Regulatory Information Service, including details of the number and class of Placing ZDP Shares allotted and the Issue Price for the allotment. It is anticipated that dealings in any Placing ZDP Shares issued pursuant to the Placing Programme will commence three Business Days after their allotment. Whilst it is expected that all Placing ZDP Shares allotted under the Placing Programme will be issued as Depositary Interests in uncertificated form, if any Placing ZDP Shares are issued in certificated form it is expected that share certificates will be despatched within ten Business Days after the relevant allotment date.

 

In the event that the aggregate applications under the Placing Programme were to exceed 25,000,000 2020 ZDP Shares, 10,000,000 2016 ZDP Shares and/or 10,000,000 2018 ZDP Shares, it would be necessary to scale back applications under the Placing Programme. In such an event, applications under the Placing Programme will be scaled back at the Directors' discretion (in consultation with Westhouse Securities) and thereafter no further commitments will be accepted and the Placing Programme will be closed. In addition, it may also be necessary to scale back applications of Placing ZDP Shares to ensure that following each placing under the Placing Programme: (i) in the case of 2020 ZDP Shares, the ZDP Cover of the 2020 ZDP Shares is not less than 1.35x for 2020 ZDP Shares issued up to an aggregate amount of 10,000,000 2020 ZDP Shares in issue and 1.5x for any 2020 ZDP Shares issued above that amount or, in the case of 2016 ZDP Shares or 2018 ZDP Shares, the ZDP Cover of ZDP Shares is not less than 1.5x and the ZDP Cover of the 2020 ZDP Shares is not less than 1.35x; and/ or (ii) sufficient ZDP Shares of each class are held in public hands so as to satisfy the Listing Rule requirement at the relevant Admission of the 2016 ZDP Shares and/or the 2018 ZDP Shares (as applicable).

 

The Placing Programme is not being underwritten and, as at the date of this document, the actual number and class of Placing ZDP Shares, if any, to be issued under the Placing Programme is not known. The number of Placing ZDP Shares available under the Placing Programme should not be taken as an indication of the number of Placing ZDP Shares finally to be issued.

 

The net proceeds of the Placing Programme is dependent on the subscriptions received, the number of 2020 ZDP Shares issued pursuant to the Rollover Offer and Initial Placing, the class of Placing ZDP Shares issued and the Issue Price at which such Placing ZDP Shares are issued under each placing. Assuming that the Initial Placing is fully subscribed and that gross proceeds of the Placing Programme equal £30.4 million, the net proceeds of the Placing Programme would be approximately £30.1 million with expenses (including any commission) of approximately £0.3 million. These expenses will be met out of the gross proceeds of the Placing Programme.

 

So far as the Directors are aware as at the date of this document, no major Shareholders or members of the Company's management, supervisory or administrative bodies intend to make a commitment for Placing ZDP Shares under the Placing Programme.

 

The Placing ZDP Shares issued under the Placing Programme will rank pari passu with the relevant class of ZDP Shares then in issue and will carry no entitlement to income, therefore the whole of any return will take the form of capital.

 

The Placing Programme will be suspended at any time when Utilico Finance is unable to issue Placing ZDP Shares pursuant to the Placing Programme under any statutory provision or other regulation applicable to the Company or Utilico Finance or otherwise at the Directors' discretion.

 

Westhouse Securities will be entitled to a commission payable by the Company in connection with the issue of the Placing ZDP Shares arising under the Rollover Offer and in respect of the gross proceeds of the Initial Placing and the Placing Programme. No commissions will be payable by the Company to placees under the Initial Placing and the Placing Programme.

 

Conditions to each allotment of Placing ZDP Shares under the Placing Programme

Each allotment of Placing ZDP Shares under the Placing Programme is conditional on:

·      in the case of the proposed issue of: (i) 2020 ZDP Shares, the ZDP Cover of the 2020 ZDP Shares being not less than 1.35x; (ii) 2016 ZDP Shares, the ZDP Cover of the 2016 ZDP Shares and the 2018 ZDP Shares being not less than 1.5x and the ZDP Cover of the 2020 ZDP Shares being not less than 1.35x; and (iii) 2018 ZDP Shares, the ZDP Cover of the 2018 ZDP Shares being not less than 1.5x and the ZDP Cover of the 2020 ZDP Shares being not less than 1.35x, in each case taking into account the effect of the relevant allotment; and

·      Admission of the Placing ZDP Shares issued pursuant to such allotment.

 

In circumstances in which these conditions are not fully met, the relevant issue of Placing ZDP Shares pursuant to the Placing Programme will not take place.

 

The Placing Programme price

The minimum price at which each new Placing ZDP Share will be issued under the Placing Programme will be the Accrued Capital Entitlement of the relevant class of ZDP Share at the date of allotment. The maximum price in respect of any allotment of Placing ZDP Shares will be equal to the best offer price of the relevant class of ZDP Share, as quoted on the London Stock Exchange at the time that the proposed allotment is agreed.

 

For these purposes, the Accrued Capital Entitlement will be calculated in accordance with the Utilico Finance Bye-Laws.

 

Holders of Ordinary Shares issued by Utilico will not suffer any dilution of their voting rights as a result of the Placing as ZDP Shares do not carry voting rights save in very limited circumstances. Holders of 2020 ZDP Shares arising pursuant to the Rollover Offer will have their voting rights at class meetings of the 2020 ZDP Shares diluted when new 2020 ZDP Shares are issued pursuant to the Placing Programme.

 

Illustrative financial effects of the Proposals

By way of illustration and based upon the Assumptions (with the exception of the assumption that the ZDP Cover levels are sufficient to allow the maximum number of 2016 ZDP Shares and 2018 ZDP Shares to be issued), had the Rollover Offer, the Initial Placing and Placing Programme taken place (and been taken up in full) at the date of this document, the Group's Gross Assets would have been increased by the estimated gross proceeds of the Placing Programme of £30.4 million, adjusted for all expenses in relation to the Proposals estimated to be approximately £0.8 million.

 

By way of illustration and based upon the Assumptions, if pursuant to the Rollover Offer 10,000,000 new 2020 ZDP Shares arise on the conversion of the 2014 ZDP Shares, the illustrative ZDP Cover following such rollover for the 2014 ZDP Shares, the 2016 ZDP Shares, the 2018 ZDP Shares and the 2020 ZDP Shares would be 4.41x, 2.21x, 1.54x and 1.46x respectively.

 

By way of illustration and based upon the Assumptions, if, no 2020 ZDP Shares are issued pursuant to Rollover Offer but 10,000,000 2020 ZDP Shares are issued pursuant to the Initial Placing at a price of 100p per share, the illustrative ZDP Cover for the 2014 ZDP Shares, the 2016 ZDP Shares, the 2018 ZDP Shares and the 2020 ZDP Shares following completion of the Initial Placing would be 4.41x, 2.21x, 1.54x and 1.46x respectively.

 

This statement is unaudited and is solely for illustrative purposes only, represents a hypothetical situation and, therefore, does not reflect the Group's actual financial position or results.

 

Costs of the Proposals

The expenses of the Group incurred in connection with the Proposals (and based upon the Assumptions) are estimated to be approximately £0.4 million.

 

Use of proceeds

The gross proceeds of the Initial Placing and the Placing Programme will be paid to Utilico for investment to continue to further diversify its portfolio in accordance with its investment policy.

 

Admission and Dealings

Applications will be made to the Financial Conduct Authority and to the London Stock Exchange respectively for the 2020 ZDP Shares issued pursuant to the Rollover Offer and the Initial Placing to be admitted: (i) to the Official List (by way of a standard listing under Chapter 14 of the Listing Rules); and (ii) to the London Stock Exchange's main market for listed securities. It is expected that Rollover and Initial Placing Admission will become effective and that unconditional dealings in such 2020 ZDP Shares will commence on the London Stock Exchange on 31 July 2014.

 

Applications will be made to the Financial Conduct Authority and to the London Stock Exchange respectively for the Placing ZDP Shares issued pursuant to the Placing Programme to be admitted: (i) to the Official List (by way of a standard listing under Chapter 14 of the Listing Rules); and (ii) to the London Stock Exchange's main market for listed securities. It is expected that such Subsequent Admissions will become effective and that unconditional dealings in such Placing ZDP Shares will commence on the London Stock Exchange during the period from 2 July 2014 to 1 July 2015.

 

All allotments of Offered ZDP Shares will be conditional on Admission of such Offered ZDP Shares. The timing of the applications for Admission and their approval pursuant to the Placing Programme are not known as at the date of this document but no Placing ZDP Shares will be issued if they will not be so admitted. This document has been published in order to obtain Admission to a standard listing on the Official List of any 2020 ZDP Shares arising pursuant to the Rollover Offer or issued under the Initial Placing or any other Offered ZDP Shares issued under the Placing Programme. No application will be made for the Offered ZDP Shares to be listed or dealt in on any stock exchange or investment exchange other than the London Stock Exchange.

 

The Offered ZDP Shares arising pursuant to the Rollover Offer and to be issued pursuant to the Initial Placing and the Placing Programme will be in registered form and may be held either in certificated form or as Depositary Interests in uncertificated form and settled through CREST.

 

CREST is a computerised paperless settlements system, which allows securities to be transferred via electronic means, without the need for a written instrument of transfer. Foreign securities cannot be held or traded in the CREST system. To enable investors to settle their Offered ZDP Shares through CREST, the Depositary will hold the relevant Offered ZDP Shares and will issue dematerialised Depositary Interests representing the underlying Offered ZDP Shares to the relevant investors. Dealings in the Offered ZDP Shares in advance of the crediting of the relevant Depositary Interests acquired shall be at the risk of the person concerned.

 

The Depositary will hold the Offered ZDP Shares on trust for the respective underlying Offered ZDP Shareholders. This trust relationship is documented in a deed executed by the Depositary. The Depositary Interests are independent, English securities and are held on a register maintained by the Registrars. The Depositary Interests have the same security code as the Offered ZDP Shares that they represent and do not require a separate admission to the London Stock Exchange.

 

Shareholders wishing to settle Offered ZDP Shares through CREST can transfer their holding to the

Depositary, which will then issue Depositary Interests representing the relevant transferred Offered ZDP Shares. The Depositary Interest holder will not hold a certificate evidencing the underlying Offered ZDP Share. Depositary Interests are issued on a one for one basis against the relevant Offered ZDP Shares that they represent for all purposes. Any payments received by the Depositary will be passed on to each Depositary Interest holder noted on the Depositary Interest register as the beneficial owner of the relevant Offered ZDP Shares.

 

Participation in CREST is voluntary and Shareholders who wish to hold Offered ZDP Shares outside of CREST will be entered on the Jersey branch register and issued with a share certificate evidencing ownership.

 

Application will be made by the Depositary for Depositary Interests representing the Offered ZDP Shares to be admitted to CREST on Admission.

 

Investors should be aware that Offered ZDP Shares delivered in certificated form are likely to incur, on an ongoing basis, higher dealing costs than those Offered ZDP Shares held through CREST. Shares initially issued in certificated form may subsequently be exchanged for Depositary Interests, which can be deposited into CREST in accordance with the procedure described above. Certificates in respect of 2020 ZDP Shares arising under the Rollover Offer and the Initial Placing and held in certificated form are expected to be despatched on 1 August 2014 or as soon as practicable thereafter.

 

Temporary documents of title will not be issued pending the delivery of 2020 ZDP Shares to the persons entitled thereto and, during that period, transfers will be certified against the register of 2020 ZDP Shareholders.

 

Directors' opinion

As the Proposals do not require the approval of ZDP Shareholders, the Directors are not required to make a recommendation as to how voting rights should be exercised. The Directors do, however, consider that the Proposals are in the best interests of Utilico Finance and the ZDP Shareholders as a whole.

 

Yours faithfully

Roger Urwin

Chairman"

 

 

Issue Statistics

 

2020 ZDP Share issue price and Initial Placing Price

100p

Initial Capital Entitlement per 2020 ZDP Share

100p

Final Capital Entitlement per 2020 ZDP Share

154.90p

Gross Redemption Yield at 2020 ZDP Share issue price

7.25%

2020 ZDP Cover following the Rollover Offer and Initial Placing*

1.46x

Maximum size of Initial Placing and the Placing Programme

25,000,000 2020 ZDP Shares,

10,000,000 2016 ZDP Shares

and 10,000,000 2018 ZDP Shares**

Issue Price under the Placing Programme

not less than the Accrued Capital

Entitlement of the relevant class

of ZDP Shares at the time of

allotment***

 

* Assuming that an aggregate of 10,000,000 2020 ZDP Shares are issued.

** The number of 2020 ZDP Shares available under the Initial Placing and Placing Programme will be reduced to the extent that 2020 ZDP Shares are taken up under the Rollover Offer and, in the case of the Placing Programme, issued under the Initial Placing.

*** The maximum Issue Price will be equal to the best offer price per relevant class of ZDP Shares at the time the proposed allotment is agreed.

 

 

 

 

 

 

Expected Timetable

 

Prospectus published

2 July 2014

Placing Programme opens

2 July 2014

Latest time for receipt of Forms of Election and TTE Instructions in connection with the Rollover Offer

3.00 p.m. 18 July 2014

Record Date for the Rollover Offer

5.00 p.m. on 18 July 2014

Latest time and date for receipt of placing commitments under the Initial Placing of 2020 ZDP Shares

11.00 a.m. 25 July 2014

Announcement of the result of the Rollover Offer and Initial Placing of 2020 ZDP Shares

28 July 2014

Admission of 2020 ZDP Shares issued pursuant to the Rollover Offer and Initial Placing to the Official List and dealings commence on the

London Stock Exchange

31 July 2014

Placing Programme closes

1 July 2015

 

 

 

 For further information please contact:

 

ICM Limited

Charles Jillings                                                                                           01372 271486

 

Westhouse Securities Limited

Alastair Moreton/Hannah Young/Darren Vickers                      0207 601 6118

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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