TIDMITM
RNS Number : 6317O
ITM Power PLC
03 October 2019
The information contained in this announcement is inside
information for the purposes of article 7 of Regulation (EU)
596/2014.
NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF
AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF
THE UNITED STATES AND THE DISTRICT OF COLUMBIA) (THE UNITED
STATES), AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA,
THE REPUBLIC OF IRELAND OR ANY OTHER JURISDICTION WHERE IT IS
UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.
3 October 2019
ITM POWER PLC
Total fundraising of at least GBP52m
(i) a strategic investment of GBP38m by Linde
(ii) a proposed Firm Placing of GBP14m, and
(iii) an Open Offer of up to cGBP6.8m,
each at 40 pence per share
Entry into new 50/50 Joint Venture with Linde AG
ITM Power plc (AIM: ITM) (ITM Power or the Group) is pleased to
announce its intention to raise at least GBP52.0 million (before
expenses) through (i) a strategic investment of GBP38.0 million at
40 pence per share by Linde UK Holdings No. 2 Limited, a member of
the Linde AG group (Linde) (the Share Subscription); and (ii) a
conditional placing of GBP14.0 million at 40 pence per share (the
Firm Placed Shares) with certain existing and new institutional
investors (the Firm Placing).
The Group has also entered into a 50/50 joint venture with Linde
(the Joint Venture) which will focus on delivering green hydrogen
to large scale industrial projects, principally those with an
installed electrolyser capacity of 10 Megawatts ("MW") and
above.
In addition to the Firm Placing and the Share Subscription, the
Group intends to raise up to c.GBP6.8 million through an Open Offer
(the Open Offer) of 17,053,126 New Ordinary Shares at 40 pence per
share (the Open Offer Shares).
The net proceeds of the fundraising will be used principally to
enhance the manufacturing capabilities of the Group, particularly
for the development and production of large scale 5MW
electrolysers, to facilitate product standardisation and
manufacturing cost reduction, to fund its initial financial
contribution to the Joint Venture, and provide working capital and
balance sheet strength to support the delivery of the contract
backlog and opportunity pipeline.
The Group has also today published its results for the year
ended 30 April 2019 in a separate announcement.
Highlights of the conditional Share Subscription, the Firm
Placing, the Open Offer and Joint Venture
-- ITM Power intends to raise a minimum of GBP52.0 million
pursuant to the conditional Share Subscription, the Firm Placing
and the Open Offer at a price of 40 pence per New Ordinary Share
(the Issue Price).
-- Strategic investment of GBP38.0m by Linde, a world leader in
industrial gases and engineering, via a Share Subscription for
95,000,000 New Ordinary Shares at the Issue price. On completion,
Linde will hold approximately 20% of the Group's enlarged share
capital.
-- Formation of the Joint Venture alongside Linde's strategic
investment. The Joint Venture will focus on delivering green
hydrogen to large scale industrial projects (generally being
opportunities with installed electrolyser capacities of 10
Megawatts and above).
-- It is intended that Linde will appoint a Non-Executive
Director to the Board of ITM Power following completion of the
Share Subscription.
-- The Issue Price represents a discount of approximately 7.0
per cent to the closing mid-market price of an Existing Ordinary
Share on 2 October 2019, being the latest practicable date prior to
the publication of this announcement.
-- The Firm Placing is being conducted, subject to the
satisfaction of certain conditions, on ITM Power's behalf by
Investec Bank plc (Investec). The Firm Placing and the Open Offer
are not being underwritten by Investec.
-- The Share Subscription, the Firm Placing and the Open Offer
are inter-conditional. In particular, they are conditional on
(amongst other things): (i) the passing by the requisite majority
of Shareholders of resolutions to grant authorities to Directors to
allot further shares for cash on a non-pre-emptive basis; and (ii)
admission of the New Ordinary Shares to trading on AIM on or before
8.00 a.m. on 23 October 2019 (or such later time and/or date as may
be agreed between the Group and Investec) (Admission).
-- The net proceeds of the Share Subscription, the Firm Placing
and the Open Offer (expected to be a minimum of approximately
GBP50.8 million) will be utilised by the Group to facilitate the
Group's move to its new, larger Bessemer Park facility in Sheffield
with an annual production capacity of over 1000 MW per annum, fund
and resource development of a 5MW electrolyser module, enhance
product standardisation, meet initial funding requirements for the
Joint Venture and to provide working capital to support (among
other things) the delivery of the contract backlog and opportunity
pipeline and to strengthen the Group's balance sheet.
The Group announced its final results for the year to 30 April
2019 on 3 October 2019. A copy of the final results will be
available on the Group's website at www.itm-power.com.
The Group expects to publish a circular in connection with the
Firm Placing, the Open Offer and the Share Subscription in the
coming days. Shareholders should read the Circular and the Group's
full year results in full before making any application for Open
Offer Shares.
Graham Cooley, Chief Executive Officer of ITM Power plc,
said:
"The major strategic investment from Linde cements a five year
relationship between us and provides ITM Power with a world leading
partner that brings deep expertise in engineering, procurement and
construction and a global customer base. The joint venture will
enable us to focus on our core competency of the development and
sale of electrolysers, and with Linde as our partner to deliver
green hydrogen at scale, The successful fundraising provides the
financial resources to exploit this exciting opportunity to the
full.
"We are seeing increasing global demand for hydrogen as a
solution to renewable energy storage needs and the decarbonisation
of major industrial processes. The fundraising and our partnership
with Linde will help us to meet this demand on a growing scale,
deliver efficiencies throughout our supply chain and represents a
significant step on our pathway to medium-term profitability"
Enquiries:
+44 (0)114 244
ITM Power plc 5111
Graham Cooley, CEO
Investec Bank plc (Nominated Adviser, Financial
Adviser and Broker) +44 (0)20 75974000
Jeremy Ellis / Chris Sim / Ben Griffiths /
Tejas Padalkar
+44 (0)20 7920
Tavistock (Financial PR and IR) 3150
Simon Hudson / Nick Elwes / Barney Hayward
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Record Date for entitlement to participate 5.00 p.m. on 2 October
in the Open Offer 2019
Announcement of the Firm Placing, the
Share Subscription and the Open Offer 3 October 2019
Dispatch of the Circular, the Form of
Proxy and, to certain qualifying Non-CREST
Shareholders, the Application Form 4 October 2019
Expected ex-entitlement date for the 8.00 a.m. on 3 October
Open Offer 2019
Basic Entitlements and Excess CREST
Open Offer Entitlements credited to
CREST stock accounts of Qualifying CREST
Shareholders 7 October 2019
Recommended latest time and date for
requesting withdrawal of Basic Entitlements
and Excess CREST Open Offer Entitlements 4.30 p.m. on 15 October
from CREST 2019
Latest time for depositing Basic Entitlements
and Excess CREST Open Offer Entitlements 3.00 p.m. on 16 October
into CREST 2019
Latest time and date for splitting Application
Forms (to satisfy bona fide market claims 3.00 p.m. on 17 October
only) 2019
Latest time and date for receipt of 11.00 a.m. on 18 October
Forms of Proxy for the General Meeting 2019
Latest time and date for receipt of
completed Application Forms and payment
in full under the Open Offer or settlement 11.00 a.m. on 21 October
of relevant CREST instruction (as appropriate) 2019
11.00 a.m. on 22 October
General Meeting 2019
Result of Open Offer announced through
RNS 22 October 2019
Admission of the New Ordinary Shares 8.00 a.m. on 23 October
to trading on AIM 2019
New Ordinary Shares in uncertificated As soon as practicable
form expected to be credited to accounts after 8.00 a.m. on 23
in CREST (uncertificated holders only) October 2019
Expected date of dispatch of definitive
share certificates for the New Ordinary
Shares in certificated form (certificated
holders only) on 1 November 2019
Background to and reasons for the Firm Placing, Share
Subscription, the Open Offer and use of proceeds
The Group is seeing a considerable expansion in each of its
end-markets. This is being driven by the improving economics and
output of renewable power generation, alongside the growing
commercial and regulatory focus on decarbonisation of energy
intensive industrial processes. These trends are driving an
increasing demand for the provision of green hydrogen at scale and
the Group is in discussions over a number of proposals to deliver
projects of 100 Megawatts and above, particularly in the power to
gas and renewable chemistry markets.
Linde Minority Share Investment into ITM Power and Joint Venture
between ITM Power and Linde
The Group has entered into an agreement with Linde to establish
a 50/50 Joint Venture through the formation of a new vehicle. The
objective of the Joint Venture is to enable the acceleration of
large scale green hydrogen plant construction.
Linde is a leading industrial gases and engineering company with
2018 pro forma sales of USD 28 billion (EUR 24 billion). The
company employs approximately 80,000 people globally and serves
customers in more than 100 countries worldwide.
The Directors expect Linde's size and global reach to
significantly increase the ability of the Group to offer
cost-competitive electrolysis products and systems in key markets,
as well as to provide new opportunities through the Joint Venture's
access to Linde's global customer base, and project delivery
expertise. It is expected that these factors will materially
increase the Group's volume of electrolyser sales. This is a key
driver in the Group's ambition to continue the cost reduction and
increase competitiveness.
The Group and Linde have enjoyed for several years a successful
collaboration on hydrogen projects and the Joint Venture is
believed by the Directors to represent an important step in the
Group's development of the business and significantly enhancing the
Group's capability to offer and efficiently deliver electrolysers
for large-scale projects.
With the Joint Venture, the Group and Linde plan to primarily
serve the refinery market, among others, with electrolysis-based
hydrogen and green gases solutions, and jointly offer to customers
feasibility studies, project development and EPC services. The
Group will contribute with its electrolysis competences and
supplies, and Linde will contribute with its proprietary
technologies for gas separation and gas processing and its global
project realization competencies.
The Directors believe that by combining Linde's world-leading
experience with the Group's continued developments in delivery of
PEM electrolyser technology at increasing scale with the Joint
Venture, the Group will be uniquely placed to deliver large-scale
and complex gas production projects to industrial customers. In
particular the Joint Venture will enable the Group and Linde to
combine ITM Power's expertise in Polymer Electrolyte Membrane
("PEM") electrolysis with Linde's successful global project
realization experience in gases production and processing
facilities. The Joint Venture is expected to significantly increase
the ability of the Group to access complex large-scale projects and
solutions with its electrolysis technology, which require project
delivery and site integration.
Through the Joint Venture, the Group is expected to be in an
improved position to accelerate the process of converting
large-scale opportunities into sales, as well as to reduce project
lead times and improve execution through dedicated and experienced
resources across both electrolysis and project delivery / site
integration requirements. The increased manufacturing capacity of
the Group, together with Linde's engineering, procurement and
construction management resources through the Joint Venture, is
expected to further increase the volume of projects which can be
delivered in parallel, driving an associated cost reduction which
is expected to increase the Group's competitiveness.
Under the terms of the agreement, the Joint Venture will see an
innovation management council created with equal representation
from both ITM Power and Linde, with the target to determine
measures to enhance the value propositions and competitive edge.
The Joint Venture will be set up to include personnel from both
organisations to leverage the depth of expertise from both the
Group and Linde.
Move to Bessemer Park
The Group has an agreement for lease on a new 134,000 square
foot facility at Bessemer Park in Sheffield. The facility is
currently being developed in line with the Group's requirements and
is expected to have an annual production capacity sufficient for
the manufacture of over 1000 MW of electrolysers per annum, making
the facility the world's largest PEM electrolyser manufacturing
plant currently in development.
The facility is intended to be used for product assembly, stack
manufacturing and development and testing of the Group's proposed
5MW stack module and will address capacity constraints that the
Group currently experiences in its existing facilities, including
limited power sources. The Bessemer Park site will also have a
marketing area and office space for more than 100 employees.
Current expectations are that occupation of administrative offices
will commence in Spring 2020 and that manufacturing will commence
in the summer of 2020.
The Directors expect the move to Bessemer Park will facilitate a
number of advantages in addition to the increased manufacturing
capacity, including semi-automation of manufacturing processes and
a larger 5MW grid connection, to contribute to the Group's strategy
of delivering increased system sizes for larger projects.
Continued Product Development
The Directors' immediate objective in terms of product
development is to continue to focus on the scale up of proven
electrolysis equipment, targeting penetration of larger markets.
The Directors believe this approach to be a direct response to
market demand from sales enquiries, trade fairs and marketing
events and the large scale tender opportunities presenting in the
market at present. To achieve this, the Group is pursuing the
development of a 5MW 2-stack module which is scaleable for those
projects of up to and beyond 100MW capacity that are increasingly
being tendered. Product development, and in particular upscaling of
product offering, is further supported through the Group's
participation in large-scale feasibility studies, such as the 100MW
Centurion project and the Gigastack feasibility study with
Orsted.
The Group's provisional specifications for the 5MW module
indicate that it will be capable of generating 2.1 tonnes of
hydrogen per day, and the Group's current internal development
timetable anticipates that first hydrogen from a 5MW module will be
generated in the final quarter of 2020. The design of the 5MW
module is intended to improve design integration techniques in
order to reduce balance of plant costs on larger projects, and is
further indicative of the Group's drive for continuous product
improvement and cost reduction.
Cash Position and Requirements
As at 30 April 2019, the Group reported total financial assets
of cGBP19.8m, of which cGBP5.2m is cash, cGBP1.7m is cash on
guarantee and the remaining GBP12.9m is deployed working capital
(debtors less creditors).
To manage working capital demands and to mitigate the impact of
existing projects with cash receipts towards the end of the
contractual agreement, the Group is seeking a move towards quoting
for potential sales with upfront payment terms, thus reducing the
initial working capital outlay of such commercial projects. On
certain projects, working capital is also enhanced through working
with, and receiving support from, partners on the development of
technology.
Cash flow remains a key consideration for the Board, and the
presiding financial objective for the Group is the achievement of a
positive cash flow in the medium term.
Use of Proceeds
The Directors intend to use the proceeds of the Firm Placing,
the Open Offer and the Share Subscription to:
-- facilitate the Group's move to new larger facilities at
Bessemer Park in Sheffield, which will consolidate the Group's two
current sites and is expected to facilitate annual production
capacity of over 1000MW. This would include installation of an
enlarged grid connection with a capacity of 5MW, in order to be
able to test larger scale electrolysers, as well as development of
semi-automated manufacturing processes to enable cost
reduction;
-- fund and resource the Group's development of a 5MW
electrolyser module, which is seen by the Directors as a key
opportunity to increase the scale of projects which the Group is
capable of delivering on a competitive basis, along with further
product development focusing on the delivery of electrolyser
systems;
-- to meet requirements for the funding of the Joint Venture
referred to above, which is expected to be an initial GBP2million;
and
-- provide working capital to support (among other things) the
delivery of the contract backlog and opportunity pipeline, to
strengthen the Group's balance sheet, to assist in meeting tender
requirements and to improve contractual terms offered by customers
and suppliers, in particular with regard to obtaining improved
upfront payment terms from customers and suppliers;
Backlog and Pipeline
As at the beginning of September 2019, the Group had c.GBP17.1
million of existing projects under contract and a further c.GBP16.1
million in the later stages of negotiation (c.GBP33.2 million in
total). In addition, the Group has a qualified opportunity pipeline
of c.GBP379 million of commercial sales, which consists of over 50
separate projects, across all three end markets, Renewable
Chemistry, Power-to-Gas Storage and Clean Fuel.
For each of the projects qualified within this figure, the Group
has been engaged to provide a written proposal within the past 12
months, the client is understood to remain actively interested in
pursuing the project, and the Directors believe the client has the
financial means and the ambition to implement the project in the
medium term. The majority of these projects, both under contract or
negotiation and in the qualified pipeline, provide for a portion of
the project cost to be paid by the client to the relevant member of
the Group up front, with the corresponding balance of the income
typically received towards the end of the contract. This results in
a working capital shortfall during the middle and later stages of
the contract term, when cash is used in the build phase as well as
final commissioning and user testing. The Board is also of the
opinion that to bid effectively for the increasing number of larger
scale projects it is important that the Group can demonstrate a
robust balance sheet and financial condition.
Details of the Firm Placing, the Open Offer and the Share
Subscription
Structure
The Directors have given careful consideration as to the
structure of the proposed fundraising and have concluded that the
Firm Placing, the Open Offer and the Share Subscription is the most
suitable option available to the Group and its Shareholders at this
time.
It is intended that 35,000,000 Firm Placed Shares will be issued
through the Firm Placing at 40 pence per New Ordinary Share to
raise gross proceeds of GBP14.0 million. Up to 17,053,126 New
Ordinary Shares will be issued through the Open Offer at 40 pence
per New Ordinary Share to raise gross proceeds of up to
approximately GBP6.8 million.
Principal terms of the Firm Placing
The Group is proposing to issue 35,000,000 Firm Placed Shares
pursuant to the Firm Placing. In accordance with the terms of the
Firm Placing and Open Offer Agreement, Investec has agreed to use
reasonable endeavours to procure placees for the Firm Placing
Shares at the Placing Price.
The Firm Placing is not being underwritten.
Dr. Graham Cooley, Robert Putnam, Sir Roger Bone and Martin
Green have undertaken to subscribe for, in aggregate, 265,000 Firm
Placed Shares in the Firm Placing at a price of 40 pence per New
Ordinary Share, as set out below.
The Firm Placed Shares are not subject to clawback and are not
part of the Open Offer.
Under the Firm Placing and Open Offer Agreement, the Group has
agreed to pay to Investec a fixed sum together with a commission
based on the aggregate value of certain of the Firm Placed Shares
placed at the Issue Price and the costs and expenses of the Firm
Placing together with any applicable VAT.
Principal terms of the Open Offer
The Board considers it important that Qualifying Shareholders
have the opportunity to participate in the fundraising, and the
Directors have concluded that the Open Offer is the most suitable
option available to the Group and its Shareholders.
The Open Offer provides an opportunity for all Qualifying
Shareholders to participate in the fundraising by both subscribing
for their respective Basic Entitlements and by subscribing for
Excess Shares under the Excess Application Facility, subject to
availability.
Pursuant to the Open Offer, Qualifying Shareholders will be
given the opportunity to subscribe for 1 Open Offer Share for every
19 Existing Ordinary Shares held on the Record Date.
The Open Offer will raise gross proceeds of up to approximately
GBP6.8 million.
The Issue Price represents a 7.0 per cent. discount to the
Closing Price of 43 pence per Ordinary Share on the Latest
Practicable Date.
Basic Entitlement
Qualifying Shareholders will be invited, on and subject to the
terms and conditions of the Open Offer, to apply for any number of
Open Offer Shares (subject to the limit on the number of Excess
Shares that can be applied for using the Excess Application
Facility) at the Issue Price. Qualifying Shareholders have a Basic
Entitlement of:
1 Open Offer Share for every 19 Existing Ordinary Shares
registered in the name of the relevant Qualifying Shareholder on
the Record Date.
Basic Entitlements under the Open Offer will be rounded down to
the nearest whole number and any fractional entitlements to Open
Offer Shares will be disregarded in calculating Basic Entitlements
and will be aggregated and made available to Qualifying
Shareholders under the Excess Application Facility.
The aggregate number of Open Offer Shares available for
subscription pursuant to the Open Offer will not exceed 17,053,126
New Ordinary Shares.
Principal terms of the conditional Share Subscription
Pursuant to a subscription agreement dated on or about the date
of this announcement, Linde UK Holdings No.2 Limited has agreed to
subscribe for 95,000,000 New Ordinary Shares at a price of 40 pence
per New Ordinary Share, raising GBP38.0m before expenses. The Share
Subscription is conditional on (amongst other things):
(a) the Firm Placing and Open Offer Agreement having not lapsed
or been terminated in accordance with its terms and the Open Offer
Shares and the Firm Placed Shares having been admitted to trading
on AIM in accordance with the AIM Rules;
(b) the Group successfully raising, pursuant to the Share
Subscription, the Firm Placing and the Open Offer, an amount which
equals not less than GBP52,000,000 and not more than
GBP59,000,000;
(c) the New Ordinary Shares issued pursuant to the Share
Subscription representing not less than 20% of the Enlarged Share
Capital of the Group; and
(d) admission of the Subscription Shares occurring no later than
8.00 am on the date on which Admission occurs.
Pursuant to the Subscription Agreement:
(a) Linde will have the right, following completion of the Share
Subscription and for so long as it holds at least 10 per cent of
the issued ordinary share capital of the Group, to appoint a
non-executive director to the Board;
(b) following completion of the Share Subscription, the Group
will establish a technology management committee which will be
responsible for setting the direction of product innovation for the
Group, which committee will be chaired by the non-executive
director appointed by Linde; and
(c) Linde has agreed, other than in certain limited
circumstances, not to sell any of the Subscription Shares for a
period of 12 months following completion of the Share Subscription
or acquire shares which would increase Linde's shareholding to more
than 29.99% of the Group's issued ordinary share capital.
Conditionality
The Firm Placing, the Share Subscription and the Open Offer are
conditional, among other things, upon the following:
(a) the passing, without amendment, of the Resolutions at the General Meeting;
(b) Admission occurring by no later than 8.00 a.m. on 23 October
2019 (or such later time and/or date as may be agreed between the
Group and Investec, being no later than 8.00 a.m. on 1 November
2019); and
(c) the Firm Placing and Open Offer Agreement and the
Subscription Agreement becoming unconditional in all respects and
not having been terminated in accordance with their terms.
If the conditions set out above are not satisfied or waived
(where capable of waiver), the Firm Placing, the Share Subscription
and the Open Offer will lapse; and
(a) the Firm Placed Shares will not be issued and all monies
received from investors in respect of the Firm Placed Shares will
be returned to them (at the investors' risk and without interest)
as soon as possible thereafter; and
(b) any Basic Entitlements and Excess CREST Open Offer
Entitlements admitted to CREST will, after that time and date, be
disabled and application monies under the Open Offer will be
refunded to the applicants, by cheque (at the applicant's risk) in
the case of Qualifying Non-CREST Shareholders and by way of a CREST
payment in the case of Qualifying CREST Shareholders, without
interest, as soon as practicable thereafter.
Application for Admission
Application will be made to the London Stock Exchange for the
New Ordinary Shares to be admitted to trading on AIM. Admission is
expected to take place, and dealings on AIM are expected to
commence, at 8.00 a.m. on 23 October 2019 (or such later time
and/or date as may be agreed between the Group and Investec, being
no later than 8.00 a.m. on 1 November 2019). No temporary document
of title will be issued.
The New Ordinary Shares will, following Admission, rank pari
passu in all respects with the Existing Ordinary Shares and will
carry the right to receive all dividends and distributions
declared, made or paid on or in respect of the Ordinary Shares
after Admission.
Effect of the Firm Placing and the Open Offer
Upon completion of the Firm Placing, the Open Offer and the
Share Subscription, the New Ordinary Shares will represent
approximately 31.2 per cent. of the Enlarged Share Capital
(assuming the Open Offer is subscribed in full).
Total voting rights
Following Admission, the Group will have a total of 471,062,527
Ordinary Shares in issue (assuming the Open Offer is subscribed in
full). With effect from Admission, this figure may (assuming the
Open Offer is subscribed in full) be used by shareholders as the
denominator for the calculations by which they will determine if
they are required to notify their interest in, or a change to their
interest in the Group, under the Disclosure Guidance and
Transparency Rules of the Financial Conduct Authority.
Intentions of the Directors in relation to the Firm Placing
The following participants intend to subscribe for an aggregate
of 265,000 Firm Placed Shares as set out below:
Participant Number of Firm Placed Shares
Sir Roger Bone 125,000
Martin Green 40,000
Graham Cooley 75,000
Andy Allen 25,000
Irrevocable voting commitments from certain Directors
Directors, who in aggregate hold 1,691,182 Existing Ordinary
Shares, representing approximately 0.52% per cent. of the Existing
Issued Share Capital, have irrevocably undertaken to vote (and
where such Existing Ordinary Shares are registered in the name of
any other persons have irrevocably undertaken to use reasonable
endeavours to procure that those persons will vote) in favour of
the Resolutions at the General Meeting.
General Meeting and Circular to Shareholders
A General Meeting of the Group is planned to be held at 11.00
a.m. on 22 October 2019, at the offices of Burges Salmon LLP, 6 New
Street Square, London, EC4A 3BF. The General Meeting is being held
for the purpose of considering and, if thought fit, passing the
Resolutions in order to approve the Firm Placing, the Open Offer
and the Share Subscription.
A summary and explanation of the Resolutions will be set out in
the Circular to be sent out shortly.
Important information
This announcement is for information purposes only and does not
purport to be full or complete. No reliance may be placed for any
purpose on the information contained in this announcement or its
accuracy or completeness.
This announcement does not itself constitute an offer or
invitation to underwrite, subscribe for or otherwise acquire or
dispose of any securities in the Group and does not constitute
investment advice.
Neither this announcement nor any copy of it may be taken or
transmitted, published, distributed, reproduced or otherwise made
available, in whole or in part, directly or indirectly, for any
purpose whatsoever, into the United States, Australia, Canada,
Japan, the Republic of South Africa, the Republic of Ireland or to
any persons in any of those jurisdictions or any other jurisdiction
where to do so would constitute a violation of the relevant
securities laws of such jurisdiction. Any failure to comply with
this restriction may constitute a violation of United States,
Australian, Canadian, Japanese, South African or Irish securities
laws. The distribution of this announcement in other jurisdictions
may be restricted by law and persons into whose possession this
announcement comes should inform themselves about, and observe any
such restrictions. Any failure to comply with these restrictions
may constitute a violation of the laws of the relevant
jurisdiction.
This announcement does not constitute, or form part of, any
offer or invitation to sell or issue, or any solicitation of any
offer to purchase or subscribe for any Ordinary Shares or other
securities in the Group.
This announcement is restricted and may not be released,
published or distributed in the United States, Australia, Canada,
Japan, the Republic of South Africa, the Republic of Ireland or in
any jurisdiction to whom or in which such offer or solicitation is
unlawful. The Firm Placing, the Open Offer and the Share
Subscription and the distribution of this announcement and other
information in connection with the Firm Placing, the Open Offer and
the Share Subscription in certain jurisdictions may be restricted
by law and persons into whose possession this announcement, any
document or other information referred to herein, comes should
inform themselves about and observe any such restriction. Any
failure to comply with these restrictions may constitute a
violation of the securities laws of any such jurisdiction. Neither
this announcement nor any part of it nor the fact of its
distribution shall form the basis of or be relied on in connection
with or act as an inducement to enter into any contract or
commitment whatsoever.
In particular, the securities of the Group (including the Firm
Placed Shares, the Open Offer Shares and the Subscription Shares)
have not been and will not be registered under the US Securities
Act of 1933, as amended (the Securities Act), or under the
securities laws or with any securities regulatory authority of any
state or other jurisdiction of the United States, and accordingly
the Firm Placed Shares, the Open Offer Shares and the Subscription
Shares may not be offered, sold, pledged or transferred, directly
or indirectly, in, into or within the United States except pursuant
to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and the securities
laws of any relevant state or jurisdiction of the United States.
There is no intention to register any portion of the offering in
the United States or to conduct a public offering of securities in
the United States.
The Firm Placed Shares, the Open Offer Shares and the
Subscription Shares have not been approved or disapproved by the US
Securities and Exchange Commission, any state securities commission
or other regulatory authority in the United States, nor have any of
the foregoing authorities passed upon or endorsed the merits of the
Firm Placing, the Open Offer and the Share Subscription or the
accuracy or adequacy of this announcement. Any representation to
the contrary is a criminal offence in the United States.
Investec, which is authorised by the Prudential Regulation
Authority and regulated in the United Kingdom by the FCA and the
Prudential Regulation Authority, is acting as Nominated Adviser,
Financial Adviser and Broker to the Group in respect of the Firm
Placing. Investec is acting exclusively for the Group and for
no-one else in connection with the Firm Placing and the matters
referred to herein, and will not be treating any other person as
its client, in relation thereto and will not be responsible for
providing the regulatory protections afforded to its customers nor
for providing advice in connection with the Firm Placing or any
other matters referred to herein. Apart from the responsibilities
and liabilities (if any) imposed on Investec, as the case may be,
by the Financial Services and Markets Act 2000 (as amended) or any
regulatory regime established thereunder, Investec does not make
any representation express or implied in relation to, nor accepts
any responsibility whatsoever for, the contents of this
announcement, the Circular, or any other statement made or
purported to be made by it or on its behalf in connection with the
Group or the matters referred to herein. Investec (and its
affiliates) accordingly, to the fullest extent permissible by law,
disclaims any and all liability (save for statutory liability)
whether arising in tort, contract or otherwise which it might have
in respect of the contents of this this announcement or any other
statement made or purported to be made by it or on its behalf in
connection with the Group or the matters referred to herein. Any
other person in receipt of this announcement should seek their own
independent legal, investment and tax advice as they see fit.
All offers of the Firm Placed Shares, the Open Offer Shares and
the Subscription Shares in the EEA will be made pursuant to an
exemption under the Prospectus Regulation (2017/1129) from the
requirement to produce a prospectus.
Forward-looking statements
Certain information contained in this announcement constitute
forward looking information. This information relates to future
events or occurrences or the Group and/or the Group's future
performance. All information other than information of historical
fact is forward looking information. The use of any of the words
"anticipate", "plan", "continue", "estimate", "expect", "may",
"will", "project", "should", "believe", "predict" and "potential"
and similar expressions are intended to identify forward looking
information. This information involves known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such forward
looking information. No assurance can be given that this
information will prove to be correct and such forward looking
information included in this announcement should not be relied
upon. Forward-looking information speaks only as of the date of
this announcement.
The forward looking information included in this announcement is
expressly qualified by this cautionary statement and is made as of
the date of this announcement. The Group does not undertake any
obligation to publicly update or revise any forward looking
information except as required by applicable securities laws.
Information to distributors
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended (MiFID II); (b) Articles 9 and 10
of Commission Delegated Directive (EU) 2017/593 supplementing MiFID
II; and (c) local implementing measures (together, the MiFID II
Product Governance Requirements), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the Firm Placed Shares, the Open Offer Shares and the Subscription
Shares have been subject to a product approval process, which has
determined that the Firm Placed Shares, the Open Offer Shares and
the Subscription Shares are: (i) compatible with an end target
market of retail investors and investors who meet the criteria of
professional clients and eligible counterparties, each as defined
in MiFID II, who do not need a guaranteed income or capital
protection who (either alone or in conjunction with an appropriate
nancial or other adviser) are capable of evaluating the merits and
risks of such an investment and who have appropriate resources to
be able to bear any losses that may result therefrom; and (ii)
eligible for distribution through all distribution channels as are
permitted by MiFID II (the Target Market Assessment).
Notwithstanding the Target Market Assessment, distributors should
note that: the price of the Firm Placed Shares, the Open Offer
Shares and the Subscription Shares may decline and investors could
lose all or part of their investment; the Firm Placed Shares, the
Open Offer Shares and the Subscription Shares offer no guaranteed
income and no capital protection; and an investment in
the Firm Placed Shares, the Open Offer Shares and the
Subscription Shares is compatible only with investors who do not
need a guaranteed income or capital protection, who (either alone
or in conjunction with an appropriate financial or other adviser)
are capable of evaluating the merits and risks of such an
investment and who have appropriate resources to be able to bear
any losses that may result therefrom. The Target Market Assessment
is without prejudice to the requirements of any contractual, legal
or regulatory selling restrictions in relation to the Firm Placing,
the Open Offer and Share Subscription. Furthermore, it is noted
that, notwithstanding the Target Market Assessment Investec has
only procured investors who meet the criteria of professional
clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take
any other action whatsoever with respect to the Firm Placed Shares,
the Open Offer Shares and the Subscription Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Firm Placed Shares, the Open
Offer Shares and the Subscription Shares and determining
appropriate distribution channels.
DEFINITIONS
The following definitions apply throughout this announcement
unless the context otherwise requires:
Act the Companies Act 2006 (as amended);
Admission admission of the New Ordinary Shares to
trading on AIM and such admission becoming
effective in accordance with the AIM Rules;
AIM the AIM market operated by the London Stock
Exchange;
AIM Rules the AIM Rules for Companies and/or the AIM
Rules for Nominated Advisers (as the context
may require);
AIM Rules for Companies the rules of AIM as set out in the publication
entitled 'AIM Rules for Companies' published
by the London Stock Exchange from time to
time;
AIM Rules for Nominated the rules of AIM as set out in the publication
entitled 'AIM Rules for
Advisers Nominated Advisers' published by the London
Stock Exchange from time to time;
Application Form the application form to be used by Qualifying
Non-CREST Shareholders in connection with
the Open Offer and which will accompany
the Circular;
Basic Entitlement the Open Offer Shares which a Qualifying
Shareholder is entitled to subscribe for
under the Open Offer calculated on the basis
of 1 Open Offer Share for every 19 Existing
Ordinary Shares held by that Qualifying
Shareholder as at the Record Date;
Board or Directors the board of directors of the Company for
the time being;
certificated form the description of a share or other security
or which is not in uncertificated form
Circular the Circular to be published by the Group
following the date of this announcement
in connection with the Firm Placing, the
Open Offer and the Share Subscription, which
will contain (amongst other things) the
Notice of General Meeting
Closing Price the closing middle market quotation of an
Ordinary Share as derived from the AIM Appendix
to the Daily Official List of the London
Stock Exchange;
Group or ITM Power plc, a company incorporated in
England and Wales with
ITM Power plc registered number 05059407 and having its
registered office at 22 Atlas Way, Sheffield,
S4 7QQ;
CREST the relevant system (as defined in the CREST
Regulations) in respect of which Euroclear
is the Operator (as defined in the CREST
Regulations);
CREST Regulations the Uncertificated Securities Regulations
2001 (as amended);
Enlarged Share Capital the issued share capital of the Group immediately
following Admission, assuming (save for
the purposes of calculating the 29.9 per
cent. Aggregate Limit) the maximum number
of Open Offer Shares are allotted;
Euroclear Euroclear UK & Ireland Limited;
Excess Applications applications pursuant to the Excess Application
Facility;
Excess Application the mechanism whereby a Qualifying Shareholder,
Facility who has taken up his Basic Entitlement in
full, can apply for Excess Shares up to
an amount equal to the total number of Open
Offer Shares available under the Open Offer
less an amount equal to a Qualifying Shareholder's
Basic Entitlement, subject always to the
29.9 per cent. Aggregate Limit, in accordance
with the provisions to be set out in the
Circular;
Excess CREST Open in respect of each Qualifying CREST Shareholder
Offer Entitlements who has taken up his Basic Entitlement in
full, the entitlement to apply for Open
Offer Shares in addition to his Basic Entitlement
credited to his stock account in CREST,
pursuant to the Excess Application Facility,
which may be subject to scaling back in
accordance with the provisions to be set
out in the Circular;
Excess Shares Open Offer Shares which are not taken up
by Qualifying Shareholders pursuant to their
Basic Entitlement and which are offered
to Qualifying Shareholders under the Excess
Application Facility;
Excluded Overseas other than as agreed by the Group and Investec
Shareholders or as permitted by applicable law, Shareholders
who are located or have registered addresses
in a Restricted Jurisdiction;
Existing Issued the issued share capital of the Group as
Share Capital at the Latest Practicable Date;
Existing Ordinary the 324,009,400 Ordinary Shares in issue
Shares as at the Record Date;
FCA the UK Financial Conduct Authority;
Firm Placees the persons who have agreed to subscribe
for the Firm Placed Shares;
Firm Placed Shares the 35,000,000 New Ordinary Shares to be
issued by the Group under the Firm Placing;
Firm Placing the placing of the Firm Placed Shares with
the Firm Placees pursuant to the Firm Placing
and Open Offer Agreement;
Firm Placing and Agreement the conditional agreement dated
Open Offer Agreement on or about the date of this announcement
between the Group and Investec Bank plc
relating to the Firm Placing
General Meeting the general meeting of the Group to be convened
or GM in connection with the Firm Placing, the
Open Offer and the Share Subscription, details
of which will be set out in the Circular
to be published by the Group
Group or ITM Power the Group and/or its subsidiary undertakings
at the date of this announcement (as defined
in sections 1159 and 1160 of the Act);
Group
Investec or Investec Investec Bank plc, a company incorporated
Bank plc in England and Wales with registered number
00489604 and having its registered office
at 2 Gresham Street, London EC2V 7QP;
Issue Price 40 pence per New Ordinary Share;
Latest Practicable means 5.00 p.m. on 2 October 2019, being
Date the latest practicable date prior to publication
of this announcement;
London Stock Exchange London Stock Exchange plc;
New Ordinary Shares up to 147,053,126 New Ordinary Shares of
5 pence each to be issued by the Group pursuant
to the Firm Placing, the Open Offer and
the Share Subscription;
Notice of General the notice of General Meeting, to be set
Meeting out in the Circular;
Open Offer the conditional invitation by the Group
to Qualifying Shareholders to apply to subscribe
for Open Offer Shares at the Issue Price
on the terms and subject to the conditions
to be set out in the Circular and in the
case of the Qualifying Non-CREST Shareholders
only, the Application Form;
Open Offer Entitlements an entitlement to subscribe for Open Offer
Shares, allocated to a Qualifying Shareholder
under the Open Offer (and, for the avoidance
of doubt, references to Open Offer Entitlements
include Basic Entitlements and Excess CREST
Open Offer Entitlements);
Open Offer Shares up to 17,053,126 New Ordinary Shares to
be offered to Qualifying Shareholders under
the Open Offer;
Ordinary Shares ordinary shares of 5 pence each in the capital
of the Group;
Prospectus Regulation the Prospectus Regulation Rules Instrument
Rules published by the FCA (FCA 2019/80), implementing
the EU Prospectus Regulation 2017/1129;
Qualifying CREST Qualifying Shareholders whose Existing Ordinary
Shareholders Shares on the register of members of the
Group on the Record Date are in uncertificated
form;
Qualifying Non-CREST Qualifying Shareholders whose Existing Ordinary
Shareholders Shares on the register of members of the
Group on the Record Date are held in certificated
form;
Qualifying Shareholders holders of Existing Ordinary Shares on the
register of members of the Group at the
Record Date with the exception (subject
to certain exceptions) of Excluded Overseas
Shareholders;
Record Date 5.00 p.m. on 2 October 2019;
Resolutions the resolutions to be proposed at the General
Meeting which will be set out in full in
the Notice of General Meeting;
Restricted Jurisdictions each of Australia, Canada, Japan, the Republic
of South Africa and the United States;
Shareholders holders of Existing Ordinary Shares;
Share Subscription means the conditional subscription for Ordinary
Shares by Linde UK Holdings No.2 Limited
on the terms and conditions contained in
the Subscription Agreement;
Subscription Agreement means the subscription agreement entered
into between the Group and Linde UK Holdings
No.2 Limited on or about the date of this
announcement, pursuant to which Linde UK
Holdings No.2 Limited has agreed to subscribe
for 95,000,000 Ordinary Shares on the terms
and conditions set out therein;
Subscription Shares means the 95,000,000 Ordinary Shares to
be subscribed for by Linde UK Holdings No.2
Limited pursuant to the Share Subscription;
uncertificated recorded on a register of securities maintained
by Euroclear in accordance with the CREST
Regulations as being in uncertificated form
in CREST and title to which, by virtue of
the CREST Regulations, may be transferred
by means of CREST;
UK or United Kingdom the United Kingdom of England, Scotland,
Wales and Northern Ireland;
US or United States the United States of America, its territories
and possessions, any state of the United
States of America and the District of Columbia;
US Securities Act the US Securities Act of 1933 (as amended);
USE unmatched stock event;
GBP or sterling pounds sterling, the legal currency of the
United Kingdom; and
29.9 per cent. Aggregate the restriction on the number of Open Offer
Limit Shares that each Qualifying Shareholder
may receive under the Open Offer on the
basis that no Qualifying Shareholder shall
be entitled to receive in excess of such
number of Open Offer Shares as would bring
its aggregate interest in the Group to more
than 29.9 per cent. of the Enlarged Share
Capital.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCCKNDDPBDKAKK
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October 03, 2019 02:00 ET (06:00 GMT)
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