TIDMWAFR
RNS Number : 6476A
Walls & Futures REIT PLC
03 June 2021
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
SUCH JURISDICTION.
3 June 2021
WALLS & FUTURES REIT PLC
("Walls & Futures" or the "Company")
Response to Virgata Services Limited announcement
The Directors of Walls & Futures (the "Board") note the
announcement made on 27 May 2021 (the "First Closing Announcement")
by Virgata Services Limited ("Virgata") and in particular that at
the first closing date Virgata had received only 9.13 per cent.
acceptances to its opportunistic offer.
The Board has made clear its reasons why shareholders should
take NO ACTION and not accept the Offer and is delighted that so
few have done so to that date. The Board reiterates the key reasons
that Shareholders should continue to back the current Board:
-- As at 31st March 2021, our Net Asset Value (NAV) was 102p per
share (approximately GBP3.83m) - more than twice the Offer price of
50p per share.
-- We have a proven track record of delivering Specialist
Supported Housing ("SSH"). To date we have invested a total of
GBP1.34 million in our SSH portfolio, which, based on the long-term
nature of the leases, the quality of covenants and income generated
was valued at GBP2.57 million as at 31 March 2021, a 91.8% or
GBP1.23 million increase in our value.
-- We intend to continue and build on this successful strategy
and estimate we will invest approximately a further GBP1 million in
new SSH developments using our cash deposits and from the capital
released from the expected sale of our final London property.
The Board does not think it will be of any further help to
shareholders to respond to each and every point raised by Virgata
in the First Closing Announcement. However, it would like to
address two of the points which the Board believes require further
clarification.
Intention to include a winding-up resolution at the 2022 AGM of
the Company
In our response circular, the Board stated:
"Should the Offer not become unconditional in all respects, the
Walls & Futures Directors therefore intend to include a winding
up resolution in the Company's 2022 notice of annual general
meeting, such meeting to take place before the end of September
2022."
In the First Closing Announcement, Virgata criticised the Board
for not making this intention statement as an undertaking,
stating:
"...it should be made clear that whilst this statement might
appear to be a promise to offer Shareholders such a vote, this
statement is not a binding commitment by your Directors and they
can simply change their minds and carry on with the current
position."
Virgata failed to mention that our statement was made as an
intention statement pursuant to Rule 19.6 of the Code. Under Rule
19.6 of the Code, if the Board were to decide to either: (i) take a
course of action different from its stated intention; or (ii) not
take a course of action which it had stated it intended to take, it
must consult the Panel. Except with the consent of the Panel, if
such a course of action is then not taken, the Board must promptly
make an announcement describing the course of action it has not
taken, and explaining its reasons for not taking, that course of
action (as appropriate). Accordingly, the Board cannot "simply
change its mind" as Virgata indicates.
The Directors did consider whether the statement could have been
provided as a post-offer undertaking and concluded that it would
not have been appropriate pursuant to the provisions of Rule 19.5
of the Code.
The Board is also keen to highlight to Shareholders that Virgata
did not provide any post-offer undertakings in the Offer Document
and only provided intention statements, a number of which were
caveated by the performance of a strategic review.
Virgata's estimate of present value of a Walls & Futures
Share in a solvent winding-up
The First Close Announcement included an estimate by Virgata of
the present value of a Walls & Futures Share in a solvent
winding-up of 55p to 60p per share on the basis of certain broad
assumptions. The Board believes the estimate by Virgata of the
amount receivable by shareholders in the case of a solvent
liquidation of the business is materially lower than what would be
achievable. Virgata will no doubt criticise the Board for not
putting a figure on its own estimate. However, under the Code
whilst an offeror can make such statements, were the Company to
provide any quantitative indication of the value that may be
achievable, this would constitute a quantified financial benefit
statement under Rule 28.1 of the Code and the Company would be
required to engage reporting accountants to state that, in their
opinion, the statement has been properly compiled on the basis
stated and its financial adviser stating that, in its opinion, the
statement has been prepared with due care and consideration. This
would incur significant additional costs which the Board does not
consider to be the best use of the Company's resources at this
time.
We look forward to closing this unfortunate chapter and move
forward to delivering the ambitious and credible growth strategy as
outlined in our response document.
A further announcement will be made as and when appropriate.
Definitions in this announcement are the same as those used in
the announcement issued by the Company dated 20 May 2021.
Enquiries:
Walls & Futures REIT PLC 0333 700 7171
Joe McTaggart, Chief Executive
Website www.wallsandfutures.com
Allenby Capital Limited (Corporate and Financial Adviser)
Nick Harriss/James Reeve/David Worlidge 020 3328 5656
Disclosure requirements of the Takeover Code
Under Rule 8.3(a) of the Takeover Code, any person who is
interested in 1% or more of any class of relevant securities of an
offeree company or of any securities exchange offeror (being any
offeror other than an offeror in respect of which it has been
announced that its offer is, or is likely to be, solely in cash)
must make an Opening Position Disclosure following the commencement
of the offer period and, if later, following the announcement in
which any securities exchange offeror is first identified. An
Opening Position Disclosure must contain details of the person's
interests and short positions in, and rights to subscribe for, any
relevant securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) applies must be made by no later than
3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later
than 3.30 pm (London time) on the 10th business day following the
announcement in which any securities exchange offeror is first
identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the Takeover Code, any person who is, or
becomes, interested in 1% or more of any class of relevant
securities of the offeree company or of any securities exchange
offeror must make a Dealing Disclosure if the person deals in any
relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the
dealing concerned and of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of
(i) the offeree company and (ii) any securities exchange
offeror(s), save to the extent that these details have previously
been disclosed under Rule 8. A Dealing Disclosure by a person to
whom Rule 8.3(b) applies must be made by no later than 3.30 pm
(London time) on the business day following the date of the
relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk ,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Takeover Panel's Market
Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as
to whether you are required to make an Opening Position Disclosure
or a Dealing Disclosure.
Additional information
Allenby Capital Limited ("Allenby Capital") is authorised and
regulated by the Financial Conduct Authority in the United Kingdom.
Allenby Capital is acting as financial adviser exclusively for
Walls & Futures and no one else in connection with the matters
set out in this announcement and will not regard any other person
as its client in relation to the matters set out in this
announcement and will not be responsible to anyone other than Walls
& Futures for providing the protections afforded to clients of
Allenby Capital or its affiliates, or for providing advice in
relation to the contents of this announcement or any other matter
referred to herein.
Publication on a website
In accordance with Rule 26.1 of the Code, a copy of this
announcement will be available at
https://reit.wallsandfutures.com/unsolicited-offer . The content of
the website referred to in this announcement is not incorporated
into and does not form part of this announcement.
A copy of this announcement will be sent to shareholders later
today.
Basis and sources of information
1. The NAV as at 31 March 2021 has been calculated based on the
valuation of the Company's assets as set out in the Valuation
Report, after taking account of GBP658,468 of cash and cash
equivalents and making appropriate balance sheet adjustments and
has been calculated based on the issued share capital of Walls
& Futures of 3,755,086; and
2. The 91.8 per cent. increase in the value of the SSH
developments is based on the value of the SSH assets in the
Valuation Report of GBP2.57 million versus the total amount
invested in the SSH developments of GBP1.34 million which has been
taken from the Company's annual report and accounts for the years
ended 31 March 2018 and 31 March 2020. The valuer has confirmed to
the Board that an updated valuation as at 3 June 2021 would not be
materially different.
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END
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