TIDMHONY TIDMPSSL
RNS Number : 2164W
Honeycomb Investment Trust PLC
14 August 2020
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, 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.
THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN ANNOUNCEMENT OF A FIRM
INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CITY CODE ON
TAKEOVERS AND MERGERS (THE "CODE") AND THERE CAN BE NO CERTAINTY
THAT AN OFFER WILL BE MADE.
14 August 2020
For immediate release
Update Regarding a Possible Combination of Honeycomb Investment
Trust plc ("HIT") and
Pollen Street Secured Lending plc ("PSSL")
HIT wishes to provide an update regarding the potential
combination of HIT and PSSL (together the "Enlarged Group"),
following the announcement made on 6 August 2020.
HIT remains convinced of the strategic rationale of combining
both companies to create the leading UK specialty finance
investment trust. HIT believes that the proposed merger on a Net
Asset Value ("NAV") for NAV basis (the "Possible Merger"),
resulting in an exchange ratio of 0.9335 new HIT ordinary shares in
exchange for each PSSL ordinary share, provides significant value
creation potential for both sets of shareholders, providing an
opportunity for both sets of shareholders to realise NAV over time
in more normalised markets. However, recognising that certain PSSL
shareholders may have a preference for upfront liquidity, HIT will
provide an attractive liquidity opportunity following completion of
the merger.
As previously stated, HIT would seek to operate an active
discount management policy as well as proactively seeking to manage
any investor specific liquidity demands. HIT is in active
consultation with PSSL shareholders regarding the terms of the
active discount management policy for the Enlarged Group. Following
completion of the combination, the liquid assets of the Enlarged
Group will be utilised to maximise total shareholder returns which
will include, inter alia, significant periodic returns of capital
to shareholders via the use of selective share buybacks and/or
tender offers as well as potential strategic placements with new
investors. HIT's commitment to a value accretive active share price
discount management strategy was highlighted most recently by the
share buyback announced on 10 August 2020.
Following completion of the combination, HIT will conduct a
GBP200 million buyback via a tender offer structure to recognise
the desire of certain investors to realise cash. The price will be
struck at an attractive premium to the prevailing trading levels,
at a price no lower than 10 per cent discount to the NAV per share
of the Enlarged Group.
The pro forma borrowings of the Enlarged Group will leave
sufficient headroom relative to the current leverage targets of HIT
and PSSL.
HIT has consulted with certain of its largest shareholders who
have indicated they are, in principle, supportive of the Possible
Merger. These investors also hold shares representing, in
aggregate, 30.7 per cent of the PSSL total number of outstanding
shares(1) .
Other matters
This announcement does not constitute an announcement of a firm
intention to make an offer under Rule 2.7 of the Code. Any offer
will be made solely by formal offer documentation, which will set
out the full terms and conditions of any offer. There can be no
certainty that any offer will ultimately be made.
In accordance with Rule 2.6(a) of the Code, HIT is required, by
no later than 5.00pm on 3 September 2020, either to announce a firm
intention to make an offer for PSSL in accordance with Rule 2.7 of
the Code or to announce that it does not intend to make an offer,
in which case the announcement will be treated as a statement to
which Rule 2.8 of the Code applies. This deadline can be extended
with the consent of the Takeover Panel in accordance with Rule
2.6(c) of the Code.
Pursuant to Rule 2.5 of the Code, HIT reserves the right to:
1. Amend the terms of any offer (including making an offer on
less favourable terms than those set out in this announcement):
a. with the agreement or recommendation of the board of PSSL;
b. if a third party announces a firm intention to make an offer
for PSSL which, at that date, is of a value less than the value
implied by the Possible Merger;
c. following an announcement by PSSL of a whitewash transaction pursuant to the Code; or
d. to take account of the value of any dividend or other
distribution which is announced, declared, made or paid by PSSL or
HIT after the date of this announcement, other than the dividends,
if any:
i. declared by PSSL in respect of the three month period to 30
June 2020, provided that such dividend does not exceed 12.0 pence
per PSSL ordinary share in aggregate and is covered by income for
the period;
ii. declared by PSSL in respect of the three month period to 30
September 2020, provided that such dividend does not exceed 12.0
pence per PSSL ordinary share in aggregate and is covered by income
for the period;
iii. declared by HIT in respect of the three month period to 30
June 2020, provided that such dividend does not exceed 20.0 pence
per HIT ordinary share in aggregate; and/or
iv. declared by HIT in respect of the three month period to 30
September 2020, provided that such dividend does not exceed 20.0
pence per HIT ordinary share in aggregate.
2. Vary the form of consideration as set out above and/or
introduce other forms of consideration such as cash in substitution
for all or part of the share consideration.
A further announcement will be made in due course.
(1) Supportive shareholders comprise: Quilter Investors Limited
(14,603,993 shares), Standard Life Aberdeen plc (4,740,501 shares),
Thesis Asset Management Limited (1,669,314 shares) and AXA
Investment Managers (1,640,000 shares)
Enquiries:
Greenbrook (PR adviser to HIT) +44 (0) 207 952 2000
Andrew Honnor honeycomb@greenbrookpr.com
Alex Jones
Matthew Goodman
Goldman Sachs International (Joint Financial Adviser to HIT) +44 (0) 207 774 1000
John Brennan
Chris Emmerson
Ken Hayahara
Ronan Breen
Jefferies International Limited (Joint Financial Adviser to HIT) +44 (0) 207 029 8000
Graham Davidson +44 (0) 207 029 8076
Paul Bundred +44 (0) 207 548 4226
Neil Winward +44 (0) 207 029 8140
Disclaimer
Goldman Sachs International, which is authorised by the
Prudential Regulation Authority ("PRA") and regulated by the PRA
and the Financial Conduct Authority ("FCA") in the United Kingdom,
is acting exclusively for HIT and for no one else in connection
with the possible offer and will not be responsible to anyone other
than HIT for providing the protections afforded to its clients or
for providing advice in relation to the possible offer, the
contents of this announcement or any other matters referred to in
this announcement.
Jefferies which is authorised and regulated in the UK by the
FCA, is acting exclusively as financial adviser to HIT and no one
else in connection with the possible offer and shall not be
responsible to anyone other than HIT for providing the protections
afforded to clients of Jefferies nor for providing advice in
connection with the possible offer or any matter referred to
herein. Neither Jefferies, nor any of its affiliates, subsidiaries
or branches owes or accepts any duty, liability or responsibility
whatsoever (whether direct or indirect, whether in contract, in
tort, under statute or otherwise) to any person other than HIT in
connection with this Announcement, any statement contained herein
or otherwise.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in 1
per cent 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 Code, any person who is, or becomes,
interested in 1 per cent 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.
Publication of this announcement
A copy of this announcement will be available on HIT's website
at https://www.honeycombplc.com/announcements. The content of the
website referred to in this announcement is not incorporated into
and does not form part of this announcement.
Cautionary note regarding forward-looking statements
This announcement contains certain forward-looking statements
with respect to the financial condition, results of operations and
business of the Enlarged Group and certain plans and objectives of
HIT with respect thereto. These forward-looking statements can be
identified by the fact that they do not relate only to historical
or current facts. Forward-looking statements often use words such
as "anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "hope", "aims", "continue", "will", "may",
"should", "would", "could", or other words of similar meaning.
These statements are based on assumptions and assessments made by
HIT in light of its experience and its perception of historical
trends, current conditions, future developments and other factors
it believes appropriate. By their nature, forward-looking
statements involve risk and uncertainty, because they relate to
events and depend on circumstances that will occur in the future
and actual results and developments could differ materially from
those expressed in or implied by such forward-looking statements.
Although it is believed that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be
given that such expectations will prove to have been correct and
you are therefore cautioned not to place undue reliance on these
forward-looking statements which speak only as at the date of this
announcement. HIT does not assume any obligation to update or
correct the information contained in this announcement (whether as
a result of new information, future events or otherwise), except as
required by applicable law.
There are several factors which could cause actual results to
differ materially from those expressed or implied in
forward-looking statements. Among the factors that could cause
actual results to differ materially from those described in the
forward-looking statements are changes in the global, political,
economic, business, competitive, market and regulatory forces,
future exchange and interest rates, changes in tax rates and future
business combinations or dispositions.
Additional information
This announcement is not intended to, and does not, constitute
or form part of any offer, invitation or the solicitation of an
offer to purchase, otherwise acquire, subscribe for, sell or
otherwise dispose of, any securities whether pursuant to this
announcement or otherwise.
The distribution of this announcement in jurisdictions outside
the United Kingdom may be restricted by law and therefore persons
into whose possession this announcement comes should inform
themselves about, and observe, such restrictions. Any failure to
comply with the restrictions may constitute a violation of the
securities law of any such jurisdiction.
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
OFFFZGMRMDNGGZM
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August 14, 2020 07:39 ET (11:39 GMT)
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