TIDMINS
RNS Number : 7281K
Instem plc
30 August 2023
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
30 August 2023
RECOMMED CASH OFFER
by
ICHOR MANAGEMENT LIMITED
(a newly incorporated company controlled by funds managed by
ARCHIMED SAS)
for
INSTEM PLC
to be effected by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
Summary
-- The board of directors of Ichor Management Limited ("Bidco")
and the board of directors of Instem plc ("Instem") are pleased to
announce that they have reached agreement on the terms of a
recommended cash offer to be made by Bidco for the entire issued
and to be issued ordinary share capital of Instem (the
"Acquisition"). It is intended that the Acquisition will be
implemented by way of a scheme of arrangement under Part 26 of the
Companies Act.
-- Under the terms of the Acquisition, each Instem Shareholder
will be entitled to receive:
833 pence in cash per Instem Share
-- The Acquisition values the entire issued and to be issued
ordinary share capital of Instem at approximately GBP203
million.
-- The Acquisition Price represents a premium of approximately:
- 41 per cent. to the Closing Price of 590 pence per Instem
Share on 29 August 2023 (being the last Business Day prior to this
Announcement);
- 35 per cent. to the Volume Weighted Average Price per Instem
Share during the three month period ended 29 August 2023 (being the
last Business Day prior to this Announcement); and
- 34 per cent. to the Volume Weighted Average Price per Instem
Share during the six month period ended 29 August 2023 (being the
last Business Day prior to this Announcement).
Background to and reasons for the Acquisition
-- Instem is a market leading provider of workflow, data and IT
solutions across the drug development lifecycle to the global life
sciences market and is well positioned to capitalise on the growing
R&D market due to its high-quality product portfolio and
development potential. Bidco is fully aligned with Instem
management team's vision for Instem to achieve its organic and
inorganic growth ambitions.
-- Bidco believes that Instem can leverage ARCHIMED's deep
industry knowledge and network as a healthcare specialist investor
to accelerate Instem's growth strategy and support Instem's
management team in expanding its product offering and continuing to
transition customers from on-premise to SaaS.
-- Bidco believes that the Acquisition has a strong strategic
rationale, representing a highly compelling opportunity to enable
Instem to:
- capitalise on operating leverage via its transition of its
market leading Study Management product offering from an on-premise
delivery model to a SaaS based model;
- accelerate organic growth in its growing In Silico &
Translational Science and Clinical Trial Analytics business
segments by leveraging ARCHIMED's network and experience;
- deploy additional capital for accretive and value enhancing M&A opportunities;
- continue the vision of Instem's highly experienced management team; and
- augment Instem's position as a market-leader and trusted
partner to the global health and life sciences community.
Recommendation
-- The Instem Directors, who have been so advised by Rothschild
& Co and Singer Capital Markets as to the financial terms of
the Acquisition, consider the terms of the Acquisition to be fair
and reasonable. In providing its advice to the Instem Directors,
Rothschild & Co and Singer Capital Markets have taken into
account the commercial assessments of the Instem Directors.
-- Accordingly, the Instem Directors intend to recommend
unanimously that the Instem Shareholders vote in favour of (or
procure votes in favour of) the Scheme at the Court Meeting and the
Resolution to be proposed at the General Meeting (or, subject to
the terms of the Co-operation Agreement and with the consent of the
Takeover Panel, if Bidco exercises its right to implement the
Acquisition by way of a Takeover Offer, to accept such offer), as
the Instem Directors who have an interest in Instem Shares (in a
personal capacity or through a nominee or related family trust)
have irrevocably undertaken to do (or procure to be done) in
respect of their own (and their connected persons') beneficial
holdings of 2,107,579 Instem Shares (representing, in aggregate,
approximately 9.20 per cent. of the Instem Shares in issue on 29
August 2023 (being the last Business Day prior to this
Announcement)).
-- Full details of the irrevocable undertakings received by
Bidco are set out in Appendix III to this Announcement.
Information on Bidco and ARCHIMED
Bidco
Bidco is a newly incorporated company controlled by funds
managed by ARCHIMED. Bidco was formed for the purposes of the
Acquisition and has not traded prior to the date of this
Announcement nor has it entered into any obligation other than in
connection with the Acquisition.
ARCHIMED
With offices in Europe, North America and Asia, ARCHIMED is a
leading global investment firm that is exclusively focused on
healthcare industries, with more than EUR8 billion of assets under
management and past and current investments in 32 healthcare
companies that serve customers around the world. Over the last
twenty years, ARCHIMED's leadership team has directly managed and
invested in over eighty small to large size healthcare companies
globally, representing over EUR30 billion of combined value.
ARCHIMED specialises in investing in operating companies across
various segments of the healthcare industry, including Healthcare
IT, Biologic Services, Biopharma Products, In Vitro Diagnostics,
Med Tech, Pharma Services and Consumer Health. Its mix of
operational, medical, scientific and financial expertise allows
ARCHIMED to serve as both a strategic and financial partner to
North American and European healthcare businesses. ARCHIMED's
specialisation in healthcare industries also enables it to develop
a deep understanding of the unique challenges and opportunities for
healthcare businesses and leverage its network of healthcare
talents to support its portfolio companies.
Since inception, ARCHIMED has raised five main funds and made
investments ranging from EUR10 million to EUR1 billion. It has been
particularly focused on providing its companies with the strategic,
operational and financial resources required to facilitate the
companies' efforts in innovation, internationalisation, capacity
increase, product range expansion and acquisitions.
Timetable and Conditions
-- It is intended that the Acquisition be implemented by way of
a Court-sanctioned scheme of arrangement under Part 26 of the
Companies Act. The purpose of the Scheme is to provide for Bidco to
acquire the whole of the issued and to be issued share capital of
Instem. The Scheme will be put to Instem Shareholders at the Court
Meeting and to Instem Shareholders at the General Meeting. In order
to become Effective, the Scheme must be approved by a majority in
number of the Instem Shareholders voting at the Court Meeting,
either in person or by proxy, representing at least 75 per cent. in
value of the Scheme Shares voted. The Resolution must also be
approved by Instem Shareholders at the General Meeting. The General
Meeting is expected to be held immediately after the Court
Meeting.
-- The Scheme will also need to be sanctioned by the Court.
Finally, a copy of the Court Order must be delivered to the
Registrar of Companies for registration, upon which the Scheme will
become Effective.
-- The Acquisition will be made in accordance with the Code and
is subject to the Conditions and certain further terms set out in
Appendix I, and to the full terms and conditions which will be set
out in the Scheme Document. The Conditions include the receipt of
regulatory approvals as further described in this Announcement.
-- It is expected that the Scheme Document, containing further
information about the Acquisition and notices of the Court Meeting
and the General Meeting, together with the associated Forms of
Proxy, will be posted to Instem Shareholders within 28 days of this
Announcement (or such later time as Instem, Bidco and the Takeover
Panel agree) and the Court Meeting and the General Meeting are each
expected to be held as soon as possible thereafter, giving the
required notice for such meetings.
-- The Acquisition is currently expected to complete during the
fourth quarter of 2023, subject to the satisfaction or (where
applicable) waiver of the Conditions. An expected timetable of key
events relating to the Acquisition will be provided in the Scheme
Document.
Commenting on the Acquisition, David Gare, Chair of Instem,
said:
"The Instem Board is pleased with the considerable progress made
by the Company following the successful integration of acquisitions
and the implementation of its strategy to achieve and maintain a
growing portfolio of 'world leading life science workflow and data
solutions'.
While this strategy, endorsed by the Board, is anticipated to
generate substantial long-term value for shareholders, we also note
that the next phase of development for the business is at an early
stage and there is an element of risk attached to some of our
recent initiatives, which will take time to deliver value.
The offer from Bidco represents an attractive valuation and
offers shareholders the certainty of cash today, while also fairly
reflecting the exceptional quality of the Instem business, its
people and its future prospects. Under Bidco's private ownership,
without the costs and regulation of a listed company, Instem will
be able to pursue its organic growth strategy, while benefiting
from the expertise and capital to accelerate its successful
acquisitive growth plan.
Accordingly, those members of the Board who are also Instem
Shareholders have irrevocably undertaken to vote the Instem Shares
in which they are interested in favour of the Acquisition. The
Board also intends to recommend unanimously that Instem
Shareholders also vote in favour of the Acquisition."
This summary should be read in conjunction with, and is subject
to, the full text of this Announcement and its Appendices. In
particular, the Acquisition is subject to the Conditions and
certain further terms set out in Appendix I and to the full terms
and conditions which will be set out in the Scheme Document.
Appendix II contains details of sources of information and bases of
calculation contained in this Announcement. Appendix III contains
certain details relating to the irrevocable undertakings referred
to in this Announcement. Appendix IV contains definitions of
certain terms used in this Announcement.
Instem
Phil Reason Via Walbrook
Nigel Goldsmith
Rothschild & Co (Financial Adviser to Instem)
Alistair Allen Tel: +44 (0) 161 827 3800
Julian Hudson
Tom Palmer
Singer Capital Markets Advisory LLP (Nominated Adviser, Joint
Financial Adviser and Joint Broker to Instem)
Peter Steel Tel: +44 (0) 20 7496 3000
Alex Bond
Oliver Platts
Stifel Nicolaus Europe Limited (Joint Broker to Instem)
Ben Maddison Tel: +44 (0) 20 7710 7600
Richard Short
Walbrook Financial PR (Public Relations Adviser to Instem)
Tom Cooper Tel: +44 (0) 20 7933 8780
Nick Rome
Joe Walker
ARCHIMED SAS
Vincent Guillaumot Tel: +33 4 81 11 35 33
Brian Sheridan
Sandrine Laporte
Moelis & Company UK LLP (Financial Adviser to ARCHIMED and
Bidco)
Philippe Gallone Tel: +44 (0) 20 7634 3500
Chris Raff
François Saint-Lo
Simon Chaudhuri
Latham & Watkins (London) LLP are retained as legal adviser
to ARCHIMED and Bidco.
Squire Patton Boggs (UK) LLP are retained as legal adviser to
Instem.
Disclaimers
Rothschild & Co , which is authorised and regulated by the
FCA in the United Kingdom, is acting exclusively as financial
adviser to Instem and for no one else in connection with the
matters set out in this Announcement and will not be responsible to
anyone other than Instem for providing the protections afforded to
clients of Rothschild & Co, nor for providing advice in
relation to the Acquisition or any other matters referred to in
this Announcement. Neither Rothschild & Co nor any of its
subsidiaries, branches or affiliates (nor their respective
directors, officers, employees or agents) 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 who is not a client of Rothschild & Co in connection
with this Announcement, any statement contained in this
Announcement, the Acquisition or otherwise. No representation or
warranty, express or implied, is made by Rothschild & Co as to
the contents of this Announcement .
Singer Capital Markets Advisory LLP, which is authorised and
regulated by the FCA in the United Kingdom, is acting as financial
adviser and nominated adviser exclusively for Instem and no-one
else in connection with the subject matter of this Announcement and
will not be responsible to anyone other than Instem for providing
the protections afforded to clients of Singer Capital Markets nor
for providing advice in connection with the subject matter of this
Announcement. Neither Singer Capital Markets nor any of its
affiliates (nor any of their respective directors, partners,
officers, employees or agents) 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 who
is not a client of Singer Capital Markets in connection with this
Announcement, any statement contained herein, the Acquisition or
otherwise. No representation or warranty, express or implied, is
made by Singer Capital Markets as to the contents of this
Announcement.
Moelis & Company UK LLP ("Moelis"), which is regulated by
the FCA in the United Kingdom, is acting exclusively for ARCHIMED
and Bidco and no one else in connection with the Acquisition and
other matters set out in this Announcement and will not be
responsible to anyone other than ARCHIMED and Bidco for providing
the protections afforded to clients of Moelis, or for providing
advice in connection with the Acquisition or any matter referred to
herein. Neither Moelis nor any of its affiliates 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 who is not a client of Moelis in connection with this
Announcement, any statement contained herein or otherwise.
Further information
This Announcement is for information purposes only and is not
intended to and does not constitute, or form any part of, an offer
to sell or subscribe for or any invitation to purchase or subscribe
for any securities or the solicitation of any vote or approval in
any jurisdiction pursuant to the Acquisition or otherwise. The
Acquisition will be made solely through and on the terms set out in
the Scheme Document (or, in the event that the Acquisition is to be
implemented by means of a Takeover Offer, the Offer Document) and
the accompanying Forms of Proxy, which will contain the full terms
and conditions of the Acquisition, including details of how to vote
in respect of the Acquisition. Any vote, approval, decision or
other response to the Acquisition should be made only on the basis
of the information in the Scheme Document (or, if the Acquisition
is implemented by way of a Takeover Offer, the Offer Document) .
Scheme Shareholders are strongly advised to read the formal
documentation in relation to the Acquisition once it has been
despatched.
This Announcement does not constitute a prospectus or prospectus
exempted document.
The statements contained in this Announcement are made as at the
date of this Announcement, unless some other time is specified in
relation to them, and service of this Announcement shall not give
rise to any implication that there has been no change in the facts
set forth in this Announcement since such date.
Overseas shareholders
This Announcement has been prepared for the purpose of complying
with English law, the AIM Rules and the Code and the information
disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with
the laws of jurisdictions outside the United Kingdom.
The laws of the relevant jurisdictions may affect the
availability of the Acquisition to persons who are not resident in
the United Kingdom . Persons who are not resident in the United
Kingdom, or who are subject to laws of any jurisdiction other than
the United Kingdom, should inform themselves about, and observe any
applicable requirements. Any person (including, without limitation,
nominees, trustees and custodians) who would, or otherwise intends
to, forward this Announcement, the Scheme Document or any
accompanying document to any jurisdiction outside the United
Kingdom should refrain from doing so and seek appropriate
professional advice before taking any action. In particular, the
ability of persons who are not resident in the United Kingdom to
vote their Instem Shares at the Court Meeting or the General
Meeting, or to execute and deliver Forms of Proxy appointing
another to vote their Instem Shares in respect of the Court Meeting
or the General Meeting on their behalf, may be affected by the laws
of the relevant jurisdiction in which they are located.
Any failure to comply with the applicable legal or regulatory
requirements may constitute a violation of the laws and/or
regulations of any such jurisdiction . To the fullest extent
permitted by applicable law, the companies and persons involved in
the Acquisition disclaim any responsibility and liability for the
violation of such restrictions by any person.
The Acquisition will not be made, directly or indirectly, in or
into or by use of the mails or any other means or instrumentality
(including, without limitation, telephonic or electronic) of
interstate or foreign commerce of, or any facility of a national,
state or other securities exchange of, a Restricted Jurisdiction,
and the Acquisition will not be capable of acceptance by any such
use, means, instrumentality or facility or from within a Restricted
Jurisdiction . Accordingly, copies of this Announcement and formal
documentation relating to the Acquisition are not being, and must
not be, directly or indirectly, mailed or otherwise forwarded or
distributed in, into or from a Restricted Jurisdiction and persons
receiving this Announcement (including custodians, nominees and
trustees) must not distribute or send it into or from a Restricted
Jurisdiction. In the event that the Acquisition is implemented by
way of a Takeover Offer and extended into the US, Bidco will do so
in satisfaction of the procedural and filing requirements of US
securities laws at that time, to the extent applicable thereto. The
Acquisition relates to the shares of a company incorporated in
England and it is proposed to be made by means of a scheme of
arrangement provided for under English law. The Scheme will relate
to the shares of a UK company that is a "foreign private issuer" as
defined under Rule 3b-4 under the US Exchange Act. A transaction
effected by means of a scheme of arrangement is not subject to any
shareholder vote, proxy solicitation and tender offer rules under
the US Exchange Act. Accordingly, the Scheme is subject to the
disclosure requirements and practices applicable in the UK to
schemes of arrangement, which differ from the disclosure
requirements and practices of US shareholder vote, proxy
solicitation or tender offer rules. Financial information included
in the relevant documentation will have been prepared in accordance
with accounting standards applicable in the UK and may not be
comparable to the financial information of, or the accounting
standards applicable to, US companies. However, if Bidco were to
elect to implement the Acquisition by means of a Takeover Offer,
such Takeover Offer shall be made in compliance with all applicable
laws and regulations, including section 14(e) of the US Exchange
Act and Regulation 14E thereunder, if applicable. Such Takeover
Offer would be made in the US by Bidco and no one else. In addition
to any such Takeover Offer, Bidco, certain affiliated companies and
the nominees or brokers (acting as agents) may make certain
purchases of, or arrangements to purchase, shares in Instem outside
such Takeover Offer during the period in which such Takeover Offer
would remain open for acceptance. If such purchases or arrangements
to purchase are made they would be made outside the United States
in compliance with applicable law, including the US Exchange Act.
It may be difficult for a US-based investor to enforce his or her
rights and any claim he or she may have arising under US securities
laws, since the Scheme relates to the shares of a company located
in the UK, and some or all of its officers and directors may be
residents of non-US jurisdictions. A US-based investor may not be
able to sue a company located in the UK, or its officers or
directors, in a foreign court for alleged violations of US
securities laws, and it may be difficult to compel a foreign
company and its affiliates to subject themselves to a US court's
judgment.
Forward-looking statements
This Announcement, oral statements made regarding the
Acquisition, and other information published by Instem, Bidco and
ARCHIMED may contain certain "forward-looking statements" with
respect to Instem, Bidco and ARCHIMED. 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", "will", "may",
"should", "would", "could" or other words or terms of similar
meaning or the negative thereof. Forward-looking statements
include, for example, statements relating to the following: (i)
future capital expenditures, expenses, revenues, earnings,
synergies, economic performance, indebtedness, financial condition,
dividend policy, losses and future prospects; (ii) business and
management strategies of ARCHIMED and/or Bidco and the expansion
and growth of Instem and potential synergies resulting from the
Acquisition; and (iii) the effects of government regulation on the
business of Instem.
These forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause actual
results, performance or developments to differ materially from
those expressed in or implied by such forward-looking statements.
These forward-looking statements are based on numerous assumptions
regarding present and future strategies and environments. None of
ARCHIMED, Bidco or Instem, nor any of their respective associates,
directors, officers, employees or advisers, provides any
representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward-looking statements in
this Announcement will actually occur. You are cautioned not to
place undue reliance on such forward-looking statements, which
speak only as of the date hereof. All subsequent oral or written
forward-looking statements attributable to ARCHIMED, Bidco or
Instem or any person acting on their behalf are expressly qualified
in their entirety by the cautionary statement above. Should one or
more of these risks or uncertainties materialise, or should
underlying assumptions prove incorrect, actual results may vary
materially from those described in this Announcement. None of
ARCHIMED, Bidco or Instem assume any obligation to update publicly
or revise forward-looking or other statements contained in this
Announcement, whether as a result of new information, future events
or otherwise, except to the extent legally required.
No profit forecasts or estimates
No statement in this Announcement is intended as a profit
forecast or estimate for ARCHIMED, Bidco or Instem in respect of
any period and no statement in this Announcement should be
interpreted to mean that earnings or earnings per Instem Share for
the current or future financial years would necessarily match or
exceed the historical published earnings or earnings per Instem
Share.
Right to switch to a Takeover Offer
Subject to the terms of the Co-operation Agreement, Bidco
reserves the right to elect, with the consent of the Takeover
Panel, to implement the Acquisition by way of a Takeover Offer for
the entire issued and to be issued ordinary share capital of Instem
as an alternative to the Scheme. In such an event, the Takeover
Offer will be made in accordance with the terms and conditions set
out in this Announcement which would apply to the Scheme (with any
modifications or amendments to such terms and conditions as may be
required by the Takeover Panel or which are necessary as a result
of Bidco's election to implement the Acquisition by way of a
Takeover Offer), in accordance with the Co-operation Agreement and
subject to the amendment referred to in Appendix I to this
Announcement.
Publication on website
In accordance with Rule 26.1 of the Code, a copy of this
Announcement will be made available (subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions), free of charge, on Instem's website at
https://investors.instem.com and on Bidco's website at
www.Ichor-offer.com by no later than 12:00 noon on the Business Day
following the date of this Announcement. Neither the contents of
this website nor the content of any other website accessible from
hyperlinks on such websites is incorporated into, or forms part of,
this Announcement.
Requesting hard copies
In accordance with Rule 30.3 of the Code, a person so entitled
may request a hard copy of this Announcement, free of charge, by
contacting Instem's registrar, Computershare Investor Services PLC
during business hours (8.30 a.m. to 5.30 p.m.) on +44 (0)370 703
6041 or by submitting a request in writing to Computershare
Investor Services PLC at The Pavilions, Bridgwater Road, Bristol,
BS13 8AE . For persons who receive a copy of this Announcement in
electronic form or via a website notification, a hard copy of this
Announcement will not be sent unless so requested. In accordance
with Rule 30.3 of the Code, a person so entitled may also request
that all future documents, announcements and information to be sent
to them in relation to the Acquisition should be in hard copy
form.
Electronic communications - information for Instem
Shareholders
Please be aware that addresses, electronic addresses and certain
information provided by Instem Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Instem may be provided to Bidco during the
Offer Period as required under section 4 of Appendix 4 of the Code
to comply with Rule 2.11(c) of the Code.
Rounding
Certain figures included in this Announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures that precede them.
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 Instem 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) Instem 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 p.m. (London time) on
the 10th Business Day following the commencement of the Offer
Period and, if appropriate, by no later than 3.30 p.m. (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 Instem 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 Instem or of any securities exchange offeror must
make a Dealing Disclosure if the person deals in any relevant
securities of Instem 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) Instem and
(ii) any securities exchange offeror, 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 p.m. (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 Instem 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 Instem and by
any offeror, and Dealing Disclosures must also be made by Instem,
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.
Rule 2.9 of the Code
For the purposes of Rule 2.9 of the Code, Instem confirms that,
as at the date of this Announcement, it had in issue 22,899,433
ordinary shares of 10 pence each. No shares are held in treasury.
The ISIN for the ordinary shares is GB00B3TQCK30.
General
If you are in any doubt about the contents of this Announcement
or the action you should take, you are recommended to seek your own
independent financial advice immediately from your stockbroker,
bank manager, solicitor or independent financial adviser duly
authorised under FSMA if you are resident in the United Kingdom or,
if not, from another appropriate authorised independent financial
adviser.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
30 August 2023
RECOMMED CASH OFFER
by
ICHOR MANAGEMENT LIMITED
(a newly incorporated company controlled by funds managed by
ARCHIMED SAS)
for
INSTEM PLC
to be effected by means of a Scheme of Arrangement
under Part 26 of the Companies Act 2006
1. Introduction
The board of directors of Ichor Management Limited ("Bidco") and
the board of directors of Instem plc ("Instem") are pleased to
announce that they have reached agreement on the terms of a
recommended cash offer to be made by Bidco for the entire issued
and to be issued ordinary share capital of Instem (the
"Acquisition").
It is intended that the Acquisition will be implemented by way
of a scheme of arrangement under Part 26 of the Companies Act.
2. The Acquisition
Under the terms of the Acquisition, which will be subject to the
Conditions and certain further terms set out in Appendix I and to
the full terms and conditions which will be set out in the Scheme
Document, each Instem Shareholder will be entitled to receive:
833 pence in cash per Instem Share
-- The Acquisition values the entire issued and to be issued
ordinary share capital of Instem at approximately GBP203
million.
-- The Acquisition Price represents a premium of approximately:
- 41 per cent. to the Closing Price of 590 pence per Instem
Share on 29 August 2023 (being the last Business Day prior to this
Announcement);
- 35 per cent. to the Volume Weighted Average Price per Instem
Share during the three month period ended 29 August 2023 (being the
last Business Day prior to this Announcement); and
- 34 per cent. to the Volume Weighted Average Price per Instem
Share during the six month period ended 29 August 2023 (being the
last Business Day prior to this Announcement).
The Instem Shares will be acquired by Bidco with full title
guarantee, fully paid and free from all liens, equitable interests,
charges, encumbrances, rights of pre-emption and any other third
party rights or interests whatsoever and together with all rights
existing at the date of this Announcement or thereafter attaching
thereto, including (without limitation) the right to receive and
retain, in full, all dividends and other distributions (if any)
declared, made or paid or any other return of capital (whether by
way of reduction of share capital or share premium account or
otherwise) made on or after the Effective Date in respect of the
Instem Shares.
If any dividend or other distribution in respect of the Instem
Shares is declared, paid or made on or after the date of this
Announcement, Bidco reserves the right to reduce the consideration
payable for each Instem Share under the terms of the Acquisition by
the amount per Instem Share of such dividend or distribution, in
which case any reference in this Announcement to the consideration
payable under the terms of the Acquisition will be deemed to be a
reference to the consideration as so reduced.
3. Recommendation
The Instem Directors, who have been so advised by Rothschild
& Co and Singer Capital Markets as to the financial terms of
the Acquisition, consider the terms of the Acquisition to be fair
and reasonable. In providing its advice to the Instem Directors,
Rothschild & Co and Singer Capital Markets have taken into
account the commercial assessments of the Instem Directors.
Accordingly, the Instem Directors intend to recommend
unanimously that the Instem Shareholders vote in favour of ( or
procure votes in favour of ) the Scheme at the Court Meeting and
the Resolution to be proposed at the General Meeting (or, subject
to the terms of the Co-operation Agreement and with the consent of
the Takeover Panel, if Bidco exercises its right to implement the
Acquisition by way of a Takeover Offer, to accept such offer), as
the Instem Directors who have an interest in Instem Shares (in a
personal capacity or through a nominee or related family trust)
have irrevocably undertaken to do in respect of their own (and
their connected persons') beneficial holdings of 2,107,579 Instem
Shares (representing, in aggregate, approximately 9.20 per cent. of
the Instem Shares in issue on 29 August 2023 (being the last
Business Day prior to this Announcement)).
Further details of these irrevocable undertakings are set out
below and in Appendix III to this Announcement.
4. Background to and reasons for the Acquisition
Instem is a market leading provider of workflow, data and IT
solutions across the drug development lifecycle to the global life
sciences market. As global R&D volume continues to increase,
Instem is well-placed to capitalise on the organic growth in the
number of users amongst existing clients as well as expand its
solutions product lines to reach new market users. Bidco is highly
enthused by the quality of Instem's market leading pre-clinical
solutions across its Study Management product modules, and is fully
aligned with the Instem management team's vision for Instem to
achieve its growth ambitions through both organic revenue growth
and targeted accretive M&A.
Bidco believes that Instem is better able to achieve its full
potential and continue transitioning customers from an on-premise
software delivery model to a SaaS based model in a private market
setting enabled by the acceleration of investment in technology and
growth. Bidco believes it would be able to leverage ARCHIMED's deep
industry knowledge as a healthcare specialist investor, extensive
network of industry specialists and additional financial resources
to accelerate Instem's growth strategy and support Instem's
management team.
Bidco believes that the Acquisition has a strong strategic
rationale, representing a highly compelling opportunity to enable
Instem to:
-- capitalise on operating leverage via its transition of its
market leading Study Management product offering from an on-premise
delivery model to a SaaS based model;
-- accelerate organic growth in its growing In Silico &
Translational Science and Clinical Trial Analytics business
segments by leveraging ARCHIMED's network and industry
experience;
-- deploy additional capital for accretive and value enhancing M&A opportunities;
-- continue the vision of Instem's highly experienced management team; and
-- augment Instem's position as a market-leader and trusted
partner to the global health and life sciences community across the
drug development lifecycle.
5. Background to and reasons for the recommendation
Since its initial public offering in 2010, Instem has undergone
substantial development across its operations, resulting in
significant growth and expansion of the business. Instem's
solutions are in use by over 700 customers worldwide, including the
largest 25 global pharmaceutical companies, enabling clients to
bring life enhancing products to market faster.
In 2010, Instem had revenue of GBP10.0 million and EBITDA of
GBP2.3 million. The Instem Board is proud of the incremental
revenue and profit growth that has followed, fuelled by innovation
and technology demand, leading to Instem reporting revenue of
GBP58.9 million and EBITDA of GBP10.9 million in 2022, driven by
increasing IT demand, innovation, product development, and
strategic integration of several complementary businesses.
Whilst the Instem Directors are highly confident in the
long-term prospects of the business as an independent listed
company, the Instem Board notes:
-- ARCHIMED's offer of 833 pence per Instem share followed the
Instem Directors having received and rejected a series of
unsolicited proposals from ARCHIMED, with the first approach made
in March 2023;
-- the Acquisition represents an attractive premium of 41 per
cent. to the Closing Price and 35 per cent. to the volume weighted
average price in the three months to 29 August 2023 (being the last
Business Day prior to this Announcement);
-- the Acquisition represents an attractive implied enterprise
value multiple of 18.3x EBITDA of GBP10.9 million for the year
ended 31 December 2022;
-- after careful consideration together with its advisers
Rothschild & Co and Singer Capital Markets, the Instem Board
believes that the Acquisition reflects the strength of the Instem
business today and its future prospects; and
-- while Instem has a strategy to deliver the next phase of
development for the business, this phase is at an early stage and
there is an element of risk attached to some of our recent
initiatives, which will take time to deliver value. ARCHIMED's
offer provides an opportunity for Instem Shareholders to receive a
full price and crystallise, in cash, the value of their
investments.
The Instem Directors also acknowledge the benefits of private
ownership, including greater access to capital to pursue new growth
opportunities, in particular creating the opportunity to build on
and accelerate Instem's successful track record of acquisitive
growth.
In considering the Acquisition, the Instem Directors have taken
into account ARCHIMED's stated intentions for the business and its
employees. The Instem Directors believe that the Acquisition
represents an opportunity which results in a positive outcome for
all its stakeholders, including customers, employees and
shareholders.
Accordingly, after careful consideration of the above factors,
the Instem Directors are pleased to confirm their intention to
recommend unanimously that Instem Shareholders vote in favour of
the Scheme at the Court Meeting (or in the event that the
Acquisition is implemented by way of a Takeover Offer, to accept or
procure acceptance of such Takeover Offer), as the Instem Directors
have committed to do in respect of their Instem Shares (where
applicable).
6. Conditions
The Acquisition is conditional, amongst other things, upon:
(a) the approval of the Scheme by a majority in number
representing not less than 75 per cent. in value of the Instem
Shareholders entitled to vote and present and voting, either in
person or by proxy, at the Court Meeting (or at any adjournment,
postponement or reconvention of such meeting) on or before the 22nd
day after the expected date of the Court Meeting to be set out in
the Scheme Document in due course (or such later date as may be
agreed between Bidco and Instem and the Court may allow);
(b) the passing of the Resolution by the requisite majority at
the General Meeting to be held on or before the 22nd day after the
expected date of the General Meeting to be set out in the Scheme
Document (or such later date, if any, as Bidco and Instem may agree
and the Court may allow); and
(c) satisfaction or waiver of the NSIA Condition.
The attention of Instem Shareholders is drawn to the fact that
the Acquisition is also conditional on other Conditions and certain
further terms set out in Appendix I and to the full terms and
conditions which will be set out in the Scheme Document.
The Scheme Document, along with the notice of the Court Meeting
and the General Meeting and the Forms of Proxy will be despatched
to Instem Shareholders within 28 days of the date of this
Announcement, unless Bidco and Instem otherwise agree, and the
Takeover Panel consents, to a later date.
7. Irrevocable undertakings
Bidco has received irrevocable undertakings to vote or procure
votes in favour of the Scheme at the Court Meeting and the
Resolution to be proposed at the General Meeting (or, subject to
the terms of the Co-operation Agreement and with the consent of the
Takeover Panel, if Bidco exercises its right to implement the
Acquisition by way of a Takeover Offer, to accept such offer) from
all of the Instem Directors who hold Instem Shares (in a personal
capacity or through a nominee or related family trust) in respect
of their (and their connected persons') entire beneficial holdings
of Instem Shares, amounting, in aggregate, to 2,107,579 Instem
Shares (representing, in aggregate, approximately 9.20 per cent. of
the Instem Shares in issue on 29 August 2023 (being the last
Business Day prior to this Announcement)).
Further details of these irrevocable undertakings (including
details of the circumstances in which they cease to be binding) are
set out in Appendix III to this Announcement.
8. Information on ARCHIMED and Bidco
Bidco
Bidco is a newly incorporated company controlled by funds
managed by ARCHIMED. Bidco was formed for the purposes of the
Acquisition and has not traded prior to the date of this
Announcement nor has it entered into any obligation other than in
connection with the Acquisition.
ARCHIMED
With offices in Europe, North America and Asia, ARCHIMED is a
leading global investment firm that is exclusively focused on
healthcare industries, with more than EUR8 billion of assets under
management and past and current investments in 32 healthcare
companies that serve customers around the world. Over the last
twenty years, ARCHIMED's leadership team has directly managed and
invested in over eighty small to large size healthcare companies
globally, representing over EUR30 billion of combined value.
ARCHIMED specialises in investing in operating companies across
various segments of the healthcare industry, including Health Tech
and Software, Biologic Services, Biopharma Products, In Vitro
Diagnostics, Med Tech, Pharma Services and Consumer Health. Its mix
of operational, medical, scientific and financial expertise allows
ARCHIMED to serve as both a strategic and financial partner to
North American and European healthcare businesses. ARCHIMED's
specialisation in healthcare industries also enables it to develop
a deep understanding of the unique challenges and opportunities for
healthcare businesses and leverage its network of healthcare
talents to support its portfolio companies.
Since inception, ARCHIMED has raised five main funds and made
investments ranging from EUR10 million to EUR1 billion. It has been
particularly focused on providing its companies with the strategic,
operational and financial resources required to facilitate the
companies' efforts in innovation, internationalisation, capacity
increase, product range expansion and acquisitions.
9. Information on Instem
Instem is a leading provider of IT solutions and services to the
life sciences market for Study Management, Regulatory Submissions,
Clinical Trial Analytics and Informatics-based Insight Generation.
The Instem Group's suite of software solutions and services enables
its clients to accelerate the process of bringing life-enhancing
products to market, delivering increased client productivity by
automating study-related processes whilst at the same time
generating new knowledge through the extraction and harmonisation
of actionable scientific information. Instem's offering has been
purposefully positioned such that it now covers aspects of the
entire drug development value chain, from discovery through to
market launch.
Instem has over 700 customer relationships, covering the leading
pharmaceutical, chemical and contract research organisations as
well as academic, government and privately funded research
institutions across many locations worldwide. The Instem Group's
recurring customers include the top 25 pharmaceutical and biotech
companies globally such as GlaxoSmithKline and AstraZeneca.
The Instem Group has in recent years grown organically and by
acquisition. Notable recent developments include the acquisitions
in 2021 of d-Wise Technologies, Inc, a US-based provider of
clinical trial technology and consultancy services, The Edge
Software Consultancy Ltd, a UK-based provider of drug discovery
software solutions and PDS Pathology Data Systems Ltd, a
Switzerland-based provider of software to the life sciences
industry for non-clinical study management and outsourced services
for regulatory submissions.
In May 2023, Instem announced that it had been granted exclusive
rights to transition the ToxHub Platform (the "Platform") from
eTRANSAFE, a consortium of 13 international life sciences
companies. Instem plans to commercialise the Platform, which has
been designed to speed up the development of medicines. The
Platform will be integrated into its Centrus(R) software suite
(previously branded in silico) which provides data sharing,
predictive modelling and insight generation for the drug discovery
and development process. Instem also announced in May 2023 that it
had received its first SaaS subscription order for the Platform
from Bayer AG, a member of the eTRANSAFE consortium.
Instem's European headquarters and registered office is located
in Staffordshire in the UK, with its North American headquarters in
Philadelphia in the USA. Instem also has other offices in the UK,
USA as well as a presence in China, India, Japan, France, Romania
and Switzerland. Instem's average monthly number of employees was
493 in FY22. Instem Limited, the original Instem business, was
founded in 1969 and Instem's ordinary shares were admitted to
trading on AIM in 2010.
Recent financial performance
On 15 August 2023, Instem announced the following trading update
for the six months ended 30 June 2023 ("H1 FY2023"):
" Financial Highlights
Revenue for H1 2023 is expected to be in the region of GBP29.7m
(H1 2022: GBP27.0m), an increase of approximately 10.2%, with
recurring software revenue growing by 27%. This excludes Samarind
Limited, which was sold on 1 April 2023 and will be classified as a
discontinued operation in the H1 2023 results statement. Annual
Recurring Revenue ("ARR") at 1 July 2023 was c.GBP41m (1 July 2022:
GBP32m). Overall performance was broadly in line with management
expectations.
Closing cash at 30 June 2023 was GBP8.4m (30 June 2022:
GBP10.3m), after GBP5.8m of deferred consideration paid in H1 2023
in relation to certain of the Company's previous acquisitions. The
Group's balance sheet remains strong, retaining the flexibility to
execute on acquisition opportunities as they arise. The Board is
currently appraising a healthy pipeline of opportunities progressed
to various stages.
Operational Highlights
The Company commenced the next phase of its development,
positioning itself at the forefront of the growing Artificial
Intelligence ("AI") opportunity with an increased focus on in
silico solutions as part of a blended growth strategy, building on
the relationships and fundamentals of the established business.
The transfer of the ToxHub Platform (the "Platform") and launch
of Centrus(R) announced in May 2023 enables existing and new
clients to utilise a single repository from which to unlock new
knowledge through the application and deployment of cutting-edge
algorithms.
The Company also renewed its long-standing agreement with the
National Toxicology Program ("NTP"), run by the US National
Institute of Environmental Health Sciences ("NIEHS") during the
period - providing further potential for Instem to broaden its in
silico presence. The size and scale of this extension underpins
increased revenue visibility.
Post period end, the Company grew its Provantis footprint
further, with Altasciences signing a three-year subscription order
worth $3.1m. This follows the acquisitions of Calvert Labs and
Sinclair Research by Altasciences and the subsequent decision to
standardise on Provantis and to transition from on-premises
deployment to Instem's cloud-based solutions, increasing its
Provantis user licences from 250 to more than 600.
Outlook
The Company remains optimistic about the growth potential having
positioned itself to provide solutions across the entire drug
discovery and development life cycle. The in silico growth
opportunity, in particular, is expected to increase as the Company
addresses the pressing market need to reduce the cost and time of
life sciences research and development, leveraging the integration
of "Toxhub" data and technology into its existing Centrus
suite.
As in 2022, it is expected that revenue growth will be second
half weighted benefitting from increased software recurring
revenue, predominantly from new business already secured and the
reliable renewal of contracts with current clients.
With an increasing number of customer touch points and cross
selling opportunities management is confident that Instem's
performance will be broadly in line with the Board's expectations
for the full year.
Phil Reason, Instem CEO, commented: "We are delighted with the
continued momentum we are seeing, advocating our acquisition
strategy and highlighting our standing across the drug research and
development lifecycle. We believe there is significant potential to
continue driving value and look forward to building on the
Company's growing market reach.""
10. Management, employees, pensions, research and development
and locations of the Instem Group
Strategic plans for Instem
As set out in paragraph 4 above, Bidco believes that the
Acquisition has a compelling strategic rationale.
Bidco believes it is well-suited to accelerate Instem's growth
as a trusted solutions provider and partner to healthcare industry
customers. Bidco will provide Instem with the strategic, tactical
and financial resources required to support the management team's
efforts in accelerating their efforts in exploring organic growth
opportunities including expanding its existing product range and
improving operating margin.
Bidco plans to assess opportunities to make accretive and value
enhancing acquisitions, with an aim to expand the scope and scale
of Instem's service o ering. Bidco intends to assist Instem's
management in identifying, evaluating and nancing the acquisitions
of complementary companies, as well as accelerating investment in
organic growth prospects to further support Instem's expansion.
Employees and management
Bidco attaches great value to the skills, experience and
commitment of the existing Instem management and employees and
believes that they will be fundamental in maximising the long term
success of Instem. Bidco is committed to fully support management
in continuing to execute their strategic and growth vision, notably
the recently announced re-organisation of Instem into 3 strategic
Business Units: Study Management, In Silico & Translational
Science and Clinical Trial Analytics.
Once Instem ceases to be a listed company, a limited number of
public company-related functions may be reduced in scope or become
unnecessary. No proposals have been developed yet as to how any
such headcount reductions will be implemented but Bidco intends to
work with Instem's management to identify after the date of this
announcement how individuals in affected roles may be reassigned to
other appropriate roles within Instem prior to or with effect from
the Scheme becoming Effective. Bidco intends to support any steps
taken by Instem management to reassign individuals appropriately,
and confirms that the intention is for any individuals impacted to
be treated in a manner consistent with Instem's high standards and
culture and that Bidco will observe Instem's existing redundancy
practices and policies, including undertaking appropriate
consultation with affected employees.
The board of Bidco confirms that, upon the Scheme becoming
Effective, the existing contractual and statutory employment
rights, including pension rights, of all management and employees
of the Instem Group will be fully safeguarded.
Upon the Scheme becoming Effective, the non-executive directors
of Instem will resign and from that point will cease to be
directors of Instem.
Existing rights and pension schemes
Bidco confirms that, following completion of the Acquisition,
the existing statutory and contractual rights and terms and
conditions of employment of management and employees of Instem
Group, including in relation to pensions, will be fully safeguarded
in accordance with applicable law. Bidco has no intention to make
any material modifications to the conditions of employment of
management or employees of Instem Group or in the balance of their
skills and functions, unless otherwise agreed upon with the
respective employees. Bidco does not intend to make any changes to
the funding arrangements in relation to Instem's legacy defined
benefit pension scheme (which is closed to new members) . The
defined benefit scheme operated by Instem is closed to future
accrual of benefits. There are no plans to make any changes to any
defined contribution scheme(s) operated by Instem.
Incentivisation and retention arrangements
Bidco believes that the ongoing participation of senior
management of the Instem Group is very important to the future
success of the Instem Group. No discussions in relation to
incentivisation arrangements have yet taken place and no
discussions are expected to take place prior to completion of the
Acquisition, but Bidco intends to put in place appropriate
arrangements for selected members of senior management of the
Instem Group following completion of the Acquisition.
Location of business, fixed assets and headquarters; research
and development
Bidco has no plans to change the locations of business or the
headquarters of Instem beyond any ordinary course changes planned
by the current management of Instem. Bidco does not intend to
redeploy the fixed assets of Instem. Bidco has no intention to make
any changes to Instem's research and development function.
Trading Facilities
The Instem Shares are admitted to trading on the London Stock
Exchange's AIM market. As set out in paragraph 15, it is intended
that an application will be made for the cancellation of trading of
the Instem Shares on the London Stock Exchange's AIM market to take
effect on or shortly after the Effective Date.
It is intended that Instem be re-registered as a private limited
company on, or as soon as practicable following, the Effective
Date.
Statements
No statements in this paragraph 10 constitute "post-offer
undertakings" for the purposes of Rule 19.5 of the Code.
11. Financing
The cash consideration payable to the Instem Shareholders under
the terms of the Acquisition is intended to be financed by indirect
capital contributions to Bidco to be invested by (i) MED Platform
II S.L.P. and (ii) MED Platform II B FPCI (in connection with which
an equity commitment letter has been entered into with Bidco).
Moelis, in its capacity as financial adviser to Bidco, is
satisfied that sufficient resources are available to Bidco to
enable it to satisfy in full the cash consideration payable to
Instem Shareholders under the terms of the Acquisition.
Further information on the financing of the Acquisition will be
set out in the Scheme Document.
12. Offer-related arrangements
Confidentiality Agreement
ARCHIMED and Instem entered into a confidentiality agreement
dated 7 June 2023 pursuant to which, amongst other things, ARCHIMED
has undertaken to: (a) subject to certain exceptions, keep
confidential information relating to Instem confidential and not to
disclose it to third parties; and (b) use such confidential
information only in connection with the Acquisition. The
confidentiality obligations remain in force notwithstanding
termination of discussions relating to the Acquisition. The
Confidentiality Agreement further includes standstill obligations
which restricted ARCHIMED from acquiring or offering to acquire
interest in certain securities of Instem; those restrictions ceased
to apply on the making of this Announcement.
Co-operation Agreement
Bidco and Instem entered into a co-operation agreement on or
around the date of this Announcement (the "Co-operation Agreement")
in connection with the Acquisition.
Pursuant to the Co-operation Agreement, each of Bidco and Instem
has agreed to co-operate with each other for the purposes of
obtaining all regulatory approvals and preparing the Scheme
Document. The Co-operation Agreement also contains certain
provisions regarding a switch to implement the Acquisition by way
of a Takeover Offer.
The Co-operation Agreement will terminate, amongst other things:
(i) if it is agreed in writing between Bidco and Instem at any time
prior to the Effective Date; (ii) upon service of written notice by
Bidco to Instem if (amongst other things) certain changes have
occurred in relation to the Instem Board's recommendation of the
Acquisition; or (iii) upon service of written notice by Bidco to
Instem or Instem to Bidco if (amongst other things) the Acquisition
(whether implemented by way of a Scheme or a Takeover Offer)
lapses, terminates or is withdrawn on or prior to the Long Stop
Date (other than in certain circumstances including a switch to a
Takeover Offer agreed between Bidco and Instem) or, if the Scheme
is not approved by the requisite majority of the holders of the
Scheme Shares at the Court Meeting and/or Instem Shareholders at
the General Meeting or the Court refuses to sanction the
Scheme.
The Co-operation Agreement also contains provisions that will
apply in respect of certain employee-related matters and the Instem
Share Plans.
Clean Team Agreement
Bidco and Instem entered into a clean team agreement on 24
August 2023 (the "Clean Team Agreement"). The purpose of the Clean
Team Agreement is to provide for a "clean team" protocol to
facilitate the provision by Instem of confidential information to
Bidco's external legal adviser for the purposes of assessing the
regulatory approvals required in connection with the
Acquisition.
13. Structure of the Acquisition
Scheme
It is intended that the Acquisition will be effected by a scheme
of arrangement between Instem and the Scheme Shareholders under
Part 26 of the Companies Act (although Bidco reserves the right to
effect the Acquisition by way of a Takeover Offer, subject to the
consent of the Takeover Panel and the terms of the Co-operation
Agreement). The purpose of the Scheme is to provide for Bidco to
acquire the whole of the issued and to be issued share capital of
Instem. Under the Scheme, the Acquisition is to be achieved by the
transfer of the Scheme Shares held by Scheme Shareholders to Bidco
in consideration for which the Scheme Shareholders will receive
cash consideration pursuant to the Scheme .
Approval by Court Meeting and General Meeting
To become Effective, the Scheme requires, amongst other
things:
(a) approval of a majority in number of the Instem Shareholders
present and voting (and entitled to vote) at the Court Meeting,
either in person or by proxy, representing not less than 75 per
cent. in value of the Scheme Shares voted by those Instem
Shareholders at the Court Meeting; and
(b) approval by the requisite majority of the Resolution at the
General Meeting (to be held directly after the Court Meeting)
necessary in order to implement the Scheme.
Application to Court to sanction the Scheme
Once the approvals have been obtained at the Court Meeting and
the General Meeting and the other Conditions have been satisfied or
(where applicable) waived, the Scheme must be sanctioned by the
Court at the Sanction Hearing before it can become Effective.
The Scheme will become Effective in accordance with its terms on
delivery of the Court Order to the Registrar of Companies. Upon the
Scheme becoming Effective, it will be binding on all Scheme
Shareholders, irrespective of whether or not they attended or voted
at the Court Meeting or General Meeting, or whether they voted in
favour of or against the Scheme.
The Scheme will contain a provision for Bidco and Instem jointly
to consent, on behalf of all persons concerned, to any modification
of or addition to the Scheme or to any condition that the Court may
approve or impose. Instem has been advised that the Court would be
unlikely to approve any modification of, or addition to, or impose
a condition to the Scheme which might be material to the interests
of Scheme Shareholders unless Scheme Shareholders were informed of
such modification, addition or condition. It would be a matter for
the Court to decide, in its discretion, whether or not a further
meeting of the Instem Shareholders should be held in these
circumstances.
Full details of the Scheme to be set out in the Scheme
Document
The Scheme Document will include full details of the Scheme,
including the expected timetable and the action to be taken by
Scheme Shareholders. The Scheme will be governed by English law.
The Scheme will be subject to the applicable requirements of the
Code, the Takeover Panel, the AIM Rules, the London Stock Exchange
and the FCA.
The Scheme Document, along with the notice of the Court Meeting
and the General Meeting and the Forms of Proxy will be despatched
to Instem Shareholders within 28 days of the date of this
Announcement, unless Bidco and Instem otherwise agree, and the
Takeover Panel consents, to a later date. Subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions, the Scheme Document will also be made available on
Instem's website at https://investors.instem.com and on Bidco's
website at www.Ichor-offer.com.
At this stage, subject to the satisfaction or waiver of the
Conditions and certain further terms set out in Appendix I, Bidco
and Instem expect the Acquisition to become Effective during the
fourth quarter of 2023.
If the Scheme does not become Effective on or before the Long
Stop Date (or such later date as Bidco and Instem may, with the
consent of the Takeover Panel and, if required, the Court, agree)
it will lapse and the Acquisition will not proceed (unless the
Takeover Panel otherwise consents).
Right to switch to a Takeover Offer
Subject to the terms of the Co-operation Agreement, Bidco
reserves the right to elect, with the consent of the Takeover
Panel, to implement the Acquisition by way of a Takeover Offer for
the entire issued and to be issued ordinary share capital of Instem
as an alternative to the Scheme. In such an event, the Takeover
Offer will be made in accordance with the terms and conditions set
out in this Announcement which would apply to the Scheme (with any
modifications or amendments to such terms and conditions as may be
required by the Takeover Panel or which are necessary as a result
of Bidco's election to implement the Acquisition by way of a
Takeover Offer), in accordance with the Co-operation Agreement and
subject to the amendment referred to in Appendix I to this
Announcement.
14. Instem Share Plans
Participants in the Instem Share Plans will be contacted
regarding the effect of the Acquisition on their rights under the
Instem Share Plans and, where relevant, an appropriate proposal
will be made to such participants pursuant to Rule 15 of the Code
in due course. Further details of the impact of the Acquisition on
each of the Instem Share Plans will be set out in the Scheme
Document.
Upon or following the date of this Announcement, Instem intends
to make certain further grants of options under the Instem plc 2018
Long Term Incentive Plan, over a total of 505,837 Instem
Shares.
15. De-listing and re-registration
It is intended that an application will be made to the London
Stock Exchange to cancel trading of the Instem Shares on AIM on or
shortly after the Effective Date. The last day of dealings in, and
registration of transfers of, Instem Shares on AIM is expected to
be the Business Day immediately prior to the Effective Date and no
transfers will be registered after 6.00 p.m. on that date.
Upon the Scheme becoming Effective, share certificates in
respect of the Instem Shares will cease to be valid and should be
destroyed. In addition, entitlements to Instem Shares held within
the CREST system will be cancelled on the Effective Date.
As soon as practicable after the Effective Date, it is intended
that Instem will be re-registered as a private limited company
under the relevant provisions of the Companies Act.
16. Disclosure of interests in Instem
As at the close of business on 29 August 2023, being the last
Business Day prior to this Announcement, save for the irrevocable
undertakings referred to in paragraphs 3 (Recommendation) and 7
(Irrevocable undertakings) above, so far as Bidco is aware, no
person acting, or deemed to be acting, in concert with Bidco:
(a) had an interest in, or right to subscribe for, relevant securities of Instem;
(b) had any short position in (whether conditional or absolute
and whether in the money or otherwise), including any short
position under a derivative, any agreement to sell or any delivery
obligation or right to require another person to purchase or take
delivery of, relevant securities of Instem;
(c) had procured an irrevocable commitment or letters of intent
to accept the terms of the Acquisition in respect of relevant
securities of Instem; or
(d) had borrowed or lent any Instem Shares (including, for these
purposes, any financial collateral arrangements of the kind
referred to in Note 4 to Rule 4.6 of the Code).
Furthermore, save for the irrevocable undertakings described in
paragraph 7 (Irrevocable undertakings) above, no arrangement exists
between Bidco or Instem or a person acting in concert with Bidco or
Instem in relation to Instem Shares. For these purposes, an
"arrangement" includes any indemnity or option arrangement, any
agreement or any understanding, formal or informal, of whatever
nature, relating to Instem Shares which may be an inducement to
deal or refrain from dealing in such securities.
Bidco is not aware of any dealings in Instem Shares that would
require a minimum level, or particular form of consideration that
it would be obliged to offer under Rule 6 or Rule 11 of the Code
(as appropriate). However, it has not been practicable for Bidco to
make enquiries of all of its concert parties in advance of the
release of this Announcement. In accordance with Note 4 on Rule 2.4
of the Code, any such details shall be announced as soon as
practicable and in any event by no later than the time Bidco is
required to make its Opening Position Disclosure pursuant to Rule
8.1 of the Code.
17. Documents on display
Copies of this Announcement and the following documents will, by
no later than 12 noon on the Business Day following the date of
this Announcement, be made available on Instem's website at
https://investors.instem.com and on Bidco's website at
www.Ichor-offer.com until the end of the Offer Period:
-- this Announcement;
-- the Confidentiality Agreement;
-- the irrevocable undertakings referred to in paragraph 7 above;
-- the Co-operation Agreement;
-- the Clean Team Agreement;
-- the documents entered into in relation to the financing of
the Acquisition referred to in paragraph 11 above; and
-- the consent letters from each of Rothschild & Co, Singer Capital Markets and Moelis.
18. General
The Acquisition will be subject to the Conditions and certain
further terms set out in Appendix I and to the full terms and
conditions which will be set out in the Scheme Document. The Scheme
Document, along with the notice of the Court Meeting and the
General Meeting and the Forms of Proxy will be despatched to Instem
Shareholders within 28 days of the date of this Announcement, (or
by such later date as Bidco and Instem may agree, with the consent
of the Takeover Panel).
In deciding whether or not to vote or procure votes in favour of
the Scheme at the Court Meeting and the Resolution to be proposed
at the General Meeting, Instem Shareholders should rely on the
information contained, and follow the procedures described, in the
Scheme Document.
Rothschild & Co, Singer Capital Markets and Moelis have each
given and not withdrawn their consent to the inclusion in this
Announcement of the references to their names in the form and
context in which they appear.
Appendix II contains details of sources of information and bases
of calculation contained in this Announcement. Appendix III
contains certain details relating to the irrevocable undertakings
referred to in this Announcement. Appendix IV contains definitions
of certain terms used in this Announcement.
Enquiries:
Instem
Phil Reason Via Walbrook
Nigel Goldsmith
Rothschild & Co (Financial Adviser to Instem)
Alistair Allen Tel: +44 (0) 161 827 3800
Julian Hudson
Tom Palmer
Singer Capital Markets Advisory LLP (Nominated Adviser, Joint
Financial Adviser and Joint Broker to Instem)
Peter Steel Tel: +44 (0) 20 7496 3000
Alex Bond
Oliver Platts
Stifel Nicolaus Europe Limited (Joint Broker to Instem)
Ben Maddison Tel: +44 (0) 20 7710 7600
Richard Short
Walbrook Financial PR (Public Relations Adviser to Instem)
Tom Cooper Tel: +44 (0) 20 7933 8780
Nick Rome
Joe Walker
ARCHIMED SAS
Vincent Guillaumot Tel: +33 4 81 11 35 33
Brian Sheridan
Sandrine Laporte
Moelis & Company UK LLP (Financial Adviser to ARCHIMED and
Bidco)
Philippe Gallone Tel: +44 (0) 20 7634 3500
Chris Raff
François Saint-Lo
Simon Chaudhuri
Latham & Watkins (London) LLP are retained as legal adviser
to ARCHIMED and Bidco.
Squire Patton Boggs (UK) LLP are retained as legal adviser to
Instem.
Disclaimers
Rothschild & Co , which is authorised and regulated by the
FCA in the United Kingdom, is acting exclusively as financial
adviser to Instem and for no one else in connection with the
matters set out in this Announcement and will not be responsible to
anyone other than Instem for providing the protections afforded to
clients of Rothschild & Co, nor for providing advice in
relation to the Acquisition or any other matters referred to in
this Announcement. Neither Rothschild & Co nor any of its
subsidiaries, branches or affiliates (nor their respective
directors, officers, employees or agents) 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 who is not a client of Rothschild & Co in connection
with this Announcement, any statement contained in this
Announcement, the Acquisition or otherwise. No representation or
warranty, express or implied, is made by Rothschild & Co as to
the contents of this Announcement .
Singer Capital Markets Advisory LLP, which is authorised and
regulated by the FCA in the United Kingdom, is acting exclusively
for Instem and no-one else in connection with the subject matter of
this Announcement and will not be responsible to anyone other than
Instem for providing the protections afforded to clients of Singer
Capital Markets nor for providing advice in connection with the
subject matter of this Announcement. Neither Singer Capital Markets
nor any of its affiliates (nor any of their respective directors,
partners, officers, employees or agents) 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 who is not a client of Singer Capital Markets in connection
with this Announcement, any statement contained herein, the
Acquisition or otherwise. No representation or warranty, express or
implied, is made by Singer Capital Markets as to the contents of
this Announcement.
Moelis & Company UK LLP ("Moelis"), which is regulated by
the FCA in the United Kingdom, is acting exclusively for ARCHIMED
and Bidco and no one else in connection with the Acquisition and
other matters set out in this Announcement and will not be
responsible to anyone other than ARCHIMED and Bidco for providing
the protections afforded to clients of Moelis, or for providing
advice in connection with the Acquisition or any matter referred to
herein. Neither Moelis nor any of its affiliates 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 who is not a client of Moelis in connection with this
Announcement, any statement contained herein or otherwise.
Further information
This Announcement is for information purposes only and is not
intended to and does not constitute, or form any part of, an offer
to sell or subscribe for or any invitation to purchase or subscribe
for any securities or the solicitation of any vote or approval in
any jurisdiction pursuant to the Acquisition or otherwise. The
Acquisition will be made solely through and on the terms set out in
the Scheme Document (or, in the event that the Acquisition is to be
implemented by means of a Takeover Offer, the Offer Document) and
the accompanying Forms of Proxy, which will contain the full terms
and conditions of the Acquisition, including details of how to vote
in respect of the Acquisition. Any vote, approval, decision or
other response to the Acquisition should be made only on the basis
of the information in the Scheme Document (or, if the Acquisition
is implemented by way of a Takeover Offer, the Offer Document) .
Scheme Shareholders are strongly advised to read the formal
documentation in relation to the Acquisition once it has been
despatched.
This Announcement does not constitute a prospectus or a
prospectus exempted document.
The statements contained in this Announcement are made as at the
date of this Announcement, unless some other time is specified in
relation to them, and service of this Announcement shall not give
rise to any implication that there has been no change in the facts
set forth in this Announcement since such date.
Overseas shareholders
This Announcement has been prepared for the purpose of complying
with English law, the AIM Rules and the Code and the information
disclosed may not be the same as that which would have been
disclosed if this Announcement had been prepared in accordance with
the laws of jurisdictions outside the United Kingdom.
The laws of the relevant jurisdictions may affect the
availability of the Acquisition to persons who are not resident in
the United Kingdom . Persons who are not resident in the United
Kingdom, or who are subject to laws of any jurisdiction other than
the United Kingdom, should inform themselves about, and observe any
applicable requirements. Any person (including, without limitation,
nominees, trustees and custodians) who would, or otherwise intends
to, forward this Announcement, the Scheme Document or any
accompanying document to any jurisdiction outside the United
Kingdom should refrain from doing so and seek appropriate
professional advice before taking any action. In particular, the
ability of persons who are not resident in the United Kingdom to
vote their Instem Shares at the Court Meeting or the General
Meeting, or to execute and deliver Forms of Proxy appointing
another to vote their Instem Shares in respect of the Court Meeting
or the General Meeting on their behalf, may be affected by the laws
of the relevant jurisdiction in which they are located.
Any failure to comply with the applicable legal or regulatory
requirements may constitute a violation of the laws and/or
regulations of any such jurisdiction . To the fullest extent
permitted by applicable law, the companies and persons involved in
the Acquisition disclaim any responsibility and liability for the
violation of such restrictions by any person.
The Acquisition will not be made, directly or indirectly, in or
into or by use of the mails or any other means or instrumentality
(including, without limitation, telephonic or electronic) of
interstate or foreign commerce of, or any facility of a national,
state or other securities exchange of, a Restricted Jurisdiction,
and the Acquisition will not be capable of acceptance by any such
use, means, instrumentality or facility or from within a Restricted
Jurisdiction . Accordingly, copies of this Announcement and formal
documentation relating to the Acquisition are not being, and must
not be, directly or indirectly, mailed or otherwise forwarded or
distributed in, into or from a Restricted Jurisdiction and persons
receiving this Announcement (including custodians, nominees and
trustees) must not distribute or send it into or from a Restricted
Jurisdiction. In the event that the Acquisition is implemented by
way of a Takeover Offer and extended into the US, Bidco will do so
in satisfaction of the procedural and filing requirements of US
securities laws at that time, to the extent applicable thereto. The
Acquisition relates to the shares of a company incorporated in
England and it is proposed to be made by means of a scheme of
arrangement provided for under English law. The Scheme will relate
to the shares of a UK company that is a "foreign private issuer" as
defined under Rule 3b-4 under the US Exchange Act. A transaction
effected by means of a scheme of arrangement is not subject to any
shareholder vote, proxy solicitation and tender offer rules under
the US Exchange Act. Accordingly, the Scheme is subject to the
disclosure requirements and practices applicable in the UK to
schemes of arrangement, which differ from the disclosure
requirements and practices of US shareholder vote, proxy
solicitation or tender offer rules. Financial information included
in the relevant documentation will have been prepared in accordance
with accounting standards applicable in the UK and may not be
comparable to the financial information of, or the accounting
standards applicable to, US companies. However, if Bidco were to
elect to implement the Acquisition by means of a Takeover Offer,
such Takeover Offer shall be made in compliance with all applicable
laws and regulations, including section 14(e) of the US Exchange
Act and Regulation 14E thereunder, if applicable. Such Takeover
Offer would be made in the US by Bidco and no one else. In addition
to any such Takeover Offer, Bidco, certain affiliated companies and
the nominees or brokers (acting as agents) may make certain
purchases of, or arrangements to purchase, shares in Instem outside
such Takeover Offer during the period in which such Takeover Offer
would remain open for acceptance. If such purchases or arrangements
to purchase are made they would be made outside the United States
in compliance with applicable law, including the US Exchange Act.
It may be difficult for a US-based investor to enforce his or her
rights and any claim he or she may have arising under US securities
laws, since the Scheme relates to the shares of a company located
in the UK, and some or all of its officers and directors may be
residents of non-US jurisdictions. A US-based investor may not be
able to sue a company located in the UK, or its officers or
directors, in a foreign court for alleged violations of US
securities laws, and it may be difficult to compel a foreign
company and its affiliates to subject themselves to a US court's
judgment.
Forward-looking statements
This Announcement, oral statements made regarding the
Acquisition, and other information published by Instem, Bidco and
ARCHIMED may contain certain "forward-looking statements" with
respect to Instem, Bidco and ARCHIMED. 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", "will", "may",
"should", "would", "could" or other words or terms of similar
meaning or the negative thereof. Forward-looking statements include
statements relating to, for example, the following: (i) future
capital expenditures, expenses, revenues, earnings, synergies,
economic performance, indebtedness, financial condition, dividend
policy, losses and future prospects; (ii) business and management
strategies of ARCHIMED and/or Bidco and the expansion and growth of
Instem and potential synergies resulting from the Acquisition; and
(iii) the effects of government regulation on the business of
Instem.
These forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause actual
results, performance or developments to differ materially from
those expressed in or implied by such forward-looking statements.
These forward-looking statements are based on numerous assumptions
regarding present and future strategies and environments. None of
ARCHIMED, Bidco or Instem, nor any of their respective associates,
directors, officers, employees or advisers, provides any
representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward-looking statements in
this Announcement will actually occur. You are cautioned not to
place undue reliance on such forward-looking statements, which
speak only as of the date hereof. All subsequent oral or written
forward-looking statements attributable to ARCHIMED, Bidco or
Instem or any person acting on their behalf are expressly qualified
in their entirety by the cautionary statement above. Should one or
more of these risks or uncertainties materialise, or should
underlying assumptions prove incorrect, actual results may vary
materially from those described in this Announcement. None of
ARCHIMED, Bidco or Instem assume any obligation to update publicly
or revise forward-looking or other statements contained in this
Announcement, whether as a result of new information, future events
or otherwise, except to the extent legally required.
No profit forecasts or estimates
No statement in this Announcement is intended as a profit
forecast or estimate for ARCHIMED, Bidco or Instem in respect of
any period and no statement in this Announcement should be
interpreted to mean that earnings or earnings per Instem Share for
the current or future financial years would necessarily match or
exceed the historical published earnings or earnings per Instem
Share.
Right to switch to a Takeover Offer
Subject to the terms of the Co-operation Agreement, Bidco
reserves the right to elect, with the consent of the Takeover
Panel, to implement the Acquisition by way of a Takeover Offer for
the entire issued and to be issued ordinary share capital of Instem
as an alternative to the Scheme. In such an event, the Takeover
Offer will be made in accordance with the terms and conditions set
out in this Announcement which would apply to the Scheme (with any
modifications or amendments to such terms and conditions as may be
required by the Takeover Panel or which are necessary as a result
of Bidco's election to implement the Acquisition by way of a
Takeover Offer), in accordance with the Co-operation Agreement and
subject to the amendment referred to in Appendix I to this
Announcement.
Publication on website
In accordance with Rule 26.1 of the Code, a copy of this
Announcement will be made available (subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions), free of charge, on Instem's website at
https://investors.instem.com and on Bidco's website at
www.Ichor-offer.com by no later than 12:00 noon on the Business Day
following this Announcement. Neither the contents of this website
nor the content of any other website accessible from hyperlinks on
such websites is incorporated into, or forms part of, this
Announcement.
Requesting hard copies
In accordance with Rule 30.3 of the Code, a person so entitled
may request a hard copy of this Announcement, free of charge, by
contacting Instem's registrar, Computershare Investor Services PLC
during business hours (8.30 a.m. to 5.30 p.m.) on +44 (0)370 703
6041 or by submitting a request in writing to Computershare
Investor Services PLC at The Pavilions, Bridgwater Road, Bristol,
BS13 8AE. For persons who receive a copy of this Announcement in
electronic form or via a website notification, a hard copy of this
Announcement will not be sent unless so requested. In accordance
with Rule 30.3 of the Code, a person so entitled may also request
that all future documents, announcements and information to be sent
to them in relation to the Acquisition should be in hard copy
form.
Electronic communications - information for Instem
Shareholders
Please be aware that addresses, electronic addresses and certain
information provided by Instem Shareholders, persons with
information rights and other relevant persons for the receipt of
communications from Instem may be provided to Bidco during the
Offer Period as required under section 4 of Appendix 4 of the Code
to comply with Rule 2.11(c) of the Code.
Rounding
Certain figures included in this Announcement have been
subjected to rounding adjustments. Accordingly, figures shown for
the same category presented in different tables may vary slightly
and figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures that precede them.
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 Instem 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) Instem 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 p.m. (London time) on
the 10th Business Day following the commencement of the Offer
Period and, if appropriate, by no later than 3.30 p.m. (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 Instem 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 Instem or of any securities exchange offeror must
make a Dealing Disclosure if the person deals in any relevant
securities of Instem 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) Instem and
(ii) any securities exchange offeror, 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 p.m. (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 Instem 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 Instem and by
any offeror, and Dealing Disclosures must also be made by Instem,
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.
Rule 2.9 of the Code
For the purposes of Rule 2.9 of the Code, Instem confirms that,
as at the date of this Announcement, it had in issue 22,899,433
ordinary shares of 10 pence each. No shares are held in treasury.
The ISIN for the ordinary shares is GB00B3TQCK30.
General
If you are in any doubt about the contents of this Announcement
or the action you should take, you are recommended to seek your own
independent financial advice immediately from your stockbroker,
bank manager, solicitor or independent financial adviser duly
authorised under FSMA if you are resident in the United Kingdom or,
if not, from another appropriate authorised independent financial
adviser.
APPIX I
CONDITIONS OF THE ACQUISITION AND CERTAIN FURTHER TERMS
Part A: Conditions of the Scheme and the Acquisition
1. The Acquisition is conditional upon the Scheme becoming
unconditional and effective, subject to the Code, by not later than
11:59 p.m. on the Long Stop Date .
2. The Scheme shall be subject to the following conditions:
(a) (i) its approval by a majority in number of the Instem
Shareholders who are on the register of members of Instem at the
Voting Record Time and who are present and vote, whether in person
or by proxy, at the Court Meeting (and at any separate class
meeting which may be required by the Court) and who represent 75
per cent. in value of the Instem Shares voted by those Instem
Shareholders, and (ii) such Court Meeting (and any separate class
meeting which may be required) being held on or before the 22nd day
after the expected date of the Court Meeting to be set out in the
Scheme Document (or such later date, if any, as Bidco and Instem
may agree and the Court may allow);
(b) (i) the passing of the Resolution necessary in order to
implement the Scheme by the requisite majority at the General
Meeting (or any adjournment thereof), and (ii) such General Meeting
being held on or before the 22nd day after the expected date of the
General Meeting to be set out in the Scheme Document (or such later
date, if any, as Bidco and Instem may agree and the Court may
allow);
(c) (i) the sanction of the Scheme by the Court (with or without
modification but subject to any modification being on terms
acceptable to Bidco and Instem), and (ii) the Sanction Hearing
being held on or before the 22nd day after the expected date of the
Sanction Hearing to be set out in the Scheme Document (or such
later date, if any, as Bidco and Instem may agree and the Court may
allow); and
(d) delivery of a copy of the Court Order to the Registrar of Companies.
3. In addition, subject as stated in Part B below and to the
requirements of the Takeover Panel, the Acquisition shall be
conditional upon the following Conditions and, accordingly, the
Court Order shall not be delivered to the Registrar of Companies
unless such Conditions (as amended, if appropriate) have been
satisfied (and continue to be satisfied pending the commencement of
the Sanction Hearing) or, where relevant, waived in writing prior
to the Scheme being sanctioned by the Court:
NSIA Condition
(a) United Kingdom: a notification having been made and accepted
under the UK National Security and Investment Act 2021 (the "NSIA")
and one of the following having occurred:
(i) the Secretary of State confirming before the end of the
review period that no further action will be taken in relation to
the Acquisition;
(ii) if the Secretary of State issues a call-in notice in
relation to the Acquisition, the parties receiving a final
notification pursuant to section 26(1)(b) of the NSIA containing
confirmation that the Secretary of State will take no further
action in relation to the call-in notice and the Acquisition under
the NSIA;
(iii) the Secretary of State making a final order pursuant to
Section 26(1)(a) of the NSIA allowing the Acquisition to proceed
unconditionally or on terms satisfactory to Bidco; or
(iv) Bidco having received written notice by or on behalf of the
Secretary of State to the effect that the Acquisition is not a
notifiable acquisition pursuant to the NSIA;
Third Party Regulatory action
(b) no Third Party having decided, threatened or given notice of
a decision to take, institute, implement or threaten any action,
proceeding, suit, investigation, enquiry or reference (and in each
case not having withdrawn the same), or having required any action
to be taken or otherwise having done anything, or having enacted,
made or proposed any statute, regulation, decision, order or change
to published practice (and in each case not having withdrawn the
same) and there not continuing to be outstanding any statute,
regulation, decision or order which would or might reasonably be
expected to (in any case to an extent or in a manner which is
material in the context of the Acquisition, the Wider Target Group
or the Wider Bidco Group, as the case may be, in each case, taken
as a whole):
(i) require, prevent or materially delay the divestiture or
materially alter the terms envisaged for such divestiture by any
member of the Wider Bidco Group or by any member of the Wider
Target Group of all or any material part of their respective
businesses, assets, property or any shares or other securities (or
the equivalent) in any member of the Wider Target Group or any
member of the Wider Bidco Group or impose any material limitation
on the ability of all or any of them to conduct their respective
businesses (or any part thereof) or to own, control or manage any
of their respective assets or properties (or any part thereof);
(ii) except pursuant to Chapter 3 of Part 28 of the Companies
Act, in the event that Bidco elects to implement the Acquisition by
way of a Takeover Offer, require any member of the Wider Bidco
Group or the Wider Target Group to acquire or offer to acquire any
shares, other securities (or the equivalent) or interest in any
member of the Wider Target Group or any asset owned by any Third
Party (other than in connection with the implementation of the
Acquisition);
(iii) impose any material limitation on, or result in a material
delay in, the ability of any member of the Wider Bidco Group,
directly or indirectly, to acquire, hold or exercise effectively
all or any rights of ownership in respect of shares or loans or
securities convertible into shares or other securities (or the
equivalent) in Instem or on the ability of any member of the Wider
Target Group or any member of the Wider Bidco Group, directly or
indirectly, to hold or exercise effectively all or any rights of
ownership in respect of shares or loans or any other securities (or
the equivalent) in, or to exercise voting or management control
over, any other member of the Wider Target Group;
(iv) except as Disclosed, result in any member of the Wider
Target Group or any member of the Wider Bidco Group ceasing to be
able to carry on business under any names under which it currently
carries on business;
(v) make the Acquisition, its implementation or the acquisition
or proposed acquisition of any shares or other securities in, or
control or management of, Instem by any member of the Wider Bidco
Group void, unenforceable and/or illegal under the laws of any
relevant jurisdiction, or otherwise, directly or indirectly,
prevent or prohibit, restrict, restrain or delay or otherwise
interfere with the implementation of, or impose additional
conditions or obligations with respect to, or otherwise challenge,
impede, interfere or require material amendment to the terms of the
Acquisition or the acquisition or proposed acquisition of any
shares or other securities in, or control or management of Instem
by any member of the Wider Bidco Group;
(vi) impose any material limitation on, or result in material
delay in, the ability of any member of the Wider Bidco Group or any
member of the Wider Target Group to conduct, integrate or
co-ordinate all or any part of its business with all or any part of
the business of any other member of the Wider Bidco Group and/or
the Wider Target Group; or
(vii) otherwise materially adversely affect all or any of the
business, value, assets, liabilities, profits, operational
performance, financial or trading position or prospects of any
member of the Wider Target Group or any member of the Wider Bidco
Group;
and all applicable waiting and other time periods (including any
extensions thereof) during which any such Third Party could decide
to take, institute, implement or threaten any such action,
proceeding, suit, investigation, enquiry or reference or take any
other step under the laws of any jurisdiction in respect of the
Acquisition having expired, lapsed or been terminated;
Other regulatory approvals
(c) each Governmental Entity, which regulates or licences any
member of the Instem Group or any other body corporate in which any
member of the Instem Group has an interest in shares, and whose
prior approval, consent or non-objection to any change in control,
or acquisition of (or increase in) control in respect of that or
any other member of the Instem Group is required, or any
Governmental Entity, whose prior approval, consent or non-objection
of the Acquisition is otherwise required, or from whom one or more
material licences or permissions are required in order to complete
the Acquisition, having given its approval, non-objection or
legitimate deemed consent or consent in writing thereto and, as the
case may be, having granted such licences and permissions (in each
case where required and on terms reasonably satisfactory to Bidco),
and in each case the impact of which would materially adversely
affect the Wider Target Group or the Wider Bidco Group, taken as a
whole;
Notifications, waiting periods and authorisations
(d) all material notifications, filings or applications which
are necessary or considered appropriate or desirable by Bidco
having been made in connection with the Acquisition and all
necessary waiting and other time periods (including any extensions
thereof) under any applicable legislation or regulation of any
jurisdiction having expired, lapsed or been terminated (as
appropriate) and all statutory and regulatory obligations in any
jurisdiction having been complied with, in each case, in respect of
the Scheme and the Acquisition and all Authorisations deemed
reasonably necessary or appropriate by Bidco in any jurisdiction
for or in respect of the Acquisition and, except pursuant to
section 160 of the Companies Act and Chapter 3 of Part 28 of the
Companies Act, or control or management of, Instem or any other
member of the Wider Target Group by any member of the Wider Bidco
Group having been obtained in terms and in a form reasonably
satisfactory to Bidco from all appropriate Third Parties or
(without prejudice to the generality of the foregoing) from any
person or bodies with whom any member of the Wider Target Group or
the Wider Bidco Group has entered into contractual arrangements and
all such Authorisations necessary, appropriate or desirable to
carry on the business of any member of the Wider Target Group in
any jurisdiction having been obtained and all such Authorisations
remaining in full force and effect at the time at which the
Acquisition becomes otherwise wholly unconditional and there being
no notice or intimation of an intention to revoke, suspend,
restrict, modify or not to renew such Authorisations;
Instem Shareholder resolution
(e) except with the consent or the agreement of Bidco, no action
having been taken or proposed by any member of the Instem Group, or
having been approved by a resolution of Instem Shareholders, or
consented to by the Takeover Panel, which falls within or under
Rule 21.1 of the Code;
Certain matters arising as a result of any arrangement,
agreement, etc.
(f) except as Disclosed, there being no provision of any
arrangement, agreement, lease, licence, franchise, permit or other
instrument to which any member of the Wider Target Group is a party
or by or to which any such member or any of its assets is or may be
bound, entitled or subject, or any event or circumstance which, as
a consequence of the Acquisition or because of a change in the
control of any member of the Wider Target Group as a result of the
Acquisition, would or might reasonably be expected to result in (in
each case to an extent or in a manner which is material in the
context of the Wider Target Group taken as a whole):
(i) any monies borrowed by, or any other indebtedness or
liabilities, actual or contingent, of, or any grant available to,
any such member being or becoming repayable, or capable of being
declared repayable, immediately or prior to its or their stated
maturity date or repayment date, or the ability of any such member
to borrow monies or incur any indebtedness being withdrawn or
inhibited or being capable of becoming or being withdrawn or
inhibited;
(ii) the creation, save in the ordinary and usual course of
business, or enforcement of any mortgage, charge or other security
interest over the whole or any part of the business, property or
assets of such member or any such mortgage, charge or other
security interest (whenever created, arising or having arisen)
becoming enforceable;
(iii) any such arrangement, agreement, lease, licence,
franchise, permit or other instrument or the rights, liabilities,
obligations or interests of any such member in or with any other
person (or any arrangement or arrangements relating to any such
interests or business) being adversely modified or adversely
affected or any onerous obligation or liability arising or any
adverse action being terminated, taken or arising thereunder;
(iv) any liability of any such member to make any severance,
termination, bonus or other payment to any of its directors or
other officers;
(v) the rights, liabilities, obligations, interests or business
of any such member under any such arrangement, agreement, licence,
permit, lease or instrument or the interests or business of any
such member or any member of the Wider Target Group in or with any
other person or body or firm or company (or any arrangement
relating to any such interests or business) being terminated, or
adversely modified or affected or any onerous obligation or
liability arising or any adverse action being taken thereunder;
(vi) any such member ceasing to be able to carry on business
under any name under which it presently carries on business;
(vii) any material assets or material interests of, or any
material asset the use of which is enjoyed by, any such member
being or falling to be disposed of or charged or any right arising
under which any such asset or interest could be required to be
disposed of or charged or could cease to be available to any such
member otherwise than in the ordinary course of business;
(viii) the financial or trading position or prospects of, any
such member being prejudiced or adversely affected; or
(ix) the creation or acceleration of any material liability
(actual or contingent) by any such member other than trade
creditors or other liabilities incurred in the ordinary course of
business,
and no event having occurred which, under any provision of any
arrangement, agreement, licence, permit, franchise, lease or other
instrument to which any member of the Wider Target Group is a party
or by or to which any such member or any of its assets are bound,
entitled or subject, would or might result in any of the events or
circumstances as are referred to in Conditions 3 (f)(i) to (ix)
above, in each case which is or would be material in the context of
the Wider Target Group taken as a whole;
Certain events occurring since 31 December 2022
(g) except as Disclosed, no member of the Wider Target Group having since 31 December 2022:
(i) issued or agreed to issue or authorised or proposed or
announced its intention to authorise or propose the issue, of
additional shares of any class, or securities or securities
convertible into, or exchangeable for, or rights, warrants or
options to subscribe for or acquire, any such shares, securities or
convertible securities or transferred or sold or agreed to transfer
or sell or authorised or proposed the transfer or sale of Instem
Shares out of treasury (except, where relevant, as between Instem
and wholly-owned subsidiaries of Instem or between the wholly-owned
subsidiaries of Instem and except for the issue or transfer of
Instem Shares out of treasury on the vesting of awards or exercise
of options in the ordinary course under the Instem Share
Plans);
(ii) recommended, declared, paid or made or proposed to
recommend, declare, pay or make any bonus, dividend or other
distribution (whether payable in cash or otherwise) other than
dividends (or other distributions whether payable in cash or
otherwise) lawfully paid or made by any wholly-owned subsidiary of
Instem to Instem or any of its wholly-owned subsidiaries;
(iii) other than pursuant to the Acquisition (and except for
transactions between Instem and its wholly-owned subsidiaries or
between the wholly-owned subsidiaries of Instem and transactions in
the ordinary course of business) implemented, effected, authorised
or proposed or announced its intention to implement, effect,
authorise or propose any merger, demerger, reconstruction,
amalgamation, scheme, commitment or acquisition or disposal of
assets or shares or loan capital (or the equivalent thereof) in any
undertaking or undertakings in any such case to an extent which is
material in the context of the Wider Target Group taken as a whole
or in the context of the Acquisition;
(iv) except for transactions between Instem and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of Instem and
transactions in the ordinary course of business, disposed of, or
transferred, mortgaged or created any security interest over any
material asset or any right, title or interest in any material
asset or authorised, proposed or announced any intention to do
so;
(v) except for transactions between Instem and its wholly-owned
subsidiaries or between the wholly-owned subsidiaries of Instem
issued, authorised or proposed or announced an intention to
authorise or propose, the issue of or made any change in or to the
terms of any debentures or become subject to any contingent
liability or incurred or increased any indebtedness which in any
such case is material in the context of the Wider Target Group
taken as a whole or in the context of the Acquisition;
(vi) entered into or varied or authorised, proposed or announced
its intention to enter into or vary any material contract,
arrangement, agreement, transaction or commitment (whether in
respect of capital expenditure or otherwise) which is of a long
term, unusual or onerous nature or magnitude or which is or which
involves or could involve an obligation of an onerous nature or
magnitude, otherwise than in the ordinary course of business and in
each case to an extent which is material in the context of the
Wider Target Group taken as a whole;
(vii) entered into, materially varied, authorised or proposed
entry into or variation of, or announced its intention to enter
into or materially vary the terms of, or made any offer (which
remains open for acceptance) to enter into or vary to a material
extent the terms of any contract, service agreement, commitment or
arrangement with any director or senior executive of any member of
the Wider Target Group, otherwise than in the ordinary course of
business in each case to an extent which is material in the context
of the Wider Target Group taken as a whole;
(viii) establish any share option scheme, incentive scheme or
other benefit in respect of the Wider Target Group;
(ix) purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities
or reduced or made any other change to any part of its share
capital (except, in each case, where relevant, as between Instem
and wholly-owned subsidiaries of Instem or between the wholly-owned
subsidiaries of Instem);
(x) waived, compromised or settled any claim other than in the
ordinary course of business and which is material in the context of
the Wider Target Group as a whole;
(xi) terminated or varied the terms of any agreement or
arrangement between any member of the Wider Target Group and any
other person in a manner which would or might have a material
adverse effect on the financial position of the Wider Target Group
taken as a whole;
(xii) save as required in connection with the Acquisition, made
any material alteration to its memorandum, articles of association
or other incorporation documents or any material alteration to the
memorandum, articles of association or other incorporation
documents of any other member of the Wider Target Group which is
material in the context of the Scheme or the Acquisition;
(xiii) establish any pension scheme(s) in respect of the Wider Target Group;
(xiv) been unable, or admitted in writing that it is unable, to
pay its debts or commenced negotiations with one or more of its
creditors with a view to rescheduling or restructuring any of its
indebtedness, or having stopped or suspended (or threatened to stop
or suspend) payment of its debts generally or ceased or threatened
to cease carrying on all or a substantial part of its business
which is material in the context of the Wider Target Group taken as
a whole;
(xv) (other than in respect of a member of the Wider Target
Group which is dormant and was solvent at the relevant time) taken
or proposed any steps, corporate action or had any legal
proceedings instituted or threatened against it in relation to the
suspension of payments, a moratorium of any indebtedness, its
winding-up (voluntary or otherwise), dissolution, reorganisation or
for the appointment of a receiver, administrator, manager,
administrative receiver, trustee or similar officer of all or any
material part of its assets or revenues or any analogous or
equivalent steps or proceedings in any jurisdiction or appointed
any analogous person in any jurisdiction or had any such person
appointed;
(xvi) (except for transactions between Instem and its
wholly-owned subsidiaries or between the wholly-owned subsidiaries)
made, authorised, proposed or announced an intention to propose any
change in its loan capital;
(xvii) entered into, implemented or authorised the entry into,
any joint venture, asset or profit-sharing arrangement, partnership
or merger of business or corporate entities, which in any such case
is material in the context of the Wider Target Group as a whole or
in the context of the Acquisition; or
(xviii) otherwise than in the ordinary course of business,
entered into any agreement, arrangement, commitment or contract or
passed any resolution or made any offer (which remains open for
acceptance) with respect to or announced an intention to, or to
propose to, effect any of the transactions, matters or events
referred to in this Condition 3 (g) and which is material in the
context of the Wider Target Group taken as a whole;
No adverse change, litigation, regulatory enquiry or similar
(h) except as Disclosed, since 31 December 2022 there having been:
(i) no adverse change and no circumstance having arisen which
would reasonably be expected to result in any adverse change in,
the business, value, assets, liabilities, shareholders' equity,
financial or trading position or profits, operational performance
or prospects of any member of the Wider Target Group which is
material in the context of the Wider Target Group taken as a whole
or in the context of the Acquisition;
(ii) no litigation, arbitration proceedings, prosecution or
other legal proceedings to which any member of the Wider Target
Group is or may become a party (whether as a claimant, defendant or
otherwise) having been threatened, announced, implemented or
instituted by or against or remaining outstanding against or in
respect of, any member of the Wider Target Group, in each case
which would reasonably be expected to have a material adverse
effect on the Wider Target Group taken as a whole or in the context
of the Acquisition;
(iii) no enquiry, review or investigation by, or complaint or
reference to, any Third Party against or in respect of any member
of the Wider Target Group (or any person in respect of which any
such member has or may have responsibility or liability) having
been threatened, announced, implemented or instituted or remaining
outstanding by, against or in respect of any member of the Wider
Target Group, in each case, which would reasonably be expected to
have a material adverse effect on the Wider Target Group taken as a
whole or in the context of the Acquisition;
(iv) no contingent or other liability having arisen or become
apparent to Bidco or increased other than in the ordinary course of
business which is reasonably likely to affect adversely the
business, assets, financial or trading position, profits or
operational performance of any member of the Wider Target Group to
an extent which is material in the context of the Wider Target
Group taken as a whole or in the context of the Acquisition;
(v) no steps having been taken and no omissions having been made
which are likely to result in the withdrawal, cancellation,
termination or modification of any licence held by any member of
the Wider Target Group which is necessary for the proper carrying
on of its business and the withdrawal, cancellation, termination or
modification of which would reasonably be expected to have a
material adverse effect on the Wider Target Group taken as a whole
or in the context of the Acquisition; and
(vi) no member of the Wider Target Group having conducted its
business in material breach of any applicable laws and regulations
which in any case is material in the context of the Wider Target
Group taken as a whole;
No discovery of certain matters regarding information and
liabilities, corruption, intellectual property and environmental
liabilities
(i) except as Disclosed, Bidco not having discovered that:
(i) any financial, business or other information concerning the
Wider Target Group announced publicly and delivered by or on behalf
of Instem through a RIS prior to the date of this Announcement is
misleading, contains a material misrepresentation of any fact, or
omits to state a fact necessary to make that information not
misleading, in any such case which is material in the context of
the Wider Target Group taken as a whole or in the context of the
Acquisition;
(ii) any member of the Wider Target Group or any partnership,
company or other entity in which any member of the Wider Target
Group has a significant economic interest and which is not a
subsidiary undertaking of Instem, otherwise than in the ordinary
course of business, is subject to any liability, contingent or
otherwise, and which is material in the context of the Wider Target
Group taken as a whole or in the context of the Acquisition;
(iii) any past or present member, director, officer or employee
of the Wider Target Group, or any other person for whom any such
person may be liable or responsible, has not complied with the OECD
Convention on Combating Bribery of Foreign Public Officials in
International Business Transactions and any laws implementing the
same, the UK Bribery Act 2010 and/or the US Foreign Corrupt
Practices Act of 1977;
(iv) any member of the Wider Target Group is ineligible to be
awarded any contract or business under section 23 of the Public
Contracts Regulations 2006 or section 26 of the Utilities Contracts
Regulations 2006 (each as amended);
(v) any director, officer or employee of the Wider Target Group,
or any other person for whom any such person may be liable or
responsible, has engaged in any business with or made any
investment in, or made any payments to: (A) any government, entity
or individual with which US or EU persons are prohibited from
engaging in activities or doing business by US or EU laws or
regulations, including the economic sanctions administered by the
United States Office of Foreign Assets Control or HM Treasury &
Customs, or (B) any government, entity or individual targeted by
any of the economic sanctions of the United Nations or the European
Union or any of their respective member states;
(vi) any asset of any member of the Wider Target Group
constitutes criminal property as defined by section 340(3) of the
Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that
definition);
(vii) no circumstance having arisen or event having occurred in
relation to any intellectual property owned, used or licensed by
the Wider Target Group or to any third parties, including: (A) any
member of the Wider Target Group losing its title to any
intellectual property or any intellectual property owned by the
Wider Target Group being revoked, cancelled or declared invalid,
(B) any agreement regarding the use of any intellectual property
licensed to or by any member of the Wider Target Group being
terminated or varied, or (C) any claim being filed suggesting that
any member of the Wider Target Group infringed the intellectual
property rights of a third party or any member of the Wider Target
Group being found to have infringed the intellectual property
rights of a third party, in each case which is material in the
context of the Wider Target Group taken as a whole or in the
context of the Acquisition; or
(viii) in relation to any release, emission, accumulation,
discharge, disposal or other similar circumstance which has
impaired or is likely to impair the environment (including
property) or harmed or is likely to harm the health of humans,
animals or other living organisms or eco-systems, any past or
present member of the Wider Target Group, in a manner or to an
extent which is material in the context of the Wider Target Group,
(i) has committed any violation of any applicable laws, statutes,
regulations, Authorisations, notices or other requirements of any
Third Party giving rise to a material liability; and/or (ii) has
incurred any material liability (whether actual or contingent) to
any Third Party; and/or (iii) is likely to incur any material
liability (whether actual or contingent), or is required, to make
good, remediate, repair, re-instate or clean up the environment
(including any property) in each case of (i), (ii) or (iii) which
such liability or requirement would be material to the Wider Target
Group taken as a whole.
Part B: Waiver and invocation of the Conditions
1. Subject to the requirements of the Takeover Panel, Bidco
reserves the right in its sole discretion to waive all or any of
the Conditions set out in Part A of this Appendix I except
Conditions 2(a) (i), 2(b) (i), 2(c) (i) and 2(d) which cannot be
waived. The deadlines in any of Conditions 1 , 2(a) (ii), 2(b) (ii)
and 2(c) (ii) may be extended to such later date as may be agreed
in writing by Bidco and Instem (with the consent of the Takeover
Panel and/or approval of the Court, if such consent and/or approval
is required). If any of the Conditions set out at 1 , 2(a) (ii),
2(b) (ii) and 2(c) (ii) is not satisfied by the deadline specified
in the relevant Condition, Bidco shall make an announcement by 8.00
a.m. on the Business Day following such deadline confirming whether
it has invoked the relevant Condition, waived the relevant deadline
or agreed with Instem to extend the relevant deadline.
2. Subject to paragraph 3(g) of Appendix 7 to the Code, Bidco
shall be under no obligation to waive (if capable of waiver), to
determine to be or remain satisfied or treat as fulfilled any of
Conditions 3(a) to 3(i) of Part A of this Appendix I by a date
earlier than the Long Stop Date, notwithstanding that the other
Conditions may at such earlier date have been waived or fulfilled
and that there are, at such earlier date, no circumstances
indicating that any Condition may not be capable of fulfilment.
3. Subject to paragraph 4 below, under Rule 13.5(a) of the Code,
Bidco may only invoke a Condition so as to cause the Acquisition
not to proceed, to lapse or to be withdrawn with the consent of the
Takeover Panel. The Takeover Panel will normally only give its
consent if the circumstances which give rise to the right to invoke
the Condition are of material significance to Bidco in the context
of the Acquisition. This will be judged by reference to the facts
of each case at the time that the relevant circumstances arise.
4. Conditions 1 and 2 of Part A of this Appendix I (and any
Takeover Offer acceptance condition adopted on the basis specified
in Part C of this Appendix I) will not be subject to Rule 13.5(a)
of the Code.
5. Any Condition that is subject to Rule 13.5(a) of the Code may be waived by Bidco.
6. The Scheme will not become effective unless the Conditions
have been fulfilled or (to the extent capable of waiver) waived or,
where appropriate, have been determined by Bidco to be or remain
satisfied by no later than the Long Stop Date.
7. If the Takeover Panel requires Bidco to make an offer or
offers for any Instem Shares under the provisions of Rule 9 of the
Code, Bidco may make such alterations to the Conditions as are
necessary to comply with the provisions of that Rule.
8. Each of the Conditions shall be regarded as a separate
Condition and shall not be limited by reference to any other
Condition.
Part C: Implementation by way of a Takeover Offer
Bidco reserves the right to elect (with the consent of the
Takeover Panel) to implement the Acquisition by making, directly or
indirectly through a subsidiary or nominee of Bidco, a Takeover
Offer as an alternative to the Scheme. In such event, the Takeover
Offer will be implemented on the same terms or, unless Bidco
otherwise determines and subject to the consent of the Takeover
Panel, on such other terms being no less favourable, subject to
appropriate amendments, as far as applicable, as those which would
apply to the Scheme. The acceptance condition would be set at 90
per cent. of the shares to which such Takeover Offer relates (or
such lesser percentage, being more than 50 per cent., as Bidco may
decide with the consent of the Takeover Panel). Further, if
sufficient acceptances to the Takeover Offer are received and/or
sufficient Instem Shares are otherwise acquired, it is the
intention of Bidco to apply the provisions of the Companies Act to
compulsorily acquire any outstanding Instem Shares to which such
Takeover Offer relates.
Part D: Certain further terms of the Acquisition
1. Bidco reserves the right to implement the Acquisition through
any other entity owned and/or controlled by ARCHIMED from time to
time.
2. The Instem Shares shall be acquired by Bidco with full title
guarantee, fully paid and free from all liens, equitable interests,
charges, encumbrances, rights of pre-emption and any other third
party rights and interests whatsoever and together with all rights
existing at the date of this Announcement or thereafter attaching
thereto, including (without limitation) the right to receive and
retain, in full, all dividends and other distributions (if any)
declared, made or paid or any other return of capital (whether by
way of reduction of share capital or share premium account or
otherwise) made on or after the Effective Date in respect of the
Instem Shares.
3. If, on or after the date of this Announcement and prior to or
on the Effective Date, any dividend, distribution or other return
of value is declared, paid or made or becomes payable by Instem and
with a record date on or prior to the Effective Date, Bidco
reserves the right (without prejudice to any right of Bidco, with
the consent of the Takeover Panel, to invoke Condition 3 (g) (ii)
of Part A of this Appendix I) to reduce the consideration payable
under the Acquisition to reflect the aggregate amount of such
dividend, distribution or other return of value or excess. If and
to the extent that any such dividend, distribution or other return
of value is paid or made on or prior to the Effective Date and
Bidco exercises its rights under this paragraph to reduce the
consideration payable under the Acquisition, any reference in this
Announcement to the consideration payable under the terms of the
Acquisition shall be deemed to be a reference to the consideration
as so reduced. Any exercise by Bidco of its rights referred to in
this paragraph 3 shall be the subject of an announcement and, for
the avoidance of doubt, shall not be regarded as constituting any
revision or variation of the Acquisition.
4. The availability of the Acquisition to persons not resident
in the United Kingdom may be affected by the laws of relevant
jurisdictions. Therefore any persons who are subject to the laws of
any jurisdiction other than the United Kingdom and any Instem
Shareholders who are not resident in the United Kingdom will need
to inform themselves about and observe any applicable
requirements.
5. Unless otherwise determined by Bidco or required by the Code
and permitted by applicable law and regulations, the Acquisition is
not being, and will not be, made, directly or indirectly, in, into
or by the use of the mails of, or by any other means or
instrumentality (including, but not limited to, facsimile, email or
other electronic transmission, telex or telephone) of interstate or
foreign commerce of, or of any facility of a national, state or
other securities exchange of, any Restricted Jurisdiction and will
not be capable of acceptance by any such use, means,
instrumentality or facility or from within any Restricted
Jurisdiction.
6. The Acquisition will be subject, amongst other things, to the
Conditions and certain further terms which are set out in this
Appendix I and those terms which will be set out in the Scheme
Document and such further terms as may be required to comply with
the AIM Rules and the provisions of the Code.
7. This Announcement and any rights or liabilities arising
hereunder, the Acquisition, the Scheme and the Forms of Proxy will
be governed by English law and will be subject to the jurisdiction
of the English courts. The Acquisition shall be subject to the
applicable requirements of the Code, the Takeover Panel, the London
Stock Exchange and the FCA.
APPIX II
SOURCES OF INFORMATION AND BASES OF CALCULATION
In this Announcement, unless otherwise stated or the context
otherwise requires, the following sources and bases have been
used:
(a) The value attributed to the fully diluted share capital of
Instem of GBP203 million is based on a value of 833 pence per
Instem Share and:
(i) 22,899,433 Instem Shares in issue on 29 August 2023 (being
the last Business Day prior to the date of this Announcement);
and
(ii) 1,481,686 Instem Shares which as at 29 August 2023 may be
issued on or after the date of this Announcement on the exercise of
options or vesting of awards under the Instem Share Plans
(including up to 505,837 options capable of exercise pursuant to
options and awards expected to be granted shortly following this
Announcement).
(b) The enterprise value of GBP198 million is calculated by
reference to the fully diluted equity minus pro forma net cash of
GBP4.8 million as at 31 December 2022, with pro forma net cash
comprising the below from the audited consolidated balance of
Instem as of that date and Instem public filings:
(i) cash and cash equivalents of GBP14.0 million;
(ii) current financial liabilities of GBP5.8 million;
(iii) current lease liabilities of GBP0.8 million;
(iv) pension obligations of GBP2.0 million;
(v) provision for liabilities and charges of GBP45,000; and
(vi) non-current lease liabilities of GBP0.5 million.
(c) The implied enterprise value multiple of approximately 18.3
times, is based on Instem's EBITDA for the 12 months to 31 December
2022 of GBP10.9 million.
(d) Financial information relating to Instem has been extracted
from the audited consolidated financial statements of Instem for
the financial year ended 31 December 2022.
(e) Unless otherwise stated, all prices for Instem Shares are
the Closing Price for the relevant date.
(f) The Closing Prices of Instem Shares are taken from the Daily Official List.
(g) The three month and six-month Volume Weighted Average Price
are derived from Bloomberg data and have been rounded to the
nearest one penny.
(h) Certain figures included in this Announcement have been subject to rounding adjustments.
APPIX III
DETAILS OF IRREVOCABLE UNDERTAKINGS
Bidco has received irrevocable undertakings to vote or procure
votes in favour of the Scheme at the Court Meeting and the
Resolution to be proposed at the General Meeting (or, subject to
the terms of the Co-operation Agreement and with the consent of the
Takeover Panel, if Bidco exercises its right to implement the
Acquisition by way of a Takeover Offer, to accept such offer) in
respect of a total of 2,107,579 Instem Shares (representing, in
aggregate, approximately 9.20 per cent. of Instem Shares in issue
on 29 August 2023 (being the last Business Day prior to this
Announcement)), comprised as follows:
Instem Directors' (and certain related family trusts' and
connected persons) irrevocable undertakings
Per cent. of Instem
Shares
Name Number of Instem Shares in issue
--------------------------- ------------------------ --------------------
Phil Reason 770,714 3.37%
DG 2008 Discretionary
Settlement Trust (of
which David Gare and
Norma Gare are Trustees) 538,427 2.35%
Nigel Goldsmith 10,000 0.04%
Deborah Walker 394,219 1.72%
Michael Gare 394,219 1.72%
Total 2,107,579 9.20%
The irrevocable undertakings given by the Instem Directors as
set out above will apply to any Instem Shares acquired as a result
of any awards or options exercised pursuant to the Instem Share
Plans .
The irrevocable undertakings from the Instem Directors will only
cease to be binding if:
(a) Bidco announces, with the consent of the Panel and before
the Scheme Document or Offer Document (as applicable) is published,
that it does not intend to proceed with the Acquisition and no new,
revised or replacement scheme or takeover offer to implement the
Acquisition is announced in accordance with Rule 2.7 of the Code
within 10 Business Days of such announcement;
(b) the Scheme or Takeover Offer (as applicable) lapses or is
withdrawn in accordance with its terms and no new, revised or
replacement scheme or takeover offer to implement the Acquisition
has been announced in accordance with Rule 2.7 of the Code within
10 Business Days of such lapse or withdrawal; or
(c) any competing offer for the issued and to be issued share
capital of Instem is made which becomes or is declared
unconditional (if implemented by way of a Takeover Offer) or
otherwise becomes effective (if implemented by way of a scheme of
arrangement).
APPIX IV
Definitions
In this Announcement, the following words and expressions have
the following meanings, unless the context requires otherwise:
Acquisition the recommended offer to be made by Bidco to acquire the entire issued and to be
issued share
capital of Instem to be effected by means of the Scheme (or, if Bidco so elects and
subject
to the Takeover Panel's consent, a Takeover Offer) on the terms and subject to the
conditions
set out in the Scheme Document;
Acquisition Price 833 pence per Scheme Share;
AIM AIM, a market operated by the London Stock Exchange;
AIM Rules the rules of AIM as set out in the "AIM Rules for Companies" issued by the London
Stock Exchange
from time to time relating to AIM traded securities and the operation of AIM;
Announcement this announcement of the Acquisition made in accordance with Rule 2.7 of the Code;
ARCHIMED ARCHIMED SAS , a simplified joint stock company incorporated and registered in France
and
entered in the Lyon trade and companies register under number 795 309 525 and whose
registered
office is located at Silex, 9 rue des Cuirassiers, 69003 Lyon, France;
Authorisations authorisations, orders, recognitions, grants, consents, clearances, confirmations,
certificates,
licences, permissions, determinations, exemptions or approvals;
Bidco Ichor Management Limited, a company incorporated in England and Wales with company
number
15079249;
Business Day a day, other than a Saturday, Sunday, public holiday or bank holiday, on which banks
are generally
open for normal business in the City of London;
Clean Team Agreement means the clean team agreement between Bidco and Instem dated 24 August 2023;
Closing Price the closing middle market quotation for a Instem Share as derived from the Daily
Official
List on that day;
Code the City Code on Takeovers and Mergers;
Companies Act the UK Companies Act 2006, as amended;
Conditions the conditions to the implementation of the Scheme and the Acquisition, which are set
out
in Appendix I to this Announcement and to be set out in the Scheme Document;
Confidentiality Agreement the confidentiality agreement entered into by ARCHIMED and Instem on 7 June 2023 ;
Co-operation Agreement the co-operation agreement entered into by Bidco and Instem on or around the date of
this
Announcement ;
Court the High Court of Justice, Chancery Division (Companies Court) in England and Wales;
Court Meeting the meeting (or any adjournment, postponement or reconvention thereof) of the Scheme
Shareholders
(or the relevant class or classes thereof) to be convened by order of the Court
pursuant to
section 896 of the Companies Act to consider and, if thought fit, approve the Scheme
(with
or without modification);
Court Order the order of the Court sanctioning the Scheme;
CREST the relevant system (as defined in the Regulations) in respect of which Euroclear UK
& International
Limited is the Operator (as defined in the Regulations);
Daily Official List the Daily Official List of the London Stock Exchange;
Dealing Disclosure has the same meaning as in Rule 8 of the Code;
Disclosed (i) matters fairly disclosed in the information made available to Bidco (or Bidco's
advisers)
in the data room established by Instem for the purposes of the Acquisition; (ii)
information
fairly disclosed in writing by or on behalf of Instem to Bidco prior to the date of
this Announcement
in relation to the Acquisition; (iii) information included in the annual report and
accounts
of the Instem Group for the financial year ended 31 December 2022; (iv) information
included
in the annual report and accounts of the Instem Group for the financial year ended 31
December
2021; (v) information disclosed in a public announcement to a RIS made by Instem
prior to
the date of this Announcement; or (vi) disclosed in this Announcement;
Disclosure Table the disclosure table on the Takeover Panel's website at www.thetakeoverpanel.org.uk ;
Effective in the context of the Acquisition: (a) if the Acquisition is implemented by way of a
Scheme,
the Scheme having become effective in accordance with its terms, upon the delivery of
the
Court Order to the Registrar of Companies; or (b) if the Acquisition is implemented
by way
of a Takeover Offer, the Takeover Offer having been declared or become unconditional
in all
respects in accordance with the requirements of the Code;
Effective Date the date upon which: (a) the Scheme becomes Effective; or (b) if Bidco elects and the
Takeover
Panel consents to implement the Acquisition by way of a Takeover Offer, the Takeover
Offer
becomes Effective;
Excluded Shares (a) any Instem Shares legally or beneficially held by Bidco or any member of the
Wider Bidco
Group; or (b) any Treasury Shares;
FCA the UK Financial Conduct Authority or its successor from time to time , acting in its
capacity
as the competent authority for the purposes of Part VI of FSMA ;
Forms of Proxy the forms of proxy for use at the Court Meeting and the General Meeting respectively,
which
will accompany the Scheme Document;
FSMA the Financial Services and Markets Act 2000, as amended from time to time;
General Meeting the general meeting (or any adjournment, postponement or reconvention thereof) of
Instem Shareholders
to be convened in connection with the Scheme;
Governmental Entity any supranational, national, state, municipal, local or foreign government, any
instrumentality,
subdivision, court, arbitrator or arbitrator panel, regulatory or administrative
agency or
commission, or other authority thereof, or any regulatory or quasi-regulatory
organisation
or private body exercising any regulatory, taxing, importing or other governmental or
quasi-governmental
authority;
Instem Instem plc, a company incorporated in England and Wales with company number 07148099;
Instem Board the board of directors of Instem from time to time;
Instem Directors the directors of Instem from time to time;
Instem Group Instem and its subsidiaries and subsidiary undertakings;
Instem Share Plans the Instem plc Long Term Incentive Plan and the Instem plc 2018 Long Term Incentive
Plan;
Instem Shareholders the holders of Instem Shares;
Instem Shares ordinary shares of GBP0.10 each in the capital of Instem and each a "Instem Share";
ISIN International Securities Identification Number;
London Stock Exchange London Stock Exchange Plc, a company incorporated in England and Wales with company
number
02075721;
Long Stop Date 29 February 2024 or such later date (if any) as Bidco and Instem may, with the
consent of
the Takeover Panel, agree and (if required) the Court may allow;
Moelis Moelis & Company UK LLP, a limited liability partnership registered in England and
Wales with
registration number OC340005;
NSIA Condition the Condition set out at paragraph 3 (a) of Part A of Appendix I;
Offer Document should the Acquisition be implemented by way of a Takeover Offer, the document which
would
be sent to Instem Shareholders containing, amongst other things, the terms and
conditions
of the Takeover Offer;
Offer Period the period which commenced on the date of this Announcement and ending on the date on
which
the Acquisition becomes Effective, lapses or is withdrawn (or such other date as the
Takeover
Panel may decide);
Opening Position Disclosure has the same meaning as in Rule 8 of the Code;
Registrar of Companies Registrar of Companies of England and Wales;
Regulations the Uncertificated Securities Regulations 2001 (SI 2001/3755);
Resolution the resolution to be proposed by Instem at the General Meeting in connection with the
Acquisition;
Restricted Jurisdiction any jurisdiction where local laws or regulations may result in a significant risk of
civil,
regulatory or criminal exposure if information concerning the Acquisition is sent or
made
available in that jurisdiction;
RIS a service approved by the London Stock Exchange for the distribution to the public of
announcements
and included within the list maintained on the London Stock Exchange's website;
Rothschild & Co N. M. Rothschild & Sons Limited, a company incorporated in England and Wales with
company
number 00925279;
Sanction Hearing the hearing by the Court to sanction the Scheme and, if such hearing is adjourned,
references
to the commencement of any such hearing shall mean the commencement of the final
adjournment
thereof;
Scheme the proposed scheme of arrangement under Part 26 of the Companies Act to effect the
Acquisition
between Instem and the Scheme Shareholders (the full terms of which will be set out
in the
Scheme Document), with or subject to any modification, addition or condition which
Bidco and
Instem may agree, and, if required, the Court may approve or impose;
Scheme Document the document to be despatched to (amongst others) Instem Shareholders containing,
amongst
other things, the terms and conditions of the Scheme, the notices convening the Court
Meeting
and the General Meeting;
Scheme Record Time the time and date to be specified in the Scheme Document, expected to be 6:00 p.m. on
the
Business Day immediately prior to the Effective Date;
Scheme Shareholders holders of Scheme Shares;
Scheme Shares the Instem Shares:
(i) in issue at the date of the Scheme Document;
(ii) (if any) issued after the date of the Scheme Document and prior to the Voting
Record
Time; and
(iii) (if any) issued at or after the Voting Record Time but at or before the Scheme
Record
Time in respect of which the original or any subsequent holder thereof is bound by
the Scheme
or shall by such time have agreed in writing to be bound by the Scheme;
in each case other than any Excluded Shares;
Singer Capital Markets Singer Capital Markets Advisory LLP, a limited liability partnership incorporated in
England
and Wales with registered number OC364131;
Substantial Interest in relation to an undertaking, a direct or indirect interest of 20 per cent. or more
of the
total voting rights conferred by the equity share capital (as defined in section 548
of the
Companies Act) of such undertaking;
Takeover Offer should the Acquisition be implemented by way of a takeover offer as defined in
section 974
of the Companies Act 2006, the offer to be made by or on behalf of Bidco to acquire
the entire
issued and to be issued ordinary share capital of Instem and, where the context
requires,
any subsequent revision, variation, extension or renewal of such offer;
Takeover Panel the UK Panel on Takeovers and Mergers;
Third Party each of a central bank, government or governmental, quasi-governmental,
supranational, statutory,
regulatory, professional or investigative body or authority (including any antitrust
or merger
control authority), court, trade agency, professional association, institution, works
council,
employee representative body or any other similar body or person whatsoever in any
jurisdiction;
Treasury Shares any Instem Shares which are held by Instem as treasury shares (within the meaning of
the Companies
Act);
United Kingdom or UK the United Kingdom of Great Britain and Northern Ireland;
United States or US the United States of America, its territories and possessions, all areas subject to
its jurisdiction
or any subdivision thereof, any state of the United States of America and the
District of
Columbia;
US Exchange Act the United States Securities Exchange Act of 1934 and the rules and regulations
promulgated
thereunder;
Volume Weighted Average Price the volume weighted average of the per share trading prices of Instem Shares on the
London
Stock Exchange as reported through Bloomberg;
Voting Record Time the date and time specified in the Scheme Document by reference to which entitlements
to vote
on the Scheme will be determined, expected to be 6.00 p.m. on the day which is two
days before
the date of the Court Meeting or, if the Court Meeting is adjourned, 6.00 p.m. on the
second
day before the date of such adjourned meeting;
Wider Bidco Group Bidco, funds managed by ARCHIMED and its affiliates and including any funds managed
by affiliates
of ARCHIMED or such funds, and their respective subsidiary undertakings, associated
undertakings
and any other body corporate partnership, joint venture or person in which Bidco
and/or such
undertakings (aggregating their interests) have a direct or indirect Substantial
Interest
or the equivalent (excluding, for the avoidance of doubt, any member of the Wider
Target Group);
Wider Target Group Instem, its subsidiary undertakings, associated undertakings and any other
undertaking, body
corporate, partnership, joint venture or person in which Instem and/or such
undertakings (aggregating
their interests) have a direct or indirect Substantial Interest or the equivalent;
GBP or pence pounds sterling or pence, the lawful currency of the UK; and
$ or USD or dollars dollars, the lawful currency of the United States of America.
In this Announcement:
(a) all times referred to are to London time unless otherwise stated;
(b) references to the singular include the plural and vice
versa, unless the context otherwise requires;
(c) "subsidiary", "subsidiary undertaking" and "undertaking"
have the meanings given by the Companies Act and "associated
undertaking" has the meaning given to it by paragraph 19 of
Schedule 6 of the Large and Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008, other than paragraph 1(b)
thereof which shall be excluded for this purpose; and
(d) all references to statutory provision or law or to any order
or regulation shall be construed as a reference to that provision,
law, order or regulation as extended, modified, replaced or
re-enacted from time to time and all statutory instruments,
regulations and orders from time to time made thereunder or
deriving validity therefrom.
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END
OUPNKCBPBBKBAFB
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