TIDMCTNA
RNS Number : 1043W
Catena Group PLC
21 April 2021
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the company's obligations under Article 17 of MAR.
21 April 2021
Catena Group PLC
("Catena" or the "Company")
Proposed acquisition of Insight Capital Partners Limited
("Insight"),
Conditional Placing to raise GBP6.1 million, Approval of Rule 9
Waiver,
Change of Name to Insig AI plc, Notice of General Meeting and
Restoration of trading on AIM
Catena, the AIM-listed holding company focused on acquiring and
growing businesses operating in high performing industries, is
pleased to announce that it has signed a conditional acquisition
agreement to acquire Insight, a data science and machine learning
solutions company (the "Acquisition"). The Acquisition is for the
balance of Insight shares not already owned by the Company,
following Catena's initial acquisition of 9.1 per cent. of Insight
in March 2020.
The Acquisition constitutes a reverse takeover pursuant to Rule
14 of the AIM Rules for Companies and as such will require the
approval of Shareholders which will be sought at the General
Meeting convened for 9.00 a.m. on 7 May 2021.
The Admission Document and circular to Shareholders, including
the Notice of General Meeting and Form of Proxy have been posted to
Shareholders and are also available on the Company's website:
catenagroup.co.uk .
As a result of the publication of the Admission Document,
trading in the Company's shares on AIM will resume at 7.30am
today.
Acquisition of the outstanding 89.9 per cent. of Insight is to
be satisfied by the issue of 45,311,386 Consideration Shares at 59
pence per share and, depending on the number of Consideration
Shares that the Insight Option Holders acquire, Cash Consideration
of up to GBP1.5 million. Further details of the Acquisition are
outlined below.
The Company is proposing to raise a total of approximately
GBP6.1 million (before expenses) by way of a conditional placing of
the Placing Shares, at the Issue Price of 67 pence per Placing
Share representing a premium of approximately 14 per cent. to the
closing middle market price of 59 pence per Ordinary Share on 2
September 2020 (being the last business day before the Ordinary
Shares were suspended). The Placing Shares will represent up to
approximately 10.0 per cent. of the Enlarged Share Capital at
Admission.
HIGHLIGHTS:
-- The Acquisition of the balance of shares in Insight not
already owned by the Company for approximately GBP27.9 million,
satisfied by way of up to 47,264,023 Consideration Shares at 59
pence per share and up to GBP1.5 million Cash Consideration
-- GBP6.1 million raised (before expenses) by way of a Placing
to pay the Cash Consideration and for general working capital
purposes
-- General Meeting to be held on 7 May 2021 to approve the
Resolutions in relation to, inter alia, the Acquisition and the
Rule 9 Whitewash
-- Subject to the passing of the Resolutions , the board of
directors of the Company will comprise:
o Matthew Farnum-Schneider, Executive Chairman
o Steve Cracknell, Chief Executive Officer
o Warren Pearson, Chief Technology Officer
o Peter Rutter, Non-Executive Director
o John Murray, Non-Executive Director
David Hillel, David Coldbeck and John Zucker, existing directors
of Catena will be resigning from the Board.
Catena Group plc CEO, Matthew Farnum-Schneider, commented:
"We are delighted to have agreed our full acquisition of Insight
and to be re-admitted to trading on AIM today. The completion of
the Acquisition will mark the start of an exciting new chapter for
the Company in artificial intelligence and machine learning.
We are also pleased to welcome Steve Cracknell, Warren Pearson
and Peter Rutter to the Board and the Insight team to the Company
and we look forward to working with them to realise Insig AI's
growth potential. Finally, I'd also like to recognise the efforts
and commitment of David Hillel, David Coldbeck and John Zucker and
their many years of service to the Company."
PLACING STATISTICS
Issue Price
67 pence
Number of Existing Ordinary Shares
42,661,638
Number of Placing Shares
9,172,375
Number of Consideration Shares(1)
45,311,386
Number of Convertible Loan Notes Shares
2,000,000
Enlarged Share Capital(1)
99,145,399
Percentage of the Enlarged Share Capital represented by the New
Ordinary 57.0 per cent.
Shares(1 and 2)
Market capitalisation of the Company at the Issue Price
following Admission(1 and 2) GBP66.4 million
Gross proceeds of the Placing
GBP6.1 million
Net proceeds of the Placing
GBP4.9 million
TIDM
CTNA
ISIN of the Ordinary Shares
GB00BYV31355
SEDOL number
BYV3135
LEI number
21380098CKBAG1NWCD98
Website address
www.catenagroup.co.uk
Notes:
1. Assumes that the Insight Option Holders exercise their rights
to receive the maximum entitlement to Consideration Shares
2. The market capitalisation of the Company at any given time
will depend on the market price of the Ordinary Shares at that
time. There can be no assurance that the market price of an
Ordinary Share from time to time will equal or exceed the Placing
Price
Defined terms within this announcement shall have the meaning
ascribed to them in the Company's Admission Document dated 21 April
2021.
For further information, please visit www.catenagroup.co.uk or
contact:
Catena Group PLC
Matthew Farnum-Schneider, Chief Executive +44 (0)20 3744 0900
Zeus Capital Limited (Nominated Adviser
& Broker)
David Foreman / Rishi Majithia / James
Hornigold +44 (0) 203 829 5000
SEC Newgate (Financial PR) +44 (0) 7540 106 366
Robin Tozer catena@secnewgate.com
FURTHER DETAILS
Catena is an existing AIM listed holding company focused on
acquiring and growing businesses operating in high performing
industries.
In line with this strategy, on 2 March 2020, the Company entered
into a conditional investment agreement to acquire an initial 9.1
per cent. interest, on a fully diluted basis, in the ordinary share
capital of Insight for GBP1.5 million. Insight is a data science
and machine learning solutions company focused on providing
products to the asset management sector.
On 3 September 2020, the Company announced that discussions had
commenced with respect to Catena potentially acquiring the balance
of the issued share capital of Insight not already owned by it. The
proposed Acquisition was deemed to constitute a reverse takeover
under the AIM Rules for Companies, resulting in the Ordinary Shares
being suspended from trading on AIM pending the publication of the
Admission Document that was published today, 21 April 2021.
The GBP6.1 million proceeds of the Placing will be used to pay
the Cash Consideration and for general working capital purposes,
namely investing in Insight's team of developers, engineers and
sales and marketing professionals to accelerate its product and
business development activities. The Placing is conditional, inter
alia, upon the passing of the Resolutions.
The Issue Price of 67 pence per Placing Share represents a
premium of approximately 14 per cent. to the closing middle market
price of 59 pence per Ordinary Share on 2 September 2020 (being the
last business day before the Ordinary Shares were suspended).
On 20 April 2021, Catena and the Principal Insight Sellers
entered into the Acquisition Agreement and Catena and each of the
Minority Insight Sellers entered into the Minority Acquisition
Agreements. The consideration for the Acquisition will be satisfied
by the issue of the Consideration Shares and payment of the Cash
Consideration.
Since the launch of the Company's new strategy in 2020, the
Board has been focused on identifying suitable acquisition
opportunities. The Board considers the proposed Acquisition to be a
compelling proposition given Insight's suite of products and
services which they believe offer significant opportunities for
growth that can be unlocked with active management and capital
investment as well as further acquisition opportunities to
supplement the existing Insight business.
BACKGROUND ON INSIGHT
Insight is a data science and machine learning solutions company
that provides bespoke web-based applications, advanced analytical
tools and modern technology infrastructure to make machine learning
accessible to investment professionals.
Insight was co-founded by Steve Cracknell and Warren Pearson who
had previously worked together at Goldman Sachs in the early 2000s
and then again in 2013 when they took over the running of a machine
learning start-up based in Silicon Valley. On returning to London
in 2017, they established Insight to develop solutions for the
asset management industry.
Insight began its journey as an artificial intelligence
consultancy that combined quantitative research, data engineering
and machine learning to deliver bespoke analytical tools to the
asset management industry. Much of the focus in the early years was
on assisting clients to transition to data-driven investing
strategies, supported by modern machine learning, data storage and
cloud-computing capabilities. Early customers of Insight included
CarVal Investors, HPS, Lodbrok Capital and a large European Family
Fund.
During this period, Insight developed various product solutions
for its clients enabling them to apply machine learning to optimise
their investment and operational performance, including:
-- Equity portfolio and feature optimisation : Using a scalable
cloud infrastructure and non-linear machine learning techniques,
Insight enabled a large European asset manager to construct over a
million sample portfolios to test their existing fundamental
investment hypotheses - optimising their factor selection and fast
tracking the launch of a new global equity fund.
-- Credit rating downgrade modelling : Analysed hundreds of
fundamental factors over 80 quarters and across approximately 3,000
public companies using multiple machine learning models to rank
investment features most likely to predict a credit rating
downgrade; the modelling resulted in a sixfold increase in
predicting rating downgrades of the top versus bottom deciles.
-- RMBS portfolio arbitrage and optimisation : Using a
hyper-parameter machine learning algorithm to accelerate portfolio
exploration and target tranche identification, resulted in a
ten-times increase in trade flow, a 25 per cent. reduction in
operating costs and improved portfolio performance.
-- Visualisation & strategy bias identification : Intuitive
data visualisations highlighted to a global equity investor,
financial feature biases inherent in the fund manager's investment
process: Demonstrating a regional bias toward high growth emerging
markets, sectoral bias toward low debt service industries and a
factor bias via unrecognised correlation between proprietary
features.
-- Feature importance : Applied machine learning to cut noise
and irrelevant features from an asset manager's global equity
portfolio data set, thereby reducing operational risk and focusing
their research on core features in line with their stated
investment aim.
-- Centralised data gateway : Consolidated disparate and siloed data sources into an AWS cloud infrastructure, API data gateway and multi-source web application; this resulted in a 30 per cent. increase in operational efficiency and modern tech stack infrastructure.
Through this experience it became increasingly evident to
Insight that the underlying challenges faced by asset managers when
seeking to evolve to more data-driven business and investing
strategies, could be solved through a core set of modular
applications, that can be adapted to serve client specific
requirements. Consequently, in late 2019, Insight made the
strategic decision to focus on developing proprietary software
solutions for asset managers and migrate away from pure AI
consulting.
Insight has developed five products specifically aimed at
accelerating an asset manager's data science and machine learning
strategy. Insig Portfolio and Insig Data are in production and
currently being used by clients. Insig Docs and Exceleton are being
beta tested with client data and Insig ESG will be launched and
ready for use in the second quarter of 2021. As part of the
development roadmap, Insight has a series of product enhancements
and new features underway.
Insight's products and services provide the key components
needed for a modern, data-driven investing strategy:
-- Data strategy development : Assess current data availability,
data-driven strategy and commercial opportunities and
implementation framework;
-- Technology & cloud infrastructure : Explore existing
technology and cloud capabilities, suitability and
optimisation;
-- Data ingestion : Transform, index and structure data into a
client-specific data warehouse available for Insight and other
machine learning applications;
-- Machine learning and analytics : Enable data interrogation,
analysis and insights by leveraging machine learning algorithms
supported by an efficient and scalable cloud computing
infrastructure; and
-- Data visualisation : Present findings in an accessible and
transparent way to enable clients to achieve alpha and other
commercial results.
The development of these products has been guided by Insight's
experience in providing data-science solutions to its clients, many
of whom have already or are expected to become early users of the
newly developed products.
SUMMARY HISTORICAL FINANCIAL INFORMATION
The table below sets out Insight's summary audited financial
information for the periods indicated, in accordance with IFRS and
has been extracted from the historical financial information on
Insight as set out at Part III of the Admission Document. In order
to make a proper assessment of the financial performance of
Insight's business as well as that of the Enlarged Group,
Shareholders and prospective investors should read the Admission
Document as a whole and not rely on the key or summarised
information below:
GBP'm FY18 FY19 FY20 HY21
Revenue 0.0 0.9 2.7 1.0
EBITDA (0.1) 0.3 0.7 0.2
Development of internally generated
intangible
assets capitalised in the period 0.3 1.2 0.9 1.0
Average number of employees (including
the
executive directors of Insight) 6 6 9 12
Revenue generated throughout FY18 to HY21 related to consulting
income. However, in FY20, Insight made the strategic decision to
focus on developing proprietary software solutions for asset
managers and migrate away from pure AI consulting. This, together
with the impact of Covid-19, resulted in the fall in pro-rata
revenue in HY21. Insight's net assets for FY20 totalled GBP4.2m and
for HY21 totalled GBP4.5m.
REASONS FOR THE ACQUISITION AND USE OF PROCEEDS OF THE
PLACING
The Directors believe that the Acquisition represents an
important step in the Group's development. The net proceeds of the
Placing will principally be used by the Company to pay the Cash
Consideration and for general working capital purposes, namely
investing in Insight's teams of developers, engineers and sales and
marketing employees to accelerate its product and business
development activities.
BOARD OF DIRECTORS AND SENIOR MANAGEMENT
Brief biographical details of the existing Board are set out
below:
Matthew Todd Farnum-Schneider , Chief Executive Officer and
Interim Chairman, Proposed Executive Chairman, aged 47
Matthew is an experienced senior executive, having most recently
been a Managing Director and Senior Adviser to the CEO at Credit
Suisse between 2015-2019, prior to which he was Managing Director
and head of corporate strategy at Prudential plc. He was a founder
and inaugural Chairman of the Global Infrastructure Investor
Association, which under his leadership grew to become the leading
advocacy association for the infrastructure investor community
representing more than 70 investors representing more than $650
billion in assets. Between 2009-2013, Matthew served in President
Obama's administration both as Director of International Economics
for the White House National Security Council and as COO of the
International Development Finance Corporation. Earlier in his
career he structured derivative hedging solutions at Barclays
Capital and the Royal Bank of Scotland and served in President
Clinton's White House as a senior adviser.
Matthew has been Chief Executive Officer of Catena since 1
August 2019 and Interim Chairman since 30 March 2020.
David Hillel, Finance Director, aged 85 (Resigning at General
Meeting)
David Hillel qualified as a chartered accountant in 1966. He was
a senior partner at Auerbach Hope, chartered accountants a firm
which was established for more than 45 years. From 1990-1997 he was
finance director of Middlesex Holdings plc and is currently in
private practice as a chartered accountant. David has been the
Finance Director of Catena since 31 December 2006.
John Christopher Murray, Independent Non-Executive Director,
aged 56
John Murray was most recently a Managing Director at Credit
Suisse acting as Senior Adviser to the CEO. He joined Credit Suisse
in 2015 from Prudential plc where he served as Group Director of
Communications and member of the Group Executive Committee. John
was previously Director of Communications at the Financial Services
Authority, a founding partner of London-based financial PR
consultancy, Powerscourt Limited, and Director of Strategy and
Communications at Telewest plc (now part of Virgin Media). Prior to
this, John had a successful career in journalism, culminating in
the position of Executive Editor of The Daily Express. John is
currently a senior advisor to AIM listed activist fund, Crystal
Amber Fund, alongside holding the position of Trustee for the
Barbican Centre.
John was appointed as a Non-Executive Director of Catena on 27
May 2020.
David John Coldbeck , Non-Executive Director, aged 74 (Resigning
at General Meeting)
David Coldbeck worked for HSBC Bank plc for 32 years during
which time he undertook various managerial roles in Retail and
Corporate Banking. His final appointment was as an Area Director in
London which he held for nine years prior to his retirement in
1999. David holds other directorships in private companies.
David was appointed as a Non-Executive Director of Catena on 26
November 1999.
John Zucker , Non-Executive Director, aged 71 (Resigning at
General Meeting)
John Zucker is a solicitor and was a founder and the managing
partner of Roiter Zucker for over 30 years. He continues to
practice as a consultant solicitor. John is also a trustee of a
charitable trust.
John was appointed as a Non-Executive Director of Catena on 26
November 1999.
Assuming the Resolutions are passed, the following Proposed
Directors will be appointed to the Board:
Steven (Steve) Wallace Cracknell , Proposed Chief Executive
Officer, aged 46
Steve began his career with Thomson Reuters before being
headhunted to work at Goldman Sachs. Steve worked at Goldman Sachs
for nearly 10 years developing strategic analytical tools for use
across the global investment bank, from Sales and Trading
applications to front end website optimisation for clients. Steve
latterly led a global team for Goldman Sachs in relation to Sales
Technology before leaving in 2012 to become an entrepreneur. In
2013, Steve became CPO of Zenti, Inc., a Silicon Valley based
tech-start-up focussing on big data analytics solutions, utilising
human pattern recognition and machine intelligence. He subsequently
relocated to California and took on the role of CEO. These products
were successfully used by The United States Senate (Permanent
Subcommittee for Investigation) as part of a major financial fraud
investigation and the National Veterans Foundation for a Veteran
Suicide Prevention campaign. Steve left Zenti in 2016 to focus on
artificial intelligence and machine learning within the financial
markets space, before co-founding Insight with Warren Pearson in
2017.
Warren Paul Pearson , Proposed Chief Technical Officer, aged
52
Warren began his career working as a programmer for the British
Civil Service in 1992, before writing code in the telecoms industry
and then for a series of investment banks. Moving to Goldman Sachs
in 1999, he worked initially in Global Economic Research in London
and subsequently for the Firmwide Internet Group in New York. His
principal responsibilities were to develop and support the firm's
institutional client-facing website, and to oversee the digital
distribution of all client research globally. Warren left Goldman
Sachs in 2011 after 12 years to pursue free-lance projects for
clients including Barclays and the London Stock Exchange. In 2012,
Warren joined Steve Cracknell at Zenti Inc, a Silicon Valley based
tech-start-up as DevOps Engineer, strengthening the company's
artificial intelligence and machine learning capabilities. In 2017,
Warren co-founded Insight with Steve Cracknell and assumed the role
of Chief Technical Officer, overseeing the company's software
engineering proposition.
Peter Lee Rutter , Proposed Independent Non-Executive Director,
aged 41
Peter is head of equities at Royal London Asset Management
(RLAM) as well as head of the global equities team, and a senior
portfolio manager with over 14 years of experience. Before joining
RLAM, Peter was head of global equities at Waverton Investment
Management. Prior to this, he was a partner at IronBridge Capital
Management for six years, where he co-managed the GBP3 billion
IronBridge Global Select equity strategy. Previously, he worked
closely with Kenney in the global equities team at Deutsche Asset
Management. Peter graduated from Christ's College, Cambridge
University, with a starred double first class degree in Geography.
He is a CFA charter holder and a chartered management accountant
(CGMA).
Senior management (non -Board )
Key members of the Enlarged Group's senior management team
are:
Ashley Michelle Humphrey, Chief Financial Officer, aged 34
Ashley joined Catena as Chief Financial Officer in March 2021
having previously spent the majority of her career with Aon
Corporation latterly as the Head of Finance EMEA in London. She
began her career with Aon in Chicago, USA, where she held the
position of Financial Specialist for Global Corporate Real Estate.
Ashley subsequently moved to Hong Kong to align local countries and
global corporate teams across the Aon network and implement new
financial structures. Following her period in Hong Kong, Ashley
moved to Singapore and oversaw Aon's accounts reporting for total
operating revenue of $1bn annually. Whilst at Aon Ashley gained
qualifications as a certified public accountant, certified
management accountant and a chartered global management
accountant.
It is expected that Ashley will be appointed to the Board within
six months from Admission.
Sachin Kachhla , Director of Sales, aged 42
Sachin joined Insight as Director of Sales in February 2021,
based in New York. Sachin's primary responsibility is to implement
and accelerate Insight's sales strategy. Sachin is an experienced
sales executive, most recently holding the position of Managing
Director, Head of Sales for Indus Valley Partner, New York, USA.
Sachin specialises in sales of financial technology for the
alternative and traditional asset management space. Prior to Indus
Valley Partners, he held the position of Director of Business
Development Eze Software Group and brings over 20 years of
experiences in sales roles.
Proposed Directors' Service Agreements
The Company and Matthew Farnum-Schneider entered into a service
agreement on 20 April 2021 ("Executive Agreement") pursuant to
which Mr Farnum-Schneider agreed to act as Executive Chairman of
the Company. Mr Farnum-Schneider is entitled to a salary of
GBP260,000 per annum.
The Company and Steven Cracknell have agreed the terms of a
service agreement which will be automatically entered into on
Admission pursuant to which Mr. Cracknell has agreed to act as
Chief Executive of the Company. Mr. Cracknell will be entitled to a
salary of GBP260,000 per annum.
The Company and Warren Pearson have agreed the terms of a
service agreement which will be automatically entered into on
Admission pursuant to which Mr. Pearson has agreed to act as Chief
Technical Officer of the Company. Mr. Pearson will be entitled to a
salary of GBP260,000 per annum.
John Murray entered into a letter of appointment with the
Company dated 20 April 2021 to act as a non-executive director. The
only material change from Mr. Murray's previous letter of
appointment is the increase of his annual fee from GBPnil to
GBP35,000.
The Company and Peter Rutter have agreed the terms of a letter
of appointment to act as a non-executive director with such
appointment to take effect from the time of Admission. Mr. Rutter
shall be entitled to an annual fee of GBP35,000 gross.
THE ACQUISITION AGREEMENT, THE MINORITY ACQUISITION AGREEMENTS
AND INSIGHT OPTION HOLDERS
The Company has entered into a conditional share purchase
agreement dated 20 April 2021 with the Principal Insight Sellers,
which provides that, upon the satisfaction of certain conditions,
including Admission and the passing of the Resolutions, the Company
will acquire the Insight Shares owned by the Principal Insight
Sellers. The Acquisition Agreement contains warranties on the part
of Steve Cracknell and Warren Pearson in favour of the Company in
relation to the business, assets and taxation of Insight. In
addition, the Company is giving Steven Cracknell and Warren Pearson
the benefit of warranties about the business and assets of the
Group.
The Company has also entered into a conditional share purchase
agreement with each of the Minority Insight Sellers dated 20 April
2021. Each of these agreements is identical (other than in respect
of the number of Insight Shares to be sold and the amount and form
of consideration to be received) and provides that upon the
satisfaction of certain conditions, including Admission and the
passing of the Resolutions, the Company will acquire those Insight
Shares held by that selling Minority Insight Seller. The Minority
Sellers are only giving the Company warranties in respect of their
title to the relevant Insight Shares and their capacity to enter
into the relevant Minority Acquisition Agreement.
In addition, employees of Insight holding options over 1,375
Insight Shares under the Insight Capital Partners Limited
Enterprise Management Incentive Scheme have been notified by
Insight of the Acquisition and invited to exercise their options
and transfer their resulting Insight Shares to the Company,
conditional on Admission and the passing of the Resolutions. In
return the Insight Option Holders will be entitled to receive, in
aggregate, up to 7,121,976 Consideration Shares and, depending on
the number of Consideration Shares that the Insight Option Holders
acquire, up to GBP0.3 million of the Cash Consideration pursuant to
the Option Exercise Documents. If the Insight Option Holders fail
to exercise their options over Insight Shares then these will lapse
on Admission.
PUBLICATION OF ADMISSION DOCUMENT, GENERAL MEETING AND
ADMISSION
The Company has today published its Admission Document with a
notice convening a General Meeting which is available to view on
its website at www.catenagroup.co.uk. The Admission Document will
be posted, or notified electronically as the case may be, to
Shareholders later today. The Ordinary Shares were suspended from
trading on AIM on 3 September 2020. With the publication of the
Admission Document today, trading in the Company's Ordinary Shares
on AIM will be restored at 7.30 a.m. today.
The General Meeting to approve the Resolutions in relation to,
inter alia, the Acquisition, waiver of obligations of the Concert
Party to make a mandatory offer for the Company pursuant to Rule 9
of the City Code on Takeovers and Mergers and the Placing, will be
held as a closed meeting at 23 King Street, London, SW1Y 6QY at
9.00 a.m. on 7 May 2021. Given the Government's current guidelines
on COVID-19, Shareholders wishing to vote on any matters of
business are strongly urged to do so through the completion of a
form of proxy as there will be no ability to attend in person. A
summary of the action the Shareholders should take is set out in
the Admission Document.
PROPOSED CHANGE OF NAME
Catena has proposed to change its name to Insig AI plc following
the Resolutions being approved by Shareholders. The change of name
will become effective once the Registrar of Companies has issued a
new certificate of incorporation on the change of name. The TIDM of
the Company is expected to change to AIM:INSG shortly after the
change of name has become effective.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Publication and posting of this Document (including Notice of 21
April 2021
General Meeting and the Form of Proxy)
Existing Ordinary Shares recommence trading on AIM 21 April
2021
Latest time and date for receipt of completed Forms of Proxy and
9.00 a.m. on 5 May 2021
receipt of electronic proxy appointments via the CREST
system
General Meeting 9.00 a.m. on 7 May 2021
Announcement of the results of the General Meeting 7 May
2021
Admission of the New Ordinary Shares 8.00 a.m. on 10 May
2021
THE TAKEOVER CODE AND TAKEOVER PRINCIPLES
The Company is incorporated in England and its Ordinary Shares
will be admitted to trading on AIM.
Accordingly, the Takeover Code applies to the Company.
Under Rule 9 of the Takeover Code, any person who acquires,
whether by a series of transactions over a period of time or not,
an "interest" (as defined in the Takeover Code) in shares which,
taken together with shares in which he is already interested or in
which persons acting in concert with him are interested, carry 30
per cent. or more of the voting rights of a company which is
subject to the Takeover Code, that person is normally required to
make a general offer to all of the remaining shareholders to
acquire their shares.
On the basis that the Concert Party will be interested in
Ordinary Shares carrying not less than 30 per cent. of the voting
rights in the Company but not hold Ordinary Shares carrying more
than 50 per cent. of such voting rights, the acquisition by any
member of the Concert Party of any interest in the Ordinary Shares
which increases the percentage of Ordinary Shares carrying voting
rights would give rise to an obligation upon the Concert Party to
make an offer for the entire issued share capital of the
Company.
An offer under Rule 9 must be in cash or be accompanied by a
cash alternative and must be at the highest price paid by the
person required to make the offer, or any person acting in concert
with him for any interest in shares of the company in question
during the 12 months prior to the announcement of the offer.
The Takeover Code defines persons "acting in concert" as
comprising persons who, pursuant to an
agreement or understanding (whether formal or informal),
co-operate to obtain or consolidate control of a company or to
frustrate the successful outcome of an offer for a company.
"Control" means an interest, or interests, in shares carrying in
aggregate 30 per cent. or more of the voting rights of a company,
irrespective of whether such interest or interests give de facto
control. A person and each of its affiliated persons will be deemed
to be acting in concert with each other. There is a non-exhaustive
list of persons who will be presumed to be acting in concert with
other persons in the same category unless the contrary is
established.
This list includes:
(a) the close relatives of a founder of a company to which the
Takeover Code applies and the related trusts of any of them, all
with each other; and
(b) shareholders in a private company who sell their shares in
that company in consideration for the issue of new shares in a
company to which the Takeover Code applies or who, following the
re-registration of that company as a public company in connection
with an initial public offering or otherwise, become shareholders
in a company to which the Takeover Code applies.
Accordingly, all Insight Shareholders who become shareholders in
the Company will be presumed to be acting in concert due to the
circumstances set out in (b) above. However, the Company's advisers
have liaised with the Panel and, based on the information
available, the Company has agreed with the Panel that only the
Principal Insight Sellers, Clive Mann and Mark Woodhouse ( Concert
Party ) should be presumed to be acting in concert. The members of
the Concert Party together will hold up to 36.6 2 per cent. of the
Enlarged Share Capital immediately following Admission.
The Company has applied to the Panel for a waiver of Rule 9 in
order to permit the Acquisition without
triggering an obligation on the part of the Concert Party to
make a general offer to Shareholders. The Panel has agreed to waive
the obligation of the Concert Party to make a general offer for the
entire issued share capital of the Company that would otherwise
arise on the issue and allotment of the Consideration Shares
subject to the passing by the Independent Shareholders of the
Whitewash Resolution at the General Meeting. No members of the
Concert Party hold Existing Ordinary Shares and, therefore, none of
them are entitled to vote at the General Meeting in respect of the
Whitewash Resolution.
The Rule 9 Waiver will be invalidated if any purchase of
Ordinary Shares is made by any member of the Concert Party or by
any person acting in concert with any of them in the period between
the date of this Document and the General Meeting. No member of the
Concert Party currently has any interest in or any right to
subscribe for any Ordinary Shares (other than as a result of having
entered into the Acquisition Agreement or a Minority Acquisition
Agreement (as the case may be) and no member of the Concert Party
has dealt in any Ordinary Shares during the 12 month period prior
to the date of this Document.
Should the Concert Party acquire any further interest in the
Ordinary Shares or should any individual member of the Concert
Party acquire any interest in the Ordinary Shares such that they
are interested in 30 per cent. or more of the voting rights of the
Company, the Panel may regard this as giving rise to an obligation
upon the Concert Party or such individual member of the Concert
Party (as the case may be) to make an offer for the entire issued
share capital of the Company at a price no less than the highest
price paid by the Concert Party or such individual member of the
Concert Party in the previous 12 months. If the Resolutions are
passed and the Acquisition completes, the Concert Party will not be
restricted from making an offer for the entire issued share capital
of the Company in the future.
Further details of the Concert Party, the relationship of each
member of the Concert Party with each other and their respective
holdings before and after the completion of the Proposals is set
out in Part V ( Additional Takeover Code Disclosures for the
Purpose of the Rule 9 Whitewash ) of the Admission Document.
2 Based upon the Enlarged Share Capital if the Insight Option
Holders allow their options to lapse and therefore receive no
Consideration Shares.
-ENDS-
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ACQLFLBLFZLEBBL
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