TIDMSBD
RNS Number : 3132D
Songbird Estates PLC
28 January 2015
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH
JURISDICTION
Songbird Estates plc (the "Company" and "Songbird")
Ordinary Shares of 10 pence each ("Ordinary Shares")
ISIN code GB00B4MTF637
For immediate release
28 January 2015
Update on Board recommendation
On 12 January 2015, the Board published its response circular
(the "Response Circular") in connection with the final offer made
by an entity jointly controlled by QIA and Brookfield to acquire
the entire issued and to be issued share capital of the Company at
a price of 350 pence per Songbird Share.
In the Response Circular, the Board advised Shareholders that
the Company's largest three Shareholders (excluding QIA), namely
the Glick Shareholder, China Investment Corporation and the MS
Shareholder (the "Major Shareholders") had each informed the Board
that they were at that time continuing to evaluate the Offer and
had not reached a decision on whether or not to accept it.
The Board further stated that if one or more of the Major
Shareholders were to accept the Offer, the Offer could become or be
declared unconditional, leaving any remaining minority Shareholders
with a high degree of uncertainty as to how and at what value they
would be able to realise their investment and with a risk that
Songbird could cease to be listed on AIM. Furthermore, the Board
noted that if one or more of the Major Shareholders were to accept
the Offer, this would be a material new fact which the Board would
have to consider in determining what further recommendation to make
to Shareholders.
It is now the Board's understanding that each of the Major
Shareholders intends to accept the Offer.
On that basis, and assuming that all of the Songbird Shares in
respect of which Brookfield and QIA have received an irrevocable
undertaking or letter of intent are also accepted into the Offer
and the Offer is declared wholly unconditional, QIA and Brookfield
would hold, in aggregate, at least 633,769,575 Songbird Shares,
representing approximately 85.60% of the existing issued ordinary
share capital of Songbird.
In light of this, the Board wants to make Shareholders aware of
the following factors when Shareholders consider their decision on
whether or not now to accept the Offer.
Factors for consideration by Shareholders
Price
The Board, which has been so advised by Rothschild, Morgan
Stanley and J.P. Morgan Cazenove, continues to believe that the
Offer does not reflect the full value of the business, its unique
operating platform and its prospects.
Other potential acquirors
Since the announcement of the Offer on 4 December 2014, the
Board has engaged in discussions with a number of parties with a
view to achieving a higher offer for the benefit of all
Shareholders. No such offer has been forthcoming to date and the
Board believes that none will now be forthcoming before the first
closing date of the Offer on 29 January 2015.
Governance changes
In their Offer Document, QIA and Brookfield stated that a
material factor in their decision as to whether or not to waive
down their 90% acceptance condition would be the agreement or
refusal of the Board to implement their proposed changes to the
existing governance arrangements of Songbird set out in the Offer
Document.
However, assuming that the Major Shareholders accept the Offer,
QIA and Brookfield will have the ability to control the composition
of the Board and the governance arrangements of Songbird will
therefore not be an impediment to QIA and Brookfield proceeding
with their Offer.
Possible de-listing and associated risks
If QIA and Brookfield receive acceptances in respect of, or
otherwise acquire 90% or more of the Songbird Shares to which the
Offer relates, and assuming all other conditions of the Offer have
been satisfied or waived, QIA and Brookfield intend to exercise
their right pursuant to the provisions of Chapter 3 of Part 28 of
Companies Act 2006 to acquire compulsorily the remaining Songbird
Shares.
QIA and Brookfield have said in their Offer Document that, if
sufficient acceptances are not received to allow the implementation
of such squeeze-out procedure, they will consider whether it is
appropriate and relevant to maintain Songbird's listing on AIM
subject to Songbird continuing to satisfy AIM eligibility
requirements.
Consequently, there is no guarantee that Songbird's listing on
AIM will be maintained and there is therefore a risk that
Shareholders who do not accept the Offer could, as a result, own a
minority interest in an unlisted company controlled by QIA and
Brookfield and would no longer be afforded the protections
available to them whilst the Company remains a listed public
company.
Cancellation of the listing will significantly reduce the
liquidity and marketability of the Songbird Shares and the value of
Songbird Shares may therefore be significantly adversely
affected.
QIA and Brookfield will also be free to increase their
shareholding through individual acquisitions from Shareholders
without any obligation to make a further offer to all Shareholders.
This may further adversely affect the liquidity of Songbird
Shares.
Recommendation
The Board believes that Shareholders should consider carefully
all of the factors outlined above and, accordingly, that
Shareholders should have regard to their personal circumstances and
the matters set out in this announcement when considering whether
or not to accept the Offer at this stage.
The Board recommends that, in the event that the Offer becomes
or is declared unconditional as to acceptances, Shareholders should
accept the Offer. The Directors who own Songbird Shares in their
personal capacity have decided that, in those circumstances, they
will do the same in respect of their own holdings.
Closing date of the Offer
The Offer will remain open for acceptance until the first
closing date, which will be 1.00 pm (London time) on 29 January
2015 and then, should the Offer become or be declared unconditional
as to acceptances, for at least a further 14 days after that. Full
details of how to accept the Offer are set out in the Offer
Document, published on 30 December 2014.
Shareholders who require assistance in accepting the Offer (or
who require a replacement Form of Acceptance and Election) should
telephone Computershare Investor Services PLC (the receiving agent
for the Offer), on 0870 707 1288 (from within the United Kingdom)
or +44 870 707 1288 (from outside the United Kingdom).
However, Shareholders should be aware that Computershare
Investor Services PLC cannot provide any financial, legal or
taxation advice in connection with the Offer nor any advice on the
merits of the Offer. Shareholders who are in any doubt as to what
action to take are recommended to seek their own personal financial
advice immediately from their stockbroker, bank manager, solicitor,
accountant or other independent financial adviser authorised under
the Financial Services and Markets Act 2000 if they are resident in
the United Kingdom or, if not, from another appropriately
authorised financial adviser in their own jurisdiction.
Terms used in this announcement shall have the meaning given to
them in the Response Circular, unless the context requires
otherwise.
A copy of this announcement is available to view on Songbird's
website at www.songbirdestates.com/investor_relations/offer
Enquiries:
Songbird +44 (0) 20 7477 1000
David Pritchard
John Garwood
Rothschild +44 (0) 20 7280 5000
Alex Midgen
Robert Waddingham
Peter Everest
Morgan Stanley +44 (0) 20 7425 8000
Guy Metcalfe
Nick White
Ian Hart
J.P. Morgan Cazenove (Nominated Adviser
to Songbird) +44 (0) 20 7742 4000
Bronson Albery
Mark Breuer
John Mayne
Brunswick Group +44 (0) 20 7404 5959
Simon Sporborg
Rosheeka Field
Disclaimer
N M Rothschild & Sons Limited ("Rothschild"), which is
authorised by the Prudential Regulation Authority and regulated in
the United Kingdom by the Financial Conduct Authority and the
Prudential Regulation Authority, is acting exclusively for Songbird
and no one else in connection with the matters described in this
announcement and will not be responsible to anyone other than
Songbird for providing the protections offered to clients of
Rothschild nor for providing advice in relation to the subject
matter of this announcement or any other matters referred to in
this announcement.
Morgan Stanley & Co. International plc is acting as
financial adviser to Songbird and no one else in connection with
the matters described in this announcement. In connection with such
matters, Morgan Stanley & Co. International plc, its affiliates
and their respective directors, officers, employees and agents will
not regard any other person as their client, nor will they be
responsible to any other person for providing the protections
afforded to their clients or for providing advice in relation to
any possible transaction, the contents of this announcement or any
other matter referred to herein.
J.P. Morgan Limited (which conducts its U.K. investment banking
business as J.P. Morgan Cazenove and which is authorised and
regulated by the Financial Conduct Authority in the United
Kingdom), is acting exclusively for Songbird in connection with the
Offer and for no one else, and is not, and will not be, responsible
to anyone other than Songbird for providing the protections
afforded to clients of J.P. Morgan Limited or its affiliates, or
for providing advice in relation to the possible offer or any other
matters referred to in this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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