TIDMADVT TIDMSAA
RNS Number : 3521Z
Advancedadvt Limited
24 January 2022
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR PART,
IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
THIS IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER
UNDER RULE 2.7 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE
"CODE") AND THERE CAN BE NO CERTAINTY THAT AN OFFER WILL BE MADE,
NOR AS TO THE TERMS ON WHICH ANY OFFER WILL BE MADE.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
24 January 2022
AdvancedAdvT Limited
("AdvancedAdvT" or the "Company")
Potential merger - improved terms
Further to its announcement of 7 January 2022 regarding its
interest in exploring a share exchange merger with M&C Saatchi
plc ("M&C" or "M&C Saatchi") (the "Potential Merger"), the
Company confirms that, having met with M&C on 17 January 2022
and reflected on the feedback M&C provided on our Original
Proposal (defined below), the Company proposed an improved set of
terms on 19 January 2022 (the "Improved Terms").
The Board of AdvancedAdvT believe this is a truly beneficial
merger; it provides significant investment and additional expertise
to build on the existing M&C platform, seeking to drive
M&C's future growth at significantly greater pace for the
benefit of all stakeholders.
The Company was informed yesterday evening that the independent
directors of M&C Saatchi had rejected the Improved Terms. The
Company is considering its options.
The Improved Terms for the M&C shares subject to the
Potential Merger proposed to M&C were:
either :
2.245 new AdvancedAdvT Limited shares for each M&C Saatchi
ordinary share
-- This represents a 20.7 per cent increase on the 1.86 share
exchange ratio proposed in a confidential letter to the Board of
M&C Saatchi dated 6 January 2022 (the "Original Proposal")
-- M&C Saatchi shareholders, excluding the 12 million
M&C shares already owned by AdvancedAdvT, would own
approximately 65 per cent. of the Company as enlarged by the
Potential Merger.
or:
1.633 new AdvancedAdvT Limited shares and 40 pence in cash for
each M&C Saatchi ordinary share
-- M&C Saatchi shareholders would own approximately 57 per
cent. of the Company as enlarged by the Potential Merger, excluding
the 12 million M&C shares already owned by AdvancedAdvT
-- With a mix and match facility to allow shareholders an
element of choice in the form of consideration they could
receive.
Merger rationale
As outlined in its announcement of 7 January 2022, the Board of
the Company believes that the enlarged group would have the
opportunity to create significant value for its then shareholders
and that a merger would create an opportunity to build a data,
analytics and digitally focussed creative marketing business with a
strong balance sheet and additional management with expertise in
transforming businesses at pace and execute on complementary
M&A. These attributes would enable the evolution, and most
importantly, the acceleration, of the enlarged group's digital and
data capabilities, creating adjacent addressable market opportunity
and strengthening the strategic ongoing relationship and
commitments with its customers and prospective customers.
Proposed board structure
The Improved Terms reaffirmed the proposed board structure as
set out in the Company's Original Proposal, albeit the Company
notes M&C Saatchi's announcement of 19 January 2022 regarding
the resignation of CFO, Mickey Kalifa.
Reflecting this change, the proposed board structure as enlarged
by the Potential Merger would comprise Moray MacLennan as CEO, an
Executive Director responsible for Data, Analytics & Digital
Transformation, a CFO to be appointed and Gavin Hugill as COO. The
rest of the board would comprise Vin Murria as Chairperson and a
number of the current Non-Executive Directors from the current
boards of AdvancedAdvT and M&C Saatchi. The Company's intention
would be for the board as enlarged by the Potential Merger to
comprise a majority of independent directors.
AIM
The Company had also proposed to commit to moving AdvT's listing
to AIM as soon as is practicable, with the intention that
consideration shares provided to current M&C Saatchi
shareholders would be AIM listed.
The Company believes the merger provides M&C with
significant investment capital at a significant premium to the
undisturbed 30 day (to 5 January 2022) trading volume weighted
average price of 160 pence, even before taking into account any
issue discount. We believe M&C has executed well in recent
years, with particular focus on addressing issues raised in 2019.
However, we view the capital provided for the enlarged group is
important to fuel investment, and subsequent growth, in existing
business lines alongside the growing data and digital opportunity,
whilst simultaneously also enabling the enlarged group to address
the put options and their ongoing drag on performance and cash
flow.
The Company has a Long Term Incentive Plan ("LTIP"), to ensure
an alignment with all shareholders, that is performance based on
the long term performance of the Company's shares and will only
reward the participants if shareholder value is created.
Participants are expected to include senior executives of acquired
companies. The Company believes such schemes deliver benefit to all
stakeholders including shareholders, being: proportionate,
transparent, performance based and driving sustainable value
creation. Further details of the LTIP were included in the
Company's prospectus dated 18 March 2021.
This announcement has been made without the prior consent of
M&C Saatchi.
There can be no certainty that any formal offer for M&C will
be forthcoming.
Notes
As announced on 5 January 2022, AdvancedAdvT acquired 12,000,000
ordinary shares of M&C for a price of GBP2.00 per share,
representing c.9.82 per cent. of the current issued share capital
of M&C. If the Company makes a formal offer, a value of at
least equivalent to GBP2.00 per share must be offered under the
Code.
Vin Murria OBE, Chairman of the Company and a non-executive
director of M&C, owns 15,237,985 ordinary shares in M&C,
representing 12.46% and 17,500,000 ordinary shares in the Company,
representing 13.26% .
The Company's pre suspension share price was 98 pence per
share.
The person responsible for arranging the release of this
announcement on behalf of the Company is Antoinette Vanderpuije,
the Company Secretary of the Company. The LEI of the Company is
254900WYO35S1T334A28.
Enquiries:
Company Secretary
Antoinette Vanderpuije 020 7004 2743
Meare Consulting (Financial PR to the Company)
Adrian Duffield 07990 858548
Investec Bank plc (Financial adviser to the Company)
Christopher Baird 020 7597 5970
Alex Wright
Carlton Nelson
Further information on the Company can be found on its website
at www.advancedadvt.com. Neither the content of the Company's
website, nor the content on any website accessible from hyperlinks
on its website or any other website, is incorporated into, or forms
part of, this announcement nor, unless previously published by
means of a regulatory information service, should any such content
be relied upon in reaching a decision as to whether or not to
acquire, continue to hold, or dispose of, securities in the
Company.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in
1% or more of any class of relevant securities of an offeree
company or of any securities exchange offeror (being any offeror
other than an offeror in respect of which it has been announced
that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer
period and, if later, following the announcement in which any
securities exchange offeror is first identified. An Opening
Position Disclosure must contain details of the person's interests
and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) applies must be made by no later than
3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later
than 3.30 pm (London time) on the 10th business day following the
announcement in which any securities exchange offeror is first
identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any securities exchange offeror must make a
Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any securities exchange offeror. A
Dealing Disclosure must contain details of the dealing concerned
and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror(s), save to the
extent that these details have previously been disclosed under Rule
8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies
must be made by no later than 3.30 pm (London time) on the business
day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the 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.
Website
In accordance with Rule 26.1 of the Code, a copy of this
announcement will be available free of charge on the Company's
website: www.advancedadvt.com promptly following its publication
and in any event by no later than 12 noon on the following business
day . The content of the websites referred to in this announcement
is not incorporated into and does not form part of this
announcement.
Important notices
Investec Bank plc, which is authorised in the United Kingdom by
the Prudential Regulation Authority and regulated by the Financial
Conduct Authority and the Prudential Regulation Authority, is
acting as financial adviser to the Company and no-one else in
connection with the subject matter of this announcement and will
not be responsible to anyone other than the Company for providing
the protections afforded to its clients or for providing advice in
connection with the subject matter of this announcement.
This announcement is for information purposes only. It does not
constitute an offer or form part of any offer or an invitation to
purchase, subscribe for, sell or issue any securities or a
solicitation of any offer to purchase, subscribe for, sell or issue
any securities pursuant to this announcement or otherwise in any
jurisdiction in which such offer or solicitation is unlawful. The
distribution of this announcement in jurisdictions outside the
United Kingdom may be restricted by law and therefore persons into
whose possession this announcement comes should inform themselves
about, and observe such restrictions. Any failure to comply with
the restrictions may constitute a violation of the securities law
of any such jurisdiction.
Overseas Shareholders
The release, publication or distribution of this announcement in
or into certain jurisdictions other than the United Kingdom may be
restricted by law and therefore any persons who are subject to the
laws of any jurisdiction other than the United Kingdom should
inform themselves about, and observe, any applicable
requirements.
To the fullest extent permitted by applicable law, the C ompany
disclaims any responsibility or liability for the violation of such
restrictions by any person. This announcement has been prepared for
the purpose of complying with English law 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 of England and Wales.
Copies of this announcement shall not be, and must not be,
mailed or otherwise forwarded, distributed or sent in, into or from
any Restricted Jurisdiction or any jurisdiction where to do so
would violate the laws of that jurisdiction and persons receiving
such documents (including custodians, nominees and trustees) must
not mail or otherwise forward, distribute or send them in, into or
from any Restricted Jurisdiction.
Forward Looking Statements
This announcement (including any information incorporated by
reference in this announcement), oral statements made regarding
this announcement, and other information published by the Company
may contain statements which are, or may be deemed to be, "forward
looking statements". Such forward looking statements are
prospective in nature and are not based on historical facts, but
rather on current expectations and on numerous assumptions
regarding the business strategies and the environment in which the
Company or the enlarged group shall operate in the future and are
subject to risks and uncertainties that could cause actual results
to differ materially from those expressed or implied by those
statements. The forward-looking statements contained in this
announcement relate to the Company or the enlarged group's future
prospects, developments and business strategies. In some cases,
these forward looking statements can be identified by the use of
forward looking terminology, including the terms "believes",
"estimates", "will look to", "would look to", "plans", "prepares",
"anticipates", "expects", "is expected to", "is subject to",
"budget", "scheduled", "forecasts", "synergy", "strategy", "goal",
"cost-saving", "projects" "intends", "may", "will" "shall" or
"should" or their negatives or other variations or comparable
terminology. Forward-looking statements may include statements
relating to the following: (i) future capital expenditures,
expenses, revenues, earnings, synergies, economic performance,
indebtedness, financial condition, dividend policy, losses and
future prospects of the Company or the enlarged Group; (ii)
business and management strategies and the expansion and growth of
the Company's operations and potential synergies resulting from a
merger with M&C Saatchi; and (iii) the effects of global
economic conditions and governmental regulation on the Company's,
or M&C Saatchi business. By their nature, forward-looking
statements involve risk and uncertainty because they relate to
events and depend on circumstances that shall occur in the future.
These events and circumstances include changes in the global,
political, economic, business, competitive, market and regulatory
forces, future exchange and interest rates, changes in tax rates
and future business combinations or disposals. If any one or more
of these risks or uncertainties materialises or if any one or more
of the assumptions prove incorrect, actual results may differ
materially from those expected, estimated or projected. Such
forward looking statements should therefore be construed in the
light of such factors. Neither the Company, nor any of its
respective associates or directors, officers 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 shall actually occur. Given these risks and
uncertainties, potential investors should not place any reliance on
forward looking statements.
Specifically, statements of estimated cost savings and synergies
relate to future actions and circumstances which, by their nature
involve, risks, uncertainties and contingencies. As a result, the
cost savings and synergies referred to may not be achieved, may be
achieved later or sooner than estimated, or those achieved could be
materially different from those estimated. Due to the scale of the
enlarged group, there may be additional changes to the enlarged
group's operations. As a result, and given the fact that the
changes relate to the future, the resulting cost synergies may be
materially greater or less than those estimated.
The forward-looking statements speak only at the date of this
announcement. All subsequent oral or written forward-looking
statements attributable to any member of the Company, or any of its
respective associates, directors, officers, employees or advisers,
are expressly qualified in their entirety by the cautionary
statement above.
The Company expressly disclaims any obligation to update such
statements other than as required by law or by the rules of any
competent regulatory authority, whether as a result of new
information, future events or otherwise.
No profit forecasts or estimates
No statement in this announcement is intended as a profit
forecast or estimate for any period and no statement in this
announcement should be interpreted to mean that earnings or
earnings per share for the Company or M&C Saatchi, as
appropriate, for the current or future financial years would
necessarily match or exceed the historical published earnings or
earnings per share for the Company or M&C Saatchi, as
appropriate.
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END
OFDSELSMLEESEIF
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January 24, 2022 02:00 ET (07:00 GMT)
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