TIDMADVT TIDMSAA
RNS Number : 6911Y
Advancedadvt Limited
08 September 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 ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
8 September 2022
AdvancedAdvT Limited ("ADV")
Acceleration Statement
-- Acceleration Statement: acceptances of ADV's Final Offer must
be received by 1.00pm (London time) on the new Unconditional Date
30 September 2022
-- M&C Saatchi Shareholders have a clear choice with ADV's
Final Offer providing higher value and greater deliverability
within a shorter timetable than Next Fifteen's final offer
-- ADV had a series of positive meetings during July with the
members of the M&C Saatchi Executive Committee. Consequently,
ADV believes that the M&C Saatchi Executive Committee is
committed to M&C Saatchi's future and looks forward to working
with them
-- ADV and Vin Murria do not support the status quo at M&C Saatchi continuing
-- Greater potential: the ADV board believes that its proposals
have greater potential than both NFC and the status quo to deliver
faster growth and significant value creation for M&C Saatchi
Shareholders and employees
-- Proposed cancellation of the standard listing of ADV Shares
on the Official List and proposed admission of ADV Shares to
trading on AIM should ADV's Final Offer Succeed
Acceleration Statement
ADV wishes to bring the Final Offer process to a conclusion and
offer M&C Saatchi Shareholders a clear choice with ADV's Final
Offer providing higher value and greater deliverability within a
shorter timetable than NFC's final offer.
ADV therefore announces that the new Unconditional Date of the
Final Offer is 30 September 2022.
This is an acceleration statement to which Rule 31.5 of the Code
applies ("Acceleration Statement"). Please see the section entitled
"Acceleration Statement - further details" below.
ADV's Final Offer for M&C Saatchi
-- Strategy . ADV's proposals provide a clear opportunity to
accelerate M&C Saatchi's digital growth strategy, organically
and by acquisition.
-- Track record. ADV's board of directors, current and proposed,
offers a track record of shareholder return and expertise
straddling both the creative and digital industries. Christopher
Sweetland, who was Deputy Group Finance director of WPP Group and
Tamara Ingram, who was CEO and Chair of Saatchi and Saatchi UK as
well as the global CEO of J Walter Thompson Worldwide and Paul
Gibson, who was Chief Operating Officer of Advanced Computer
Software, will join the Enlarged Group as non-executive
directors.
-- Resources & experience. ADV currently has more than
GBP100m net cash and had experience on over 85 M&A
transactions. ADV is in talks to put the capital to work, to help
drive and accelerate the Enlarged Group's strategy through
investment in both M&A and organic development. Given the
valuation falls across the wider sector in recent months, ADV's net
cash and M&A expertise is even more valuable in terms of
ability to create future value for the enlarged shareholder
base.
-- Strategy execution. ADV plans to build on M&C Saatchi's
existing brand, culture, 2,650 strong talent base, global
foundations and purpose of 'navigating, creating and leading
meaningful change'. With better access to investment capital it can
build a data, analytics and digitally focussed creative marketing
business attracting the best clients and the best talent in the
industry. An M&A strategy centred around digital
transformation, data analytics and customer experience would be
hugely beneficial to the Enlarged Group's increased growth rates
and potential re-rating.
-- M&C Saatchi Shareholders majority ownership & future
benefits. M&C Saatchi Shareholders are not 'selling' their
group. They will collectively retain majority ownership of between
53.7 per cent. and 59.0 per cent. of the Enlarged Group on a fully
diluted basis, versus a current holding of 77.7 per cent. of the
current issued share capital (when excluding 22.3 per cent. owned
by ADV and Vin Murria). M&C Saatchi Shareholders would
therefore retain over four times the percentage ownership offered
under the NFC final offer.
-- Institutional capital. The Enlarged Group will benefit from
significantly broadening its access to additional institutional
equity, which has the ability to accelerate a re-rating of the
Enlarged Group for the existing shareholders, reflecting an
improved market position, enhanced growth prospects, and increased
liquidity of the shares. An increased rating will enable an
acceleration of future investment and accretive M&A to further
enhance the appeal of the M&C Saatchi foundation and attract
many more quality assets.
-- Greater potential. The ADV board believes that its proposals
have greater potential than both NFC and the status quo to deliver
faster growth and significant value creation for M&C Saatchi
Shareholders and employees.
-- Regulatory. ADV reiterates that it has taken appropriate
expert advice and has received all mandatory regulatory clearances
to proceed with its Final Offer.
M&C Saatchi Executive Committee
ADV had a series of positive meetings during July with the
members of the M&C Saatchi Executive Committee. Consequently,
ADV believes that the M&C Saatchi Executive Committee is
committed to M&C Saatchi's future and looks forward to working
with them.
Following these meetings, ADV re-iterates that it attaches great
importance to the skill, experience and retention of the wider
M&C Saatchi management and employees. The ADV Directors
continue to believe that the Enlarged Group will provide greater
opportunities to M&C Saatchi management, employees and all
stakeholders and an opportunity to recognise and embrace a
high-performing culture.
As set out in the Final Offer Document, the ADV LTIP prioritises
and aligns the reward of senior management with the creation of
shareholder value and return for the Enlarged Group. Upon the Offer
becoming unconditional, ADV will extend the ADV LTIP to senior
management across the Enlarged Group in order align shareholder and
participants' objectives.
NFC's final offer
Since the release of NFC's firm offer announcement on 20 May
2022, the price of a NFC Share has fallen by 36.3 per cent, from
1,266 pence to 806 pence at the close of business on 7 September
2022.
As at 7 September 2022, NFC's final offer value had therefore
declined to 171.9 pence per M&C Saatchi Share.
On the basis of ADV's share price at the close of business on 7
September 2022, ADV's final All Share Offer was equivalent to 187.2
pence per M&C Saatchi Share and the final Cash and Share Offer
was equivalent to 191.2 pence per M&C Saatchi Share.
Using ADV's NAVPS value of 91.2p per share as at 31 August 2022,
ADV's final All Share Offer is equivalent to 230.7 pence per
M&C Saatchi Share and the final Cash and Share Offer is
equivalent to 226.3 pence per M&C Saatchi Share.
ADV and Vin Murria do not support the status quo at M&C
Saatchi continuing
-- ADV and Vin Murria are significant investors in M&C
Saatchi, owning an aggregate 22.3 per cent. Neither party believes
that the current M&C Saatchi board has the attributes or
resources to deliver the value creation available to M&C
Saatchi.
-- They will not support the status quo at M&C Saatchi continuing.
-- Should ADV's Final Offer not complete, ADV and Vin Murria
will actively seek to engage with the M&C Saatchi board to
implement changes to deliver the company's potential.
-- The board of M&C Saatchi has:
-- failed to address that the group has over recent years fallen
behind its competition in terms of digital capabilities and growth,
in turn putting its creative base at higher risk from
competition
-- failed to simplify the business and its operations at pace
-- not addressed the significant put options liabilities that
have led to significant dilution since 2018 and significant
outflows of cash in the form of dividends. The cash available for
investment in M&A and growth opportunities has thus been
restricted
-- not generated share price growth. M&C Saatchi has
de-rated over recent years despite announcing strategy updates,
upgrading results, and publishing 2022 and 2023 profit before tax
forecasts
-- M&C Saatchi's share price is currently 154.4 pence and
has averaged 172.1 pence this year to 7 September
-- demonstrated inconsistent and incautious leadership,
describing ADV's proposals as "derisory" yet for a time continued
to recommend NFC's offer at a lower value only to then withdraw its
recommendation for NFC's offer soon thereafter
-- demonstrated poor cost and cash management with possible
transaction costs of GBP9.5m, as M&C Saatchi disclosed in its
2022 interim results announcement
-- allowed potential conflict of interest with Numis acting both
for M&C Saatchi and a competing offeror NFC
Acceptance Levels
As at the date of this announcement, ADV holds 12,000,000
M&C Saatchi Shares and Vin Murria holds 15,237,985 M&C
Saatchi Shares, together representing approximately 22.28 per cent.
of M&C Saatchi's issued ordinary share capital.
In accordance with Rule 17 of the Code, ADV announces that as at
1.00 p.m. (London time) on 7 September 2022 (being the last
Business Day prior to the date of this announcement), ADV had
received valid acceptances of the Final Offer in respect of
15,615,441 M&C Saatchi Shares, representing approximately 12.77
per cent. of the issued ordinary share capital of M&C Saatchi,
which ADV may count towards the satisfaction of the Acceptance
Condition together with the M&C Saatchi Shares it already owns.
This includes Vin Murria's acceptance of the Final Offer, pursuant
to the terms of her irrevocable undertaking. So far as ADV is
aware, except for Vin Murria, none of these acceptances have been
received from persons acting in concert with ADV.
Therefore, taken together with M&C Saatchi Shares that it
already holds, ADV has acquired or agreed to acquire pursuant to
the Final Offer or otherwise 27,615,441 M&C Saatchi Shares
representing approximately 22.59 per cent. of all M&C Saatchi
Shares.
Save as disclosed in this announcement, as at the close of
business on 7 September 2022 (being the last Business Day prior to
the date of this announcement), neither ADV nor any ADV Director
nor so far as the ADV Directors are aware any other person acting,
or deemed to be acting, in concert with ADV:
(a) had an interest in, or right to subscribe for, relevant securities in M&C Saatchi;
(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 M&C Saatchi;
(c) had procured an irrevocable commitment or letter of intent
to accept the terms of the Final Offer in respect of relevant
securities of M&C Saatchi; or
(d) had borrowed or lent any M&C Saatchi Shares.
Furthermore, neither ADV nor any ADV Director nor, so far as the
ADV Directors are aware, any other person acting, or deemed to be
acting, in concert with ADV is party to any arrangement in relation
to relevant securities of M&C Saatchi . For these purposes, an
"arrangement" includes any indemnity or option arrangement, any
agreement or any understanding, formal or informal, of whatever
nature, relating to M&C Saatchi Shares which may be an
inducement to deal or refrain from dealing in such securities.
Proposed cancellation of the standard listing of the ADV Shares
on the Official List and proposed admission of ADV Shares to
trading on AIM should ADV's Final Offer succeed
As set out in the Prospectus and Final Offer Document,
conditional upon the Final Offer becoming unconditional,
applications will be made to (i) the FCA to cancel the standard
listing of ADV Shares on the Official List; (ii) the London Stock
Exchange to cancel the admission to trading of the ADV Shares on
the Main Market; and (iii) the London Stock Exchange for the
existing ADV Shares, together with the New ADV Shares, to be
admitted to trading on AIM.
Pursuant to Listing Rule 5.2.8, the date of the above delisting
and Admission will be no fewer than 20 Business Days following the
date of this announcement, and within the timetable required by the
Code. The precise date of delisting and Admission will be announced
in due course.
General
Defined terms used but not defined in this announcement have the
meanings given to them in the Final Offer Document.
This announcement has been released without the prior approval
of M&C Saatchi and without the prior approval of NFC.
The person responsible for this announcement is Antoinette
Vanderpuije, Company Secretary.
Enquiries:
AdvancedAdvT Limited +44 ( 0) 20 7004 2700
Antoinette Vanderpuije
Investec Bank plc +44 (0)20 7597 5970
Christopher Baird, Alex Wright, Carlton Nelson, Nick
Prowting
Meare Consulting +44 (0)7990 858548
Adrian Duffield
Acceleration Statement - further details
The terms of the Final Offer Document originally provided that
the Unconditional Date of the Final Offer, being the date by which
all Conditions of the Final Offer must be satisfied or, to the
extent permitted, waived, failing which the Final Offer would lapse
in accordance with its terms, was 13 August 2022 (which was also
"Day 60" of the Final Offer). However, because the Final Offer
became in competition with NFC's scheme of arrangement (the "NFC
Scheme"), the Panel issued a ruling on 25 July 2022 to establish a
framework to resolve the competing offers for M&C Saatchi (the
"Panel Ruling").
The Panel Ruling stated that the timetable for the Final Offer
was to be set by reference to the timetable for the NFC Scheme. As
the M&C Saatchi Shareholder meetings in relation to the NFC
Scheme were adjourned on 19 August 2022, Day 60 (ie the latest date
by which all of the conditions to ADV's Final Offer must be
satisfied or waived) has been re-set to the fourth business day
before the Court hearing to sanction the NFC Scheme. As these
shareholder meetings have not yet been reconvened, and there is no
date for the Court sanction hearing, there is presently no calendar
date determined for Day 60.
ADV's Final Offer Document reserved the right to bring forward
the Unconditional Date in accordance with the provisions of the
Code, and ADV has exercised this right in this announcement by
making the Acceleration Statement that the new Unconditional Date
of the Final Offer is 30 September 2022.
In accordance with Rule 31.5(b) of the Code, ADV announces that
Condition (C) of the Final Offer (being a condition relating to
official authorisations or regulatory clearances) has now either
been satisfied or (where capable of waiver) waived and that
Conditions (D) to (I) of the Final Offer have now either been
satisfied or waived to the extent such Conditions relate to
official authorisations or regulatory clearances. Save to the
extent satisfied or waived, the Conditions of the Final Offer
remain outstanding (including the Acceptance Condition and the
Admission Condition).
In accordance with Rule 31.5(e) of the Code, ADV reserves the
right to set this Acceleration Statement aside in the following
circumstances:
(a) in the event of the Final Offer being recommended by the board of M&C Saatchi;
(b) if a third party (excluding, for the avoidance of doubt, NFC
in respect of its current final scheme/any future final offer)
announces a possible offer for M&C Saatchi or there is
otherwise an announcement of a possible offer for M&C Saatchi
by a third party or an announcement which refers to the existence
of a new potential offeror for M&C Saatchi (whether the
potential offeror is identified or not);
(c) if a third party (excluding, for the avoidance of doubt, NFC
in respect of its current final scheme/any future final offer)
announces a firm intention to make an offer for M&C Saatchi;
and
(d) in wholly exceptional circumstances as provided for by Rule 31.5(e)(ii) of the Code.
Under Rule 31.5(c) of the Code, as a result of the Acceleration
Statement being made (and unless the Panel consents otherwise),
Rule 31.8 of the Code is disapplied and there will therefore be no
restriction on the date by which the board of M&C Saatchi may
announce any material new information.
Further Information
Unless specified to the contrary, terms defined in the Final
Offer Document have the same meaning in this announcement.
This announcement is for information purposes only and is not
intended to and does not constitute, or form part of, an offer,
invitation or the solicitation of an offer or invitation to
purchase, or otherwise acquire, subscribe for, sell or otherwise
dispose of any securities, or the solicitation of any vote or
approval in any jurisdiction pursuant to the Final Offer or
otherwise, nor shall there be any sale, issuance or transfer of
securities of M&C Saatchi pursuant to the Final Offer or
otherwise in any jurisdiction in contravention of applicable laws.
The Final Offer will be made solely by means of the Final Offer
Document and (in respect of M&C Saatchi Shares held in
certificated form) the acceptance forms accompanying the Final
Offer Document, which will, together, contain the full terms and
conditions of the Final Offer including details of how it may be
accepted. Any decision in respect of, or other response to, the
Final Offer should be made only on the basis of the information
contained in the Final Offer Document and (in respect of M&C
Saatchi Shares held in certificated form) the acceptance forms
accompanying the Final Offer Document.
M&C Saatchi Shareholders are advised to read the Final Offer
Document and (in respect of M&C Saatchi Shares held in
certificated form) the acceptance forms accompanying the Final
Offer Document carefully when they become available because they
will contain important information in relation to the Final
Offer.
Investec, which is authorised by the Prudential Regulation
Authority (the "PRA") and regulated by the Financial Conduct
Authority and PRA in the United Kingdom, is acting exclusively as
financial adviser to ADV and for no one else in connection with the
Final Offer and will not be responsible to any person other than
ADV for providing the protections afforded to clients of Investec,
nor for providing advice in relation to the Final Offer, the
content of this announcement or any matter referred to in this
announcement. Neither Investec nor any of its subsidiaries,
branches or 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 Investec in connection with this announcement, any
statement contained herein or otherwise.
Overseas Jurisdictions
The release, publication or distribution of this announcement in
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. 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 the
United Kingdom.
Copies of this announcement and any formal documentation
relating to the Final Offer are not being, and must not be,
directly or indirectly, mailed or otherwise forwarded, distributed
or sent in or into or from any Restricted Jurisdiction and persons
receiving such documents (including custodians, nominees and
trustees) must not mail or otherwise forward, distribute or send it
in or into or from any Restricted Jurisdiction. Unless otherwise
permitted by applicable law and regulation, the Final Offer may not
be made, directly or indirectly, in or into, or by the use of mails
or any means or instrumentality (including, but not limited to,
facsimile, e-mail 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 the Final Offer may not be capable of
acceptance by any such use, means, instrumentality or
facilities.
The availability of the Final Offer to M&C Saatchi
Shareholders who are not resident in and citizens of the United
Kingdom may be affected by the laws of the relevant jurisdictions
in which they are located or of which they are citizens. Persons
who are not resident in the United Kingdom should inform themselves
of, and observe, any applicable legal or regulatory requirements of
their jurisdictions.
Further details in relation to M&C Saatchi Shareholders in
overseas jurisdictions will be contained in the Final Offer
Document, and the ADV Prospectus, as appropriate.
The Final Offer will be subject to the applicable requirements
of the Code, the AIM Rules, the London Stock Exchange and the
FCA.
Notices to US Shareholders
The Final Offer relates to securities in a non-US company
registered in England and Wales quoted on AIM, and is subject to
the disclosure requirements, rules and practices applicable to
companies listed in the United Kingdom, which differ from those of
the United States in certain material respects. This announcement
has been prepared in accordance with UK style and practice for the
purpose of complying with the laws of England and Wales and the
rules of AIM. US shareholders should read this entire document.
Accordingly, the Final Offer will be subject to disclosure and
other procedural requirements that are different from those
applicable under US domestic tender offer procedures. US
shareholders should note that M&C Saatchi is not listed on an
American securities exchange, it is not subject to the periodic
reporting requirements of the US Securities Exchange Act of 1934,
as amended, and is not required to, and does not, file any reports
with the SEC thereunder. The financial statements of M&C
Saatchi have been prepared in accordance with IFRS, which may not
be comparable to financial statements of US companies.
It may be difficult for US shareholders to enforce certain
rights and claims arising in connection with the Final Offer under
US federal securities laws since ADV and M&C Saatchi are
located outside the United States, and their officers and most of
their directors reside outside the United States. It may not be
possible to sue a non-US company or its officers or directors in a
non-US court for violations of US securities laws. It also may not
be possible to compel a non-US company or its affiliates to subject
themselves to a US court's judgment.
To the extent permitted by applicable law and in accordance with
the Takeover Code and normal U.K. practice, ADV or its affiliates
or agents may make purchases of, or make arrangements to purchase,
shares of M&C Saatchi outside the United States otherwise than
under the Final Offer.
The Final Offer will be subject to the applicable requirements
of the Code, the AIM Rules, the London Stock Exchange and the
FCA.
Publication on website
In accordance with Rule 26 of the Takeover Code, a copy of this
announcement will be made available, subject to certain
restrictions relating to persons resident in Restricted
Jurisdictions, on ADV's website at www.AdvancedAdvT.com by no later
than noon (London time) on the day following this announcement. The
content of this website is not incorporated into and does not form
part of this announcement.
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END
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