NOT
FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, INTO OR FROM ANY
JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OF SUCH JURISDICTION.
THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY
CODE ON TAKEOVERS AND MERGERS (THE "CODE"). IT DOES NOT REPRESENT A
FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE.
ACCORDINGLY, THERE CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE
MADE.
THIS ANNOUNCEMENT CONTAINS INSIDE
INFORMATION.
FOR
IMMEDIATE RELEASE
23
May 2024
NewRiver REIT
plc
("NewRiver" or the "Company")
Possible Offer for Capital
& Regional plc ("Capital & Regional")
The Board of NewRiver notes the
recent announcement by Capital & Regional and confirms that it
has made a proposal to Growthpoint Properties Limited
("Growthpoint") which holds 68.1% of the issued share capital of
Capital & Regional in regard to a possible offer in cash and
shares for the entire issued, and to be issued, share capital of
Capital & Regional (the "Possible Offer"). NewRiver also
confirms that it has not communicated that proposal to Capital
& Regional. It is intended that this would occur if Growthpoint
confirms that it would be prepared to support the terms of that
Possible Offer. The Board of NewRiver of course recognises that the
Board of Capital & Regional must make its own fair and
reasonable assessment of the Possible Offer in the event that
NewRiver makes the proposal to Capital & Regional.
The Board of NewRiver believes that
a combination with Capital & Regional, on the terms of the
Possible Offer proposed to Growthpoint, would be significantly
accretive to NewRiver's earnings and result in a pro-forma Loan to
Value ("LTV") ratio that is broadly in-line with NewRiver's
guidance.
There can be no certainty that any
offer will be made, nor as to the terms of any such
offer.
The Board of NewRiver has given
significant consideration to the ways in which a combination of
NewRiver and Capital & Regional could generate value for our
respective shareholders. NewRiver's Board believes that, provided
sensible terms for a transaction can be agreed, the acquisition of
Capital & Regional would significantly accelerate NewRiver's
growth ambitions, whilst delivering significant value for both
Capital & Regional and NewRiver shareholders and also
maintaining NewRiver's core operational expertise in retail real
estate.
The Board of NewRiver believes that
a combination of Capital & Regional and NewRiver (the "Combined
Group") represents a highly attractive proposition for all
shareholders on account of:
· Capital & Regional's high
quality and complementary portfolio:
Capital & Regional's portfolio comprises six community shopping
centres predominantly located in London and South East England, let
to essential and value-oriented retailers that would be highly
complementary to NewRiver's existing portfolio. NewRiver knows
these assets well and believes that the disposal of non-core assets
in recent years and the acquisition of The Gyle in Edinburgh in
September 2023 have led to an improvement in the quality and
complementary nature of Capital & Regional's remaining
portfolio. Against this real estate background, the Board believes
that the financially accretive aspects of the combined business
strategy can be readily achieved;
· Combination expected to
unlock substantial cost synergies and deliver significant earnings
accretion: NewRiver sees, inter
alia, the opportunity to unlock substantial cost synergies,
including the elimination of duplicative operational and public
listing costs. NewRiver also anticipates income growth
opportunities through active asset management. NewRiver expects the
combination with Capital & Regional to deliver significant
earnings accretion, enabling the Combined Group to pay a materially
higher, covered dividend;
· Well-diversified portfolio
with enhanced scale: the Combined
Group would have a retail focused portfolio with a comparable yield
profile, valued at c.£920 million (comprising 42 assets), and
assets under management of c.£1.7 billion (comprising 63 assets)
based upon the last reported figures for both companies. The
combined portfolio would continue to benefit from a
well-diversified and complementary tenant base with low levels of
tenant concentration; and
· Increased trading
liquidity: As a result of its
enhanced scale, it is expected the Combined Group would benefit
from increased share trading liquidity, enlarged index weightings,
enhanced debt optionality and potential cost of capital
improvements.
Any firm intention to make an offer
under Rule 2.7 of The City Code on Takeovers and Mergers (the
"Code"), would be contingent on securing the support of Growthpoint
and the satisfaction or waiver of certain customary conditions,
including completion of due diligence to the satisfaction of
NewRiver. The Board of NewRiver further confirms that in
formulating a Possible Offer, it would act with the necessary
prudence to maintain NewRiver's balance sheet strength. As stated
above, the Board of NewRiver anticipates that NewRiver's pro-forma
LTV implied by a Possible Offer would remain broadly in-line with
previous guidance.
As required by Rule 2.6(a) of the
Code, NewRiver is required, by not later than 5.00 p.m. on 20 June
2024, either to announce a firm intention to make an offer for the
Company in accordance with Rule 2.7 of the Code or to announce that
it does not intend to make an offer, in which case the announcement
will be treated as a statement to which Rule 2.8 of the Code
applies. This deadline may be extended with the consent of the
Panel on Takeovers and Mergers ("Takeover Panel") in accordance
with Rule 2.6(c) of the Code. For the
purposes of Rule 2.5(a) of the Code, NewRiver reserves the right to
vary the form and mix of the consideration and/or to introduce
other forms of consideration.
A further announcement will be made
if and when appropriate. There can be no certainty any offer will
be made, even if the pre-conditions are satisfied or waived, nor as
to the terms of any offer.
This announcement is being made
without the consent of Capital & Regional or
Growthpoint.
For
further information
NewRiver REIT plc
|
+44 (0)20 3328
5800
|
Allan Lockhart (Chief
Executive)
|
|
Will Hobman (Chief Financial
Officer)
|
|
|
|
Jefferies International Limited (Lead Financial Adviser and
Joint
Corporate Broker)
|
+44 (0)20 7029
8600
|
Philip Noblet
|
|
Rishi Bhuchar
|
|
Ed Matthews
|
|
|
+44 (0)20 3100
2000
|
Liberum Capital Limited (Joint Corporate
Broker)
|
|
Jamie Richards
|
|
Nikhil Varghese
|
|
|
|
Shore Capital Stockbrokers Limited (Joint Corporate
Broker)
|
+44 (0)20 7408
4090
|
Mark Percy
|
|
Malachy McEntyre
Ben Canning
|
|
|
|
FTI
Consulting
|
+44 (0)20 3727
1000
|
Dido Laurimore
Giles Barrie
|
|
|
|
The information contained within
this announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulation (EU)
No. 596/2014 as it forms part of the law of England and Wales by
virtue of the European Union (Withdrawal) Act 2018. This
announcement has been authorised for release by the Board of
Directors of NewRiver.
Important Notices
This announcement does not
constitute a prospectus or prospectus equivalent document. This
announcement is not intended to, and does not, constitute or form
part of any offer, invitation or the solicitation of an offer to
purchase, otherwise acquire, subscribe for, sell or otherwise
dispose of any securities, or the solicitation of any vote or
approval in any jurisdiction, pursuant to this announcement or
otherwise. Any offer, if made, will be made solely by certain offer
documentation which will contain the full terms and conditions of
any offer, including details of how it may be accepted or a vote
submitted in favour of it.
The release, publication or
distribution of this announcement in jurisdictions other than the
United Kingdom may be affected by the laws of relevant
jurisdictions. Therefore, any person who is subject to the laws of
any jurisdiction other than the United Kingdom will need to inform
themselves about, and observe, any applicable requirements. Any
failure to comply with such requirements may constitute a violation
of the securities laws or regulations of the relevant
jurisdictions.
Notices Related to Financial Advisers
Jefferies International Limited
("Jefferies"), which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting exclusively
for NewRiver and no one else in connection with the Possible Offer
and shall not be responsible to anyone other than NewRiver for
providing the protections afforded to clients of Jefferies, nor for
providing advice in connection with the Possible Offer or any
matter referred to herein. Neither Jefferies nor any of its
affiliates (nor any of its or their respective directors, officers,
employees, representatives or agents) owes or accepts any duty,
liability or responsibility whatsoever (whether direct, indirect,
consequential, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Jefferies in
connection with the Possible Offer, this announcement, any
statement contained herein or otherwise.
Kinmont Limited ("Kinmont"), which
is authorised and regulated in the United Kingdom by the Financial
Conduct Authority, is acting exclusively for NewRiver and no one
else in connection with the Possible Offer and shall not be
responsible to anyone other than NewRiver for providing the
protections afforded to clients of Kinmont, nor for providing
advice in connection with the Possible Offer or any matter referred
to herein. Neither Kinmont nor any of its affiliates (nor any of
its or their respective directors, officers, employees,
representatives or agents) owes or accepts any duty, liability or
responsibility whatsoever (whether direct, indirect, consequential,
whether in contract, in tort, under statute or otherwise) to any
person who is not a client of Kinmont in connection with the
Possible Offer, this announcement, any statement contained herein
or otherwise.
Liberum Capital Limited ("Liberum"),
which is authorised and regulated in the United Kingdom by the FCA,
is acting exclusively for NewRiver and no one else in connection
with the matters described in this announcement. Liberum will not
regard any other person (whether or not a recipient of this
announcement) as its client in relation to the matters described in
this announcement and will not be responsible to anyone other than
NewRiver for providing the protections afforded to its clients or
for providing any advice in relation to matters or arrangements
referred to herein. Neither Liberum nor any of its affiliates (nor
any of its or their respective directors, officers, employees,
representatives or agents) owes or accepts any duty, liability or
responsibility whatsoever (whether direct, indirect, consequential,
whether in contract, in tort, under statute or otherwise) to any
person who is not a client of Liberum in connection with the
Possible Offer, this announcement, any statement contained herein
or otherwise.
Shore Capital Stockbrokers Limited
("Shore Capital"), which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting exclusively
for NewRiver and no one else in connection with the Possible Offer
and shall not be responsible to anyone other than NewRiver for
providing the protections afforded to clients of Shore Capital, nor
for providing advice in connection with the Possible Offer or any
matter referred to herein. Neither Shore Capital nor any of its
affiliates (nor any of its or their respective directors, officers,
employees, representatives or agents) owes or accepts any duty,
liability or responsibility whatsoever (whether direct, indirect,
consequential, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Shore Capital in
connection with the Possible Offer, this announcement, any
statement contained herein or otherwise.
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.
Rule 26.1 Disclosure
In accordance with Rule 26.1 of the
Code, a copy of this announcement will be available at
www.nrr.co.uk by no later than 12 noon (London time) on
24 May 2024.
For the avoidance of doubt, the
content of the website referred to in this announcement is not
incorporated into and does not form part of this
announcement.
No
profit forecasts, profit estimates or quantified financial benefits
statements
Nothing in this announcement
(including any statement of estimated synergies) is intended as a
profit forecast, profit estimate or quantified financial benefit
statement for any period and no statement in this announcement
should be interpreted to mean that earnings or earnings per share
or dividend per share for NewRiver or Capital & Regional, as
appropriate, for the current or future financial years would
necessarily match or exceed the historical published earnings or
earnings per share or dividend per share for NewRiver or Capital
& Regional, as appropriate.
Forward-looking statements
This announcement and certain oral
statements made regarding the Possible Offer and other information
published by NewRiver containing statements about NewRiver, Capital
& Regional and/or the Combined Group are or may be deemed to be
forward-looking statements. All statements other than statements of
historical facts included in this announcement, may be
forward-looking statements. Without limitation, any statements
preceded or followed by or that include the words "targets",
"plans", "believes", "expects", "aims", "intends", "hopes",
"continues", "would", "could", "should", "will", "may",
"anticipates", "estimates", "projects" or words or terms of similar
substance or the negative thereof, are forward-looking statements.
Forward-looking statements 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; and (ii)
business and management strategies and the expansion and growth of
NewRiver, Capital & Regional or the Combined Group's operations
and potential cost and operating synergies resulting from the
Possible Offer. These forward-looking statements are not based on
historical fact and are not guarantees of future performance. By
their nature, such forward-looking statements involve known and
unknown risks and uncertainties that could significantly affect
expected results and are based on certain key assumptions. Many
factors could cause actual results to differ materially from those
projected or implied in any forward-looking statements. Many of
these risks and uncertainties relate to factors that are beyond the
entities' ability to control or estimate precisely. These factors
include, but are not limited to, changes in political and economic
conditions, changes in levels of capital investment, success of
business and operating initiatives, the impact of any acquisitions
or similar transactions, changes in tenants' strategies and
stability, changes in the regulatory environment and fluctuations
of rates, and changes in tax rates. They have not been reviewed by
the auditors of NewRiver or Capital & Regional. Neither
NewRiver, nor any of its affiliates or 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. Neither NewRiver, nor any of its affiliates or directors,
officers, employees or advisers assumes any obligation to update or
correct the information contained in this announcement except as
required by applicable law. Due to such uncertainties and risks,
readers are cautioned not to place undue reliance on such
forward-looking statements, which speak only as of the date of this
announcement. NewRiver disclaims any obligation to correct or
update any forward-looking or other statements contained in this
announcement, except as required by applicable law or by the rules
of any competent regulatory authority, whether as a result of new
information, future events or otherwise.
Rule 2.4 Information
In accordance with Rule 2.4(c)(iii)
of the Code, NewRiver confirms that it is not aware of any dealings
in Capital & Regional shares that would require it to offer a
minimum level, or a particular form, of consideration under Rule 6
or Rule 11 of the Code. However, it has not been practicable for
NewRiver to make enquiries of all persons acting in concert with it
prior to the date of this announcement in order to confirm whether
any details are required to be disclosed under Rule 2.4(c)(iii) of
the Code. To the extent that any such details are identified
following such enquiries, NewRiver will make an announcement
disclosing such details as soon as practicable, and in any event by
no later than the time it is required to make its Opening Position
Disclosure under Rule 8.1 of the Code."
Rule 2.9 Disclosure
In accordance with Rule 2.9 of the
Code, as at the close of business on 22 May 2024 (being the
business day prior to the date of this announcement), NewRiver
confirms that its issued share capital consisted of 313,686,292
ordinary shares of one penny each with voting rights, of which
3,317,219 ordinary shares are held in the Employee Benefit Trust
(EBT). Accordingly, the total number of voting rights in the
Company is 310,369,074. The Company does not hold any shares in
treasury. The International Securities Identification Number (ISIN)
of the ordinary shares is GB00BD7XPJ64.
About NewRiver
NewRiver REIT plc ("NewRiver") is a
leading Real Estate Investment Trust specialising in buying,
managing and developing resilient retail assets throughout the
UK.
Our £0.54 billion UK wide portfolio
covers 6.1 million sq ft and comprises 24 community shopping
centres and 12 conveniently located retail parks occupied by
tenants predominately focused on essential goods and services. In
addition, we manage 18 retail parks and 5 shopping centres on
behalf of Capital Partners, taking our total Assets Under
Management to £1.3 billion. Our objective is to own and manage the
most resilient retail portfolio in the UK, focused on retail parks,
core shopping centres, and regeneration opportunities in order to
deliver long term attractive recurring income returns and capital
growth for our shareholders.
NewRiver has a Premium Listing on
the Main Market of the London Stock Exchange (ticker: NRR). Visit
www.nrr.co.uk for further information.
LEI Number:
2138004GX1VAUMH66L31