FOR
IMMEDIATE RELEASE
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 OR REGULATIONS OF SUCH
JURISDICTION
THIS
ANNOUNCEMENT DOES NOT CONSTITUTE AN ANNOUNCEMENT OF A FIRM
INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE. THERE CAN BE
NO CERTAINTY THAT ANY OFFER WILL BE MADE, NOR AS TO THE TERMS ON
WHICH ANY OFFER MAY BE MADE
THIS
ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
13
May 2024
The MISSION Group
plc
("MISSION", the "Company" or
the "Group")
RESPONSE TO RECENT PRESS
SPECULATION AND POSSIBLE OFFER ANNOUNCEMENT BY BRAVE BISON GROUP
PLC
MISSION Group
plc (AIM: TMG), notes the recent press
speculation and the announcement released on 12 May 2024 by Brave
Bison Group plc ("Brave
Bison") in accordance with Rule 2.4 of the City Code on
Takeovers and Mergers (the "Code") and confirms that on 29 April
2024, it received an unsolicited conditional proposal regarding a
possible offer by Brave Bison for the entire issued and to be
issued share capital of MISSION. Such offer comprised an
all-share offer at an exchange ratio of 11.5 Brave Bison shares for
each ordinary share in MISSION (the "Possible Offer"). Based on the terms of
the Possible Offer and the closing market prices of MISSION and Brave Bison shares on 29
April 2024, being the last trading day prior to receipt of the
Possible Offer, the Possible Offer valued each MISSION share at approximately 29
pence1.
On 8 May 2024, the Board of
MISSION,
following consultation with its financial and
legal advisers, unanimously rejected the Possible Offer which it
believes to be opportunistic and significantly undervalues the
Group and its prospects. Moreover, it is dilutive to MISSION's shareholders as it does not
reflect the relevant contributions of each party to the proposed
combined group. In that regard, the Board
of MISSION would like to
bring shareholders' attention to the following points:
· The terms of
the Possible Offer represent a see-through value of approximately
29.04 pence per MISSION
share1. Were the Possible Offer to be implemented on its
indicative terms, this would result in MISSION's shareholders holding
approximately 45 per cent.
of the proposed combined group.
· The Board believes
that the Possible Offer and resultant approximate 45 per cent.
holding of MISSION's
shareholders in the proposed combined group does not fully reflect
the inherent value in MISSION which, post the impact of the
23 October 2023 trading update has been steadily improving
reflected in a 62.1 per cent. increase in the MISSION share price since 23 October
20233.
· Moreover, the Board believes that the Possible Offer
significantly undervalues the contribution of MISSION to the proposed combined group.
Based on the respective net revenue, adjusted EBITDA and adjusted
pre-tax profit contributions of MISSION and Brave Bison as set out in
their respective results for their financial years ending 31
December 2023, MISSION
would contribute approximately 81 per cent. of revenues,
approximately 71 per cent. of adjusted EBITDA and approximately 54
per cent. of adjusted pre-tax profits to the proposed combined
group2. The proposed holding of approximately 45 per
cent. of MISSION's
shareholders in the proposed combined group does not reflect that
contribution.
· MISSION's
shareholders holding of approximately 45 per cent.
of the proposed combined group is also before the impact of an
additional equity fundraising of at least £10 million which Brave
Bison has indicated to MISSION they are considering in order
to accelerate debt repayment and strengthen the balance sheet of
the proposed combined group. While the Board of MISSION understands such fundraising is
not a condition to the Possible Offer, any such equity fundraising
could further dilute MISSION's shareholders' interest in the
proposed combined group.
· The terms of the Possible Offer do not reflect, in terms of
Brave Bison's proposed Board composition, the significant
contribution of MISSION to
the proposed combined group as they currently envisage only one
additional Non-Executive Director from MISSION will join the board of the
proposed combined group.
· The Board of
MISSION do not believe the
Possible Offer is transformational for MISSION and its offering to its
clients. The proposed combined group would have increased scale and
some additional capabilities, but these do not offset the dilutive
impact to MISSION's
shareholders of only holding approximately 45 per cent. of the
proposed combined group.
· The Possible Offer
is earnings dilutive for MISSION's shareholders. Brave Bison
anticipate that MISSION's
shareholders would enjoy more value from the combination based on a
re-rating of the proposed combined group. There is no
certainty of a re-rating.
· As
previously announced on 17 January 2024, the Board of MISSION has set out how it expects to
realise value for MISSION's
shareholders through its standalone strategy and execution of the
Group's Value Restoration Plan, which is now well underway.
· The Board
continues to work closely with NatWest, the Company's lender, and
was pleased to announce a refinancing arrangement on 28 March 2024,
which extended facilities through to 5 April 2026. This provides
the flexibility the Company needs to deliver on its Value
Restoration Plan and reduce its leverage.
· The
announcement by Brave Bison on 12 May 2024 in relation to the
Possible Offer stated that MISSION's outstanding debts and certain
liabilities totalled approximately £30 million as at 31 December
2023, comprising bank loans of £20.0 million, acquisition
obligations of £5.5 million and HMRC Time to Pay agreement of £4.3
million. The Board of MISSION wishes to draw MISSION's shareholders attention to the
fact that the above numbers exclude MISSION's cash balances and therefore
the outstanding debts (net of cash balances) and certain
liabilities totalled approximately £25.2 million as at 31 December
20234 and that its outstanding debts (net of cash
balances) and certain liabilities totalled approximately £26.8
million as at 30 April 20245.
MISSION also notes that
certain of its acquisition obligations can
be settled in MISSION
shares.
· In addition, the
Board of MISSION continues
to review the Group's options to reduce its debt position and is
considering the disposal of certain assets within its portfolio to
reduce its leverage further. The Board of MISSION remains confident that during
the remainder of the year, it will deliver on its plan to reduce
leverage.
The Board of MISSION is open to proposals that it
believes would enhance shareholder value and deliver benefits to
MISSION's shareholders. The
Board of MISSION does not
consider the terms of the Possible Offer to meet those criteria.
Shareholders are urged to take no action at this
time.
This announcement has been made by
MISSION without the
agreement or approval of Brave Bison.
There can be no certainty either
that an offer will be made nor as to the terms on which any offer
might be made.
In accordance with Rule 2.6(a) of
the Code, Brave Bison must, by no later than 5.00 p.m. (London
time) on 9 June 2024, either announce a firm intention to make an
offer for MISSION in accordance with Rule 2.7 of the Code, or
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. The deadline can be extended with the consent
of the Takeover Panel in accordance with Rule 2.6(c) of the
Code.
The attention of shareholders is
drawn to the disclosure requirements of Rule 8 of the Code, which
are summarised below.
Footnotes:
1
The valuation of approximately 29.04 pence per
MISSON share and the
approximate 45 per cent. ownership for MISSION's shareholders in
the proposed combined group, is based on (i) an exchange ratio of
11.5 Brave Bison shares for each ordinary share in MISSION, (ii) a Brave Bison closing
mid-market share price of 2.525 pence (as at 29 April 2024, being
the last trading day prior to the receipt of the Possible Offer),
(iii) an issued share capital of MISSION being 92,238,119 shares and
(iv) an issued share capital of Brave Bison being 1,288,147,280
shares.
2 The
contribution of MISSION to
the proposed combined group is based on the following
information:
Revenue
|
£
million
|
%
|
MISSION (see Note 2(a))
|
86.3
|
80.5
|
Brave Bison (see Note
2(b))
|
20.9
|
19.5
|
Pro forma
|
107.2
|
100.0
|
Adjusted EBITDA
|
|
|
MISSION (see Note 2(a))
|
10.6
|
71.3
|
Brave Bison (see Note
2(b))
|
4.3
|
28.7
|
Pro forma
|
14.9
|
100.0
|
Adjusted profit before tax
|
|
|
MISSION (see Note 2(a))
|
4.2
|
53.6
|
Brave Bison (see Note
2(b))
|
3.6
|
46.4
|
Pro forma
|
7.8
|
100.0
|
(a) for the year ended 31
December 2023, MISSION had
reported net revenue of £86.3 million from continuing operations
(turnover of £195.4 million less cost of sales of £109.1 million),
headline EBITDA of £10.6 million (headline operating profit
(continuing operations) of £6.5 million, depreciation of owned
tangible assets of £1.2 million, depreciation expense on right of
use assets of £2.6 million and amortisation of other intangible
assets of £0.4 million) and headline pre-tax profits of £4.2
million (continuing operations). This financial information
relating to the Company has been extracted or derived (without any
adjustment) from the Company's final results for the year ended 31
December 2023;
(b) for the year ended 31 December
2023, Brave Bison reported net revenue of £20.9 million
(turnover/billings of £35.7 million less cost of sales of £14.8
million), adjusted EBITDA of £4.3 million and adjusted pre-tax
profits of £3.6 million. This financial information relating to
Brave Bison has been extracted or derived (without any adjustment)
from Brave Bison's final results for the year ended 31 December
2023.;
3 The
closing mid-market price for a MISSION share on 23 October 2023 was
14.0 pence, and
on
10 May 2024 was 22.7 pence.
4 The
statements regarding MISSION's outstanding debts (net of
cash balances) and certain liabilities totalling approximately
£25.2 million as at 31 December 2023 and comprised of net debt of
£15.4 million, acquisition obligations of £5.5 million and HMRC
Time to Pay agreement of £4.3 million have been extracted or derived (without any
adjustment) from MISSION's
final results for the year ended 31 December 2023.
5 The
statements regarding MISSION's outstanding debts (net of
cash balances) and certain liabilities totalling approximately
£26.8 million as at 30 April 2024 and comprised of net bank debt of
£22.2 million, acquisition obligations of £4.1 million and HMRC
Time to Pay agreement of £0.5 million have been extracted from
MISSION's unaudited
internal financial information.
ENDS
ENQUIRIES:
David Morgan, Non-Executive
Chair
James Clifton, Chief Executive
Officer
Giles Lee, Chief Financial
Officer
The MISSION Group plc
|
Via Houston
|
|
|
Simon Bridges / Julie Langley /
Andrew Potts / Harry Rees
|
|
Canaccord Genuity Limited (Financial Adviser, Nominated Adviser and Broker)
|
020 7523 8000
|
|
|
|
|
Kate Hoare / Alexander Clelland /
India Spencer
|
|
HOUSTON (Financial PR and
Investor Relations)
|
0204 529 0549
|
Canaccord Genuity Limited, which is authorised and regulated
in the United Kingdom by the FCA, is acting as financial adviser
and corporate broker exclusively for MISSION and for no one else in
connection with the Possible Offer and will not regard any other
person as its client in relation to the matters referred to in this
announcement and will not be responsible to anyone other than
MISSION for providing the
protections afforded to clients of Canaccord Genuity Limited, nor
for providing advice in relation to the Possible Offer or any other
matter referred to in this announcement.
The person responsible for arranging
the release of this announcement on behalf of MISSION is James Clifton.
Publication of this announcement
In accordance with Rule 26.1 of the
Code, a copy of this announcement will be available on the
Company's website at https://www.themission.co.uk/
by no later than 12 noon (London time) on the
business day following the date of this announcement. The content of the website
referred to in this announcement is not incorporated into and does
not form part of this announcement.
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 (as
defined in the Code) 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
(as defined in the Code).
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 Bidder
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 Bidder 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 2.9 disclosure
In accordance with Rule 2.9 of the
Code, MISSION confirms that
as at the date of this announcement, it has 92,238,119 ordinary
shares of £0.10 each in issue and admitted to trading on AIM, the
market operated by the London Stock Exchange. MISSION holds no ordinary shares in
treasury. The total number of voting rights in MISSION is currently 92,238,119. The
International Securities Identification Number for MISSION ordinary shares is
GB00B11FD453.
The information contained within
this announcement is deemed to constitute inside information as
stipulated under the Market Abuse (Amendment) (EU Exit) Regulations
2019. Upon the publication of this announcement, this inside
information is now considered to be in the public
domain.