Half-year Report

RNS Number : 1421X

Hambro Perks Acquisition Com Ltd

25 August 2022

 

HAMBRO PERKS ACQUISITION COMPANY LIMITED

("Hambro Perks")

25 August 2022

INTERIM REPORT

Hambro Perks is pleased to announce the release of its Interim Report and Financial Statements for the period from 1 January 2022 to 30 June 2022, approved by the Board of Directors on the 24 August 2022.  The Interim Report is set out below in its full unedited form.

For further information, please contact:

Company Administrator

Ocorian Administration (Guernsey) Limited

[e-mail]

Company Secretary

Peter Soliman

[e-mail]

About Hambro Perks:

Hambro Perks is a special purpose acquisition company incorporated as a non-cellular company limited by shares under the laws of the Island of Guernsey with number 69093 and for the purpose of acquiring a majority (or otherwise controlling) stake in a company or operating business through a merger, capital stock exchange, share purchase, asset acquisition, reorganisation or similar transaction. Hambro Perks intends to focus on technology-enabled businesses with principal business operations in the United Kingdom, a member state of the European Economic Area or Switzerland.

  HAMBRO PERKS ACQUISITION COMPANY LIMITED

INTERIM REPORT

FOR THE PERIOD FROM 1 JANUARY 2022 TO 30 JUNE 2022

CONTENTS

Company Summary 

Chairman's Statement 

Statement of Directors' Responsibilities 

Financial Statements

Unaudited Condensed Statement of Comprehensive Income  

Unaudited Condensed Statement of Financial Position  

Unaudited Condensed Statement of Changes in Equity  

Unaudited Condensed Statement of Cash Flows  

Notes to the Unaudited Condensed Financial Statements  

Officers and Advisors     

COMPANY SUMMARY

Principal activity

Hambro Perks Acquisition Company Limited (the "Company") was incorporated and registered in Guernsey under The Companies (Guernsey) Law, 2008 on 14 April 2021 with a registration number 69093 as a special purpose acquisition company ("SPAC") incorporated for the purpose of acquiring a majority (or otherwise controlling) stake in a company or operating business (the "Target" or "Target Business") through a merger, capital stock exchange, share purchase, asset acquisition, reorganisation or similar transaction (a "Business Combination"). The Company intends to focus on the technology-enabled sector and businesses with principal business operations in the United Kingdom.

The Company's main objective is to complete its Business Combination within an initial period of 15 months from 25 November 2021 (the "Initial Business Combination Deadline"), subject to an initial three month extension period (the "First Extension Period") and a further three month extension period (the "Second Extension Period"), in each case if approved by a Shareholder vote (the "Business Combination Deadline"), although such extensions are not of a type required to be approved by Public Shareholders as contemplated by Listing Rule 5.6.18AG.

Business Combination

The Company anticipates structuring its Business Combination either (i) in such a way so that the post-transaction company will own or acquire 100% of the equity interests or assets of the Target, or (ii) in such a way so that the post -transaction company owns or acquires less than 100% of such interests or assets of the Target in order to meet certain objectives of the Target management team or stockholders, or for other reasons. However, the Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the Target or otherwise acquires a controlling interest in the Target.

Even if the Company owns 50% or more of the voting securities of the Target Business, Public Shareholders, prior to the Business Combination, may collectively own a minority interest in the post-Business Combination company, depending on valuations ascribed to the Target Business and the Company in the Business Combination. For example, the Company could pursue a transaction in which it issues a substantial number of new Ordinary Shares to shareholders of the Target in exchange for all of the outstanding share capital of the Target. In this case, the Company would acquire a 100% controlling interest in the Target. However, as a result of the issuance of a substantial number of new Ordinary Shares, the Public Shareholders immediately prior to such transaction could own less than a majority of the Company's Public Shares subsequent to such transaction.

The Business Combination Process

In evaluating prospective Business Combinations, the Company expects to conduct a thorough due diligence review that may encompass, among other things, a review of historical and projected financial and operating data, meetings with management and their advisors (if applicable), on-site inspections of facilities and assets to the extent possible, discussion with customers and suppliers, document reviews, as well as a review of financial, operational, legal and other information which will be made available to the Company and which the Company deem appropriate. The Company will also use the Company ' s expertise and the Company ' s Sponsor ' s expertise in analysing companies and evaluating operating projections, financial projections and determining the appropriate return expectations.

CHAIRMAN'S STATEMENT

Dear Shareholders,

It is with pleasure that I present the financial statements of Hambro Perks Acquisition Company Limited ("HPAC" or the "Company") for the six month period ended 30 June 2022.

HPAC was admitted to trading on the main market of the London Stock Exchange on 25 November 2021, having raised in the region of £150 million from an offer of new shares. The Company has since been reviewing opportunities to combine with a high-quality technology-enabled business as outlined in the prospectus.

The continuing war in Ukraine, the consequences of the COVID-19 pandemic, and now significant inflation, have combined to create market uncertainty and volatility. There are other headwinds, such as the performance of SPACs in the US. Despite these considerations, we continue to have discussions with exciting companies that meet our criteria and have the potential to be excellent listed companies. In the light of these discussions I remain cautiously optimistic that we will be able to announce a business combination within the time constraints referred to in the prospectus.

You will shortly be receiving notice formally convening the Annual General Meeting of the Company to be held on the 5^th October 2022. I look forward to seeing many of you then.

On behalf of the Board, I thank you for your valued support.

Sir Anthony Salz

Chairman

24 August 2022

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Interim Report and Financial Statements in accordance with applicable laws and regulations. The Board confirms that to the best of their knowledge:

§ The condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting';

§ The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and their impact on the condensed financial statements and description of principal risks and uncertainties for the remaining six months of the year); and

§ The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties transactions and changes therein); and

§ The condensed set of financial statements, which has been prepared in accordance with the applicable set of accounting standards, gives a true and fair view of the assets, liabilities, financial position and profit or loss of the issuer as required by DTR 4.2.10R.

The Board is responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy, at any time, the financial position of the Company, and that enable them to ensure that the financial statements comply with the Companies (Guernsey) Law, 2008 (as amended). The Board is also responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Principal Risks and Uncertainties

The principal risks and uncertainties of the Company are described in the Report of the Directors within the Annual Report and Audited Financial Statements of the Company for the period ended 31 December 2021.  The Directors will continue to assess the principal risks and uncertainties relating to the Company for the remaining six months of the current fiscal year in light of the COVID-19 pandemic, the Ukraine conflict and any other emerging risks, but currently expects them to remain substantially the same.

Signed on behalf of the Board by:

Sir Anthony Salz

Director

24 August 2022

UNAUDITED CONDENSED STATEMENT OF COMPREHENSIVE INCOME

For the period from 1 January 2022 to 30 June 2022

				For the period from		For the period from
				1 January 2022 to		14 April 2021 to
		Notes		30 June 2022		31 December 2021
				(unaudited)		(audited)
				£		£
Income
Bank interest income				421,678		7,124
Gain on derivative instruments		5		6,435,164		2,214,250
Total income				6,856,842		2,221,374
Expenses
Administration fees		10		(39,536)		(3,041)
Advisory fees		10		(60,000)		(12,000)
Audit fee		8		(37,500)		(97,850)
Company Secretarial fees				(10,000)		(2,082)
Directors' fees		10		(100,000)		(20,164)
D&O Insurance				(136,839)		(27,138)
LSE fees				(4,669)		(1,150)
Legal and professional fees				(2,377)		-
Share issue costs				-		(256,360)
Sundry expenses				(13,799)		(814)
Total operating expenses				(404,720)		(420,599)
Finance expense		4		(3,563,237)		(717,752)
Profit for the period before tax				2,888,885		1,083,023
Withholding tax				(4,293)		(2,137)
Total comprehensive income for the period				2,884,592		1,080,886
Basic earnings per Share		7		£0.72		£2.03
Diluted earnings per Share		7		£0.72		£2.03

All items in the above statement derive from continuing operations.

UNAUDITED CONDENSED STATEMENT OF FINANCIAL POSITION

As at 30 June 2022

	Notes		30 June 2022 (unaudited)	31 December 2021 (audited)
			£	£
Current assets
Restricted cash	3		150,564,220	150,146,837
Cash and cash equivalents	3		1,804,143	1,657,916
Other receivables	6		179,773	1,000,000
Total assets			152,548,136	152,804,753
Non-current liabilities:
Redeemable Public Share liabilities	4		141,702,670	138,139,433
Current liabilities:
Derivative liabilities	5		1,453,102	7,888,266
Other payables			155,872	425,154
Total liabilities			143,311,644	146,452,853
Equity
Share capital	4		3,604,764	3,604,764
Other reserves	5		1,666,250	1,666,250
Retained earnings			3,965,478	1,080,886
Total equity			9,236,492	6,351,900
Total equity and liabilities			152,548,136	152,804,753

The Condensed Interim Financial Statements were approved and authorised for issue by the Board of Directors on 24 August 2022 and signed on its behalf by:

Sir Anthony Salz

Director

The accompanying notes below form an integral part of these Financial Statements.

UNAUDITED CONDENSED STATEMENT OF CHANGES IN EQUITY

For the period from 1 January 2022 to 30 June 2022

	Notes	Share  capital	Other reserves	Retained earnings	Total
		£	£	£	£
As at 1 January 2022		3,604,764	1,666,250	1,080,886	6,351,900
Total comprehensive profit for the period		-	-	2,884,592	2,884,592
As at 30 June 2022		3,604,764	1,666,250	3,965,478	9,236,492

For the period from 14 April 2021 to 31 December 2021

	Notes	Share   capital	Other reserves	Retained earnings	Total
		£	£	£	£
As at 14 April 2021		-	-	-	-
Issue of share capital and sponsor warrants	4,5	3,604,764	1,666,250	-	5,271,014
Total comprehensive profit for the period		-	-	1,080,886	1,080,886
As at 31 December 2021		3,604,764	1,666,250	1,080,886	6,351,900

Sponsor warrants have been accounted for as a capital contribution in other reserves. Please see notes 2 and 5 for further details.

The accompanying notes below form an integral part of these Financial Statements.

UNAUDITED CONDENSED STATEMENT OF CASH FLOWS

For the period from 1 January 2022 to 30 June 2022

						For the period				For the period from
						1 January 2022 to				14 April 2021 to
			Notes			30 June 2022		31 December 2021
						(unaudited)		(audited)
						£		£
Cash flows from operating activities
Profit for the period							2,884,592		1,080,886
Adjustments for:
Gain on derivative				5			(6,435,164)		(2,214,250)
Finance expense				4			3,563,237		717,752
Increase in other receivables							(179,773)		-
(Decrease)/increase in other payables (excluding share issue costs)							(269,282)		164,220
Net cash outflows from operating activities							(436,390)		(251,392)
Cash flows from financing activities
Issue of Public Shares				4			-		150,141,850
Issue of Sponsor Shares				4			-		36,620
Issue of Sponsor Warrants				5			-		6,331,977
Issue costs settled during the period							-		(3,454,302)
Net cash inflows from financing activities							-		153,056,145
Cash flows from investing activities
Increase in restricted cash*				3			(417,383)		(150,146,837)
Decrease/(increase) in other receivables				6			1,000,000		(1,000,000)
Net cash inflows/(outflows) from investing activities							582,617		(151,146,837)
Net increase in cash and cash equivalents							146,227		1,657,916
Cash and cash equivalents at beginning of period							1,657,916		-
Cash and cash equivalents at end of period				3			1,804,143		1,657,916

*The increase in restricted cash during the period relates solely to interest earned.

The accompanying notes on below form an integral part of these Financial Statements.

NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS

For the period from 1 January 2022 to 30 June 2022

1.  General information

Hambro Perks Acquisition Company Limited (the "Company") was incorporated and registered in Guernsey under The Companies (Guernsey) Law, 2008 on 14 April 2021 with a registration number 69093 as a special purpose acquisition company ("SPAC") incorporated for the purpose of acquiring a majority (or otherwise controlling) stake in a company or operating business (the "Target" or "Target Business") through a merger, capital stock exchange, share purchase, asset acquisition, realisation or similar transaction (a "Business Combination"). The Company intends to focus on the technology-enabled sector and businesses with principal business operations in the United Kingdom.

The Financial Statements of the Company (the "Financial Statements") are prepared in accordance with International Financial Reporting Standards as adopted by the EU ("IFRS"), interpretations issued by the IFRS Interpretations Committee ("IFRIC"), with the Companies (Guernsey) Law, 2008 and the main market listing rules.

These financial statements have not been audited or reviewed by our auditors.

2.  Principal accounting policies

The Company is not presently engaged in any activities other than those which are required in connection with the selection, structuring and completion of an acquisition in a target business by means of a merger, share exchange, share purchase, contribution in kind, asset acquisition or combination of these methods (a "Business Combination").

The Financial Statements have been prepared in accordance with applicable law, the Company's principal documents and International Financial Reporting Standards ("IFRS").

The Financial Statements are presented in Pounds Sterling, which is the Company's functional and presentational currency, and has been prepared under the historical cost convention, rounded to the nearest whole Pound Sterling.

The Company had no operations and therefore no segmental information is presented.

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the Company's Financial Statements:

Basis of preparation

The Company's Financial Statements have been prepared on a historical cost basis, as modified by the revaluation of financial instruments measured at fair value through profit or loss.

These condensed interim financial statements included in this half-yearly report have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting". The same accounting policies and methods of computation are followed in the interim financial statements as compared with the annual financial statements. These condensed interim financial statements do not include all information and disclosures required in the annual financial statements and should be read in conjunction with the Company's annual financial statements as of 31 December 2021.

Going Concern

The Board has assessed the Company's financial position as at 30 June 2022 and the factors that may impact the Company for a period of 12 months from the date of signing of these Financial Statements.

In particular, the Board has reviewed the Company's committed expenses for the period which leaves a significant cash buffer in excess of £1.05 million. As these committed expenses are in line with signed engagement letters or agreements, the Board takes comfort that these expenses can be reliably measured and factored into their budgeting.

The cash buffer would be utilised in the event of any aborted deal however, the Board considers the likelihood of such an event to be low and if it should occur, would likely be in the early stages of any potential transaction where the costs incurred would be below £0.5 million.

In addition, the Board has noted that the Company's policy is that no dividend will be declared until after a successful Business Combination to ensure that capital is maintained in the period prior to the Business Combination.

If a Business Combination has not been completed by 25 August 2023 then the Company will be placed into liquidation. As a result the Board consider that there is a material uncertainty over the Company's going concern.

The Board is satisfied that the Company has adequate resources to continue in operation for the foreseeable future and to meet its liabilities as and when they fall due. The Directors also note that the Company's operations have not been significantly affected by the Covid-19 pandemic. Whilst there is material uncertainty related to going concern, the Board is of the opinion that it is appropriate to prepare these Interim Financial Statements on a going concern basis.

Fair value measurement

All financial instruments for which fair value is recognised or disclosed are categorised within the fair value hierarchy, which consists of the following 3 levels:

• Level 1 - unadjusted quoted prices in active markets for identical, unrestricted assets or liabilities;

• Level 2 - quoted prices in markets that are not active, or financial instruments for which all significant inputs 
  are observable from the market, either directly (as prices) or indirectly (as derived from prices); and

• Level 3 - prices or valuations that require inputs that are not based on observable market data (unobservable
  inputs).

The Board considers observable data to be market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.   

The table below analyses within the fair value hierarchy the company's financial instruments: 

30 June 2022	Level 1	Level 2	Level 3	Total
	£	£	£	£
Derivative Liabilities	788,244	664,858	-	1,453,103

31 December 2021	Level 1	Level 2	Level 3	Total
	£	£	£	£
Derivative Liabilities	-	-	7,888,266	7,888,266

Investments whose values are based simply on quoted market prices in active markets are classified within level 1. At 30 June 2022 and 31 December 2021, it was the opinion of the Investment Board that the Public Shares should be categorised as level 1.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs would be classified within level 2. As level 2 investments include positions that are not traded in active markets, and/or are subject to transfer restrictions, valuations are discounted to reflect illiquidity and/or non-transferability, which are generally based on available market information. At 30 June 2022 it was the opinion of the Board that Sponsor Warrants should be categorised as level 2 using the quoted price of the public warrants without an illiquidity discount.

Investments classified within level 3 have significant unobservable inputs as they trade infrequently. As observable prices are not available for the investments, the Investment Manager uses valuation techniques to derive their fair value. At 31 December 2021, it was the opinion of the Board that the Public and Sponsor Warrants should be categorised as level 3.

The Public Warrants were admitted to LSE in January 2022 and during the period were reclassified to level 1 as there is a quoted market price available for them. Sponsor Warrants are valued using the quoted price of the Public Warrants and during the period were reclassified to level 2.

The following summarises the valuation methodologies and inputs used for derivative liabilities categorised in Level 3.

31 December 2021	Fair value combined	Valuation methodologies	Unobservable inputs
Private equity investments	GBP
Derivative Liabilities	7,888,266	Black Scholes Option Pricing Method	Volatility Years to expiration

The following table provides information about the sensitivity of the period end fair value measurement to changes in the most significant inputs:

31 December 2021

Description	Significant unobservable input	Estimate of the input	Sensitivity of the fair value measurement of the input
Derivative Liabilities	Volatility	8.7%	An increase to 9.7% (decrease to 7.7%) would increase (decrease) fair value by £1,522,297 (£1,245,516).
Derivative Liabilities	Years to expiration	6 years, 8 months	Decrease by 6 months (Business Combination occurs at end of 15 month initial period) the fair value would decrease by £465,780.

New and amended standards and interpretations applied

The following accounting standards and updates were applicable in the reporting period but did not have a material impact on the Company:

-  Amendments to IFRS 1 and IFRS 9 Annual Improvements to IFRS 2018-2020

-  Amendments to IFRS 3: Business Combinations

-  Amendments to IAS 16: Property, Plant and Equipment

-  Amendments to IAS 37: Provisions, Contingent Liabilities and Contingent Assets

New and amended standards and interpretations not applied

The following new and amended standards and interpretations in issue are applicable to the Company but are not yet effective and therefore, have not been adopted by the Company:

-  IFRS 17: Insurance Contracts (effective 1 January 2023)

-  Amendments to IAS 17: Insurance Contracts (effective 1 January 2023)

-  Amendments to IAS 8: Accounting Policies, Changes in Accounting Estimates and Errors (effective 1 January 2023)

-  Amendments to IAS 12: Income Taxes (effective 1 January 2023)

-  Amendments to IAS 1: Presentation of Financial Statements (effective 1 January 2023)

The Company has considered the IFRS's in issue but not yet effective and do not consider any to have a material impact on the Company.

Tax status

The tax legislation of the jurisdiction in which a prospective investor is resident for tax purposes or otherwise subject  to tax and the tax legislation of Guernsey may have an impact on the income received from the securities. Prospective investors considering an investment in the Shares cum Rights, comprising the Public Shares and Public Warrants, should consult their advisors on the possible income tax consequences of investing in such securities under the laws of their country of citizenship, residence or domicile.

Use of judgements and estimates

The preparation of Financial Statements in accordance with IFRS requires the Board to make judgements, estimates and assumptions that affect the application of policies and the reported amounts of assets and liabilities and income and expenses. The estimates and associated assumptions are based on various factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on a semi-annual basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The principal judgements and estimates are as follows:

Judgements

Share-based payments

Regarding the Sponsor Shares issued by the Company, the Board has exercised judgement in determining whether the Sponsor Shares should be treated as a financial instrument (IAS 32) or share based payments (IFRS 2).

IFRS 2 applies to any transaction in which an entity receives goods or services as part of a share based payment arrangement. Careful consideration of all facts and circumstances, such as whether the rights of the Sponsor Shareholders differ from those of the Public Shareholders, is required to determine if IFRS 2 applies. In making this determination, the following factors have been considered.

· Should a Business Combination be successfully achieved, a proportion of the Sponsor Shares will automatically convert into Public Shares at no further cost to the Sponsor Shareholders. As the issue price of each Sponsor Share was £0.01, this represents a considerable discount to the price paid by Public Shareholders;

· The number of Sponsor Shares that may be converted to Public Shares may increase further, subject to certain performance-related conditions subsequent to the Business Combination;

· Notwithstanding that the Sponsor is providing its services to the Company in an equivalent capacity to an employment relationship, the conversion of the Sponsor Shares to Public Shares is entirely contingent on the successful consummation of a Business Combination, and no reward will accrue to the Sponsor for its services in the event that a Business Combination is not consummated.

Accordingly, the Board has exercised judgement in determining that the Sponsor Shares fall under the scope of IFRS 2 as equity-settled share based payments. The fair value at the grant date of equity-settled share based payments is generally recognised as an expense with a corresponding increase in equity over the vesting period.

The deemed grant date of the Public Shares will determine the point at which the Public Shares will be accounted for under IFRS 2. The Board has determined that the effective grant date for the Public Shares is the point of consummation of a Business Combination, and not the original date of issue of the Sponsor Shares for the following reasons:

· No contractual obligation on the part of the Company to deliver cash or any other financial asset to holders of the Sponsor Shares exists prior to a Business Combination, and the Sponsor Shareholders are not entitled to any preferential terms over holders of Public Shares;

· Should the Sponsor fail to successfully achieve a Business Combination, then the Sponsor Shares will not be eligible for conversion to Public Shares and the Sponsor will receive no material compensation for their work in attempting to identify a target acquisition;

· Under the Lock-up and Waiver Agreement, the Sponsor has agreed to waive its right to any liquidating distributions from the Escrow Account; and

The Sponsor did not commence any services related to target screening, searching out, identifying and evaluating potential Business Combinations for the company until after the admission of the Public Warrant on 7 January 2022.

As a result, no expense for such payments will be recognised until the Business Combination is consummated. At that date (and potentially certain later dates should certain triggering events occur) an expense will be recognised in the Statement of Comprehensive Income on a fair value basis.

Sponsor Warrants

Similarly to Sponsor Shares, the Board has exercised judgement in determining whether the Sponsor Warrants  should be treated as a financial instrument (IAS 32) or share based payments (IFRS 2). IFRS 2 applies to any transaction in which an entity receives goods or services as part of a share-based payment arrangement. That determination requires careful consideration of all the facts and circumstances, such as whether the rights of the Sponsor Warrant holders differ from those of the Public Warrant holders. The board have determined that Sponsor Warrants do not fall within the scope of IFRS 2 for the following reasons:

· The Sponsor Warrants were issued at a price of £1 per Warrant and are exercisable at a price of £11.50 per Public Share, which do not represent preferential terms to those afforded to Public Warrant holders;

· No further Sponsor Warrants are receivable for zero or discounted consideration;

· The commercial basis for the issue of Sponsor Warrants is to provide sufficient capital to cover the Company's listing costs and operating expenses until the achievement of a Business Combination, without diluting the value of the Public Shareholders' shares;

· There are no service conditions attached to the Sponsor Warrants;

· Sponsor Warrant holders have no different rights from Public Warrant holders in the event of a successful Business Combination or the failure to achieve such a combination.

The Board's judgement is that the Sponsor Warrants are a puttable financial instrument that includes a contractual obligation for the issuer to redeem that instrument for cash or another financial asset (in this case, a Public Share) upon exercise. The Sponsor Warrants do not entitle the holder to a pro rata share of the entity's assets in the event of the entity's liquidation and are therefore classified as a financial liability in accordance with section 16 of IAS 32.

Deferred underwriting fee

Citigroup Global Markets Limited ("the Underwriter" of the Company's Placing) is potentially entitled to a deferred underwriting fee. The Board has exercised judgement in determining that at the year-end and 30 June 2022, no liability in relation to this fee exists as IAS 32 requires the recognition of the worst-case liability which would be to repay the funds raised to shareholders if no business combination is completed. This underwriting fee is only payable on the completion of a Business Combination and will be paid from the funds held in the Escrow account.

Estimates

Fair value of derivative financial instruments at fair value through profit or loss

The Company recognises its investment in derivative instruments (Public Warrants and Sponsor Warrants) initially at fair value at date of issuance with any subsequent movement in fair value between the issuance date and the reporting date being recognised as a fair value movement through profit and loss. As at 31 December 2021, a third party valued the Warrants using an appropriate valuation model and determined the fair value at the date of issuance to be £0.73 per warrant and the fair value at year-end date to be £0.57 per warrant. As at 31 December 2021, judgements were required for the inputs into the valuation model specifically volatility rates of suitable comparable companies and estimated life of the warrants (see note 2 for details). As at 30 June 2022, the fair value was determined using the quoted price of £0.105 per warrant.

3.  Cash and cash equivalents

		30 June 2022	31 December 2021
		£	£
Restricted cash		150,564,220	150,146,837
Cash and cash equivalents		1,804,143	1,657,916
Total		152,368,363	151,804,753

Pursuant to the terms of the Escrow Agreement and in accordance with the requirements set out in Listing Rule 5.6.18A(2), the Company may only direct the release of cash held in escrow ("restricted cash") upon the occurrence of a payment event, being any of:

· redemption by any holder of Public Shares in connection with the completion of a Business Combination (which has been approved by the Board and the Required Majority at the Business Combination General Meeting, in each case in accordance with the requirements of the Articles of Incorporation);

· the passing of the Business Combination Deadline without the Company completing a Business Combination;

· approval by the Board of the Business Combination, and the Required Majority adopting a resolution to approve the Business Combination prior to the Business Combination Deadline, in each case in accordance with the requirements of the Articles of Incorporation;

· the winding-up or liquidation of the Company; or

· income tax on interest earned (if any) on the funds in escrow becoming payable by the Company.

The Escrow Agent shall also be permitted to release funds in the Escrow Account in accordance with the terms of a Judgement determining entitlement of the Company or any other person to the funds or any portion thereof, provided that, at the Escrow Agent's sole discretion, such Judgement shall be accompanied by a legal opinion confirming the effect of such Judgement, that it represents a final adjudication of the rights of the parties and that the time for appeal from such Judgement has expired without an appeal being made.

4. Issued share capital

The following summarises the issued share capital as at 30 June 2022 and 31 December 2021.

Shares
		No. of shares	£
Redeemable Class A ordinary shares of no par value ("Public Shares")		14,647,985	146,479,850
Non-redeemable Class A ordinary shares of no par value ("Public Shares")		366,200	3,662,000
Class B ordinary shares of no par value ("Sponsor Shares")		3,661,996	36,620
		18,676,181	150,178,470

Class A ordinary shares ("Public Shares")

Further to publication of its prospectus on 25 November 2021, the Company completed the placing of 14,350,000 units of the Company at a price of £10 per unit, each unit comprising one Public Share in the Company and the right to receive one half of one warrant in respect of Public Shares ("Public Warrant"). 350,000 of these Public Shares were issued to the Sponsor via the Company's Overfunding Subscription.

On 30 November 2021, the Company announced the admission of 14,350,000 Public Shares to trading on the London Stock Exchange's main market for listed securities ("LSE").

On 3 December 2021, the Company announced that Citigroup Global Markets Limited, acting as Stabilisation Manager, had partially exercised the Over-allotment Option granted by the Company in respect of 647,985 units, at a price of £10 per unit. Accordingly, 647,985 Public Shares were admitted to trading on LSE on 7 December 2021. The Over-allotment Option was granted to the Stabilisation Manager to enable the Stabilisation Manager to require the Company to issue up to 1,000,000 Option Units, each option Unit comprising one Public Share in the Company and the right to receive one half of one Public Warrant.

In addition, and as disclosed in the Prospectus, HPAC Sponsor LLP (the "Sponsor") subscribed for a further 16,200 units via the Overfunding Subscription. Accordingly, a further 16,200 Public Shares were admitted to trading on LSE on 10 December 2021.

As at 30 June 2022 and 31 December 2021, the total number of Public Shares admitted to trading is 15,014,185, of which 366,200 Shares were issued to the Sponsor via the Overfunding Subscription and the Over-allotment Option. These latter shares are subject to the Lock-up and Waiver Agreement (see note 9), which, inter alia, removes the right of redemption attached to these Public Shares, which are accordingly classified as equity. These 366,200 shares alongside the 3,661,996 Class B ordinary shares make up share capital net of share issuance costs of £93,856.

Holders of the remaining 14,647,985 Public Shares are entitled to redeem all or a portion of their Public Shares upon the completion of the business combination. Accordingly, these Public Shares are classified as liabilities in the Company's Statement of Financial Position and are measured at amortised cost.

Public Shares carry the right to receive dividends and other distributions declared on them, and holders of Public Shares are entitled to one vote per share at a general shareholders' meeting of the Company, including a vote on the proposed business combination.

Public Shares		30 June 2022	31 December 2021
		£	£
Opening balance		138,139,433	-
Proceeds of issue of Public Shares		-	146,479,850
Less: initial recognition of Public Warrants		-	(5,480,174)
Less: share issue costs		-	(3,577,995)
Effective interest accretion		3,563,237	717,752
		141,702,670	138,139,433

Class B ordinary shares ("Sponsor Shares")

During the prior period, the Sponsor and the Directors subscribed to a total of 3,661,996 Sponsor Shares at a price of £0.01 per share.

As at 30 June 2022 and 31 December 2021, the total number of Sponsor Shares in issue was 3,661,996.

Upon completion of the Business Combination, the Sponsor Shares will convert on the trading day following the consummation of the Business Combination into such number of Public Shares that the number of Public Shares issuable to the Sponsor upon conversion of all Sponsor Shares will be equal, on an as-converted basis, to 8% of the total number of Ordinary Shares issued and outstanding as a result of the completion of the Placing (including the Public Shares issued pursuant to the Over-allotment Option). In addition, each Sponsor Share will be converted into Public Shares (in two further tranches equal to 6% of the total number of Ordinary Shares issued and outstanding) after the Business Combination subject to certain performance-related conditions.

Subject to the variation of certain voting rights and powers in respect of the Business Combination, Sponsor Shares carry the same shareholder rights as Public Shares. However, the Company's Sponsor and Directors have entered into a Lock-up and Waiver Agreement with the Company (see note 9), under which they have agreed to waive their redemption rights in respect of the Sponsor Shares or any Public Shares acquired as a result of conversion in connection with the Business Combination. Accordingly, the Sponsor Shares are classified as equity in the Company's Statement of Financial Position.

5.  Warrants

Public Warrants

On 7 January 2022, 7,507,088 Public Warrants, the right to which was included in the issue of units in the Company (see note 4), were admitted to trading on LSE.

Each Public Warrant gives the holder the right to subscribe for one Public Share at a price of £11.50 following the completion of the Business Combination.

Accordingly, the Public Warrants are classified as derivative liabilities and were initially recognised at their fair value of £0.73 per warrant at the issuance date of 25 November 2021. Between issuance date and 31 December 2021 a fair value movement of £1,201,134 was recognised through profit and loss.

As at 30 June 2022, the Public Warrants have been valued using their quoted price at £0.105 per Warrant and are recognised in these Financial Statements at a total value of £788,244.For the period end a fair value movement of £3,490,795 was recognised through profit and loss.

Sponsor Warrants

During the prior period, the Sponsor and the Directors subscribed to a total of 6,331,977 Sponsor Warrants at a price of £1 per warrant. Of the £6,331,977 raised from the issue of the Sponsor Warrants, a derivative liability was recognised at the fair value of £0.73 per warrant at the issuance date of 25 November 2021. The remainder was allocated to Other Reserves as a capital contribution to the Company.

As at 30 June 2022, the Sponsor Warrants have been valued at £0.105 per warrant and are recognised in these Financial Statements at a total value of £664,858. The movement in fair value of £2,944,369 has been recognised as a fair value movement through profit and loss. Each Sponsor Warrant gives the holder the right to subscribe for one Public Share at a price of £11.50 following the completion of the Business Combination.

6.  Other receivables

Other receivables includes an amount of £nil (2021:£1,000,000 due from Hambro Perks Limited, which was settled on 11 March 2022).

7.  Earnings per share

The calculation of basic and diluted earnings per share has been based on the following profit attributable to shareholders and weighted-average number of ordinary shares outstanding at the year end.

For the period ended 30 June 2022		Basic	Diluted
		£		£
Profit for the period		2,884,593		2,884,593
Weighted average number of shares		4,028,196		4,028,196
Earnings per share		£0.72		£0.72

For the period ended 31 December 2021		Basic	Diluted
		£		£
Profit for the period		£1,080,886		£1,080,886
Weighted average number of shares		531,950		531,950
Earnings per share		£2.03		£2.03

The weighted average number of ordinary shares is determined by reference to the 3,661,996 Class B Ordinary shares and 366,200 Public shares issued to the Sponsor and subject to the Lock-up and Waiver Agreement. Public and Sponsor Warrants are deemed to be anti-dilutive as the average market price of ordinary shares during the period did not exceed the £11.50 exercise price of the Warrants and they are therefore out of the money and excluded from the diluted earnings per share calculation. The 14,647,985 redeemable Public Shares under IAS 33 are deemed to be contingently issuable shares issuable only upon a Business Combination so under IAS 33.24 will be excluded from the earnings per share calculations until the Business Combination has occurred.

8.  Auditor's remuneration

Grant Thornton UK LLP ("GT") was appointed as independent auditor on 24 November 2021. The remuneration to Grant Thornton UK LLP and to other Grant Thornton member firms for audit of the Company's 2021 annual financial statements amounted to £97,850. As at 30 June 2022, £37,500 was unpaid (31 December 2021: £97,850).

The Audit Committee noted that the Company had incurred expenses for non-audit services provided by Grant Thornton during the period amounting to £5,000 (period to 31 December 2021: £134,930). Non-audit services during the period relate to agreed upon procedures in respect of the interim report and financial statements. The amount outstanding at the period end was £5,000 (31 December 2021: nil).

To fulfil its responsibility regarding the independence of the Auditor, the Audit Committee considered a report from the Auditor describing its arrangements to identify, report and manage any conflicts of interest.

9.  Related party transactions

From 14 April 2021 (being the Company's date of incorporation) to date, the Company has entered into the following related party transactions:

a)  the letters of appointment with each of the Directors (for further detail see note 10);

b)  the acquisition of 3,661,996 Sponsor Shares by the Sponsor and the Directors (note 4);

c)  the acquisition of 6,331,977 Sponsor Warrants by the Sponsor and the Directors at a price of £1 per Sponsor Warrant, the proceeds of which were used to finance the placing and listing expenses and the operating expenses of the Company prior to the completion of the Business Combination (note 5);

d)  the Lock-up and Waiver Agreement, under which the Sponsor and the Directors have agreed to waive their redemption rights in respect of their holding of Public or Sponsor Shares, and undertaken not to participate in the shareholder vote on the proposed Business Combination;

e)  the M&A Advisory Agreement (for further detail see note 10); and

f)  the acquisition of 366,200 Public Shares cum rights by the Sponsor at a price of £10 per Share under the Overfunding Subscription (note 4).

The Over-allotment Option is an option granted to the Stabilisation Manager by the Company, exercisable in full or in part during the period commencing on the date of the commencement of conditional dealings in the Public Shares on the London Stock Exchange and ending no later than 30 calendar days thereafter, pursuant to which the Stabilisation Manager may require the Company to issue at the fixed Placing Price of £10 up to 1,000,000 Option Units, comprising up to 7.1% of the aggregate number of Shares cum Rights sold in the Placing (excluding the Option Units), solely for the purpose of covering over-allotments and short positions, if any, in connection with the Placing or to facilitate stabilisation transactions, if any, with a view to supporting the market price of the Public Shares at a higher level than that which might otherwise prevail in the open market.

The over-allotment shares were issued to the Sponsor and were subsequently repurchased by the Company. These shares were held in treasury and loaned to the Stabilisation Manager under the Stock Loan Agreement. On exercise of the Over-allotment option, the Company was obliged to issue up to 1,000,000 Shares cum Rights in order to satisfy its obligations under the Option. Any unissued Shares cum Rights were required to be returned to the Company pursuant to the Stock Loan Agreement for cancellation upon expiry of the Option. The Over-allotment Option expired on 24 December 2021, and accordingly no further Shares may be issued thereunder.

During the period, the Directors received the following remuneration in the form of Directors' fees:

		For the period from 1 January 2022 to 30 June 2022		For the period from 14 April 2021 to 31 December 2021
		£		£
Sir Anthony Salz		20,000		4,164
Dominic Perks		20,000		4,164
Dominic Shorthouse		20,000		4,164
Matthew Wood		20,000		4,164
Dr Sarah Wood		20,000		3,508
		100,000		20,164

10.  Material agreements

Administration Agreement

Sanne Fund Services (Guernsey) Limited ("Sanne") was appointed pursuant to the terms of the Administration and Secretarial Support Services Agreement dated 25 November 2021

Under the terms of the Sanne Administration Agreement, Sanne was entitled to receive:

· A fixed administration fee of £30,000 per annum until a target acquisition is identified.

The Sanne administration fees for the period totalled £39,536 (period ended 31 December 2021: £3,041), of which £42,577 was outstanding at the period end (period ended 31 December: £3,041).

The Company terminated the agreement with Sanne with effect from 30 April 2022.

With effect from 1 May 2022 Ocorian Administration (Guernsey) Limited (the "Administrator") was appointed Administrator to the Company.

Under the terms of the Administration Agreement, the Administrator is entitled to receive:

· A fixed administration fee of £30,000 per annum until a target acquisition is identified.

· An abort fee capped at £20,000 in the event the project aborts at any time.

The Ocorian Administration fees for the period totalled £5,000, of which £5,000 was outstanding at the period end.

The administration agreement with Ocorian can be terminated by either party giving to the other not less than 90 calendar days' notice in writing (or such shorter notice as the parties may agree).

M&A Advisory Agreement

Hambro Perks Advisory LLP (the "Advisor") was appointed pursuant to the terms of the M&A Advisory Agreement dated 24 November 2021.

Under the terms of the M&A Advisory Agreement, the Advisor is entitled to receive a monthly fee of £10,000 commencing on the date of the M&A Advisory Agreement and ending on the earlier of the date of (i) completion of the Business Combination and (ii) the Business Combination deadline. The M&A Advisory Agreement may also be terminated by notice in writing by a party subject to certain events occurring.

During the period ended 30 June 2022, an amount of £60,000 was payable to the advisor (period ended 31 December 2021: £12,000), of which £20,000 was outstanding at the period end (period ended 31 December 2021: £12,000).

Directors' letters of appointment

The Company has no employees. The Directors are the only key management personnel of the Company. Each Director was appointed pursuant to a letter of appointment between the respective Director and the Company dated on each Directors respective appointment date.

Under the terms of the letters of appointment the Company's Directors each receive an annual fee of £40,000 per annum and will be reimbursed for any out-of-pocket expenses incurred in connection with activities on the Company's behalf, such as identifying potential Target Businesses and performing due diligence on suitable business combinations.

During the period ended 30 June 2022, the Directors fees amounted to £100,000 (period to 31 December 2021: £20,164), of which £50,000 was outstanding at the period end (period to 31 December 2021: £20,164).

Escrow Agreement

Citibank, N.A., London Branch (the "Escrow Agent") was appointed pursuant to the terms of the Escrow Agreement (the "Escrow Agreement"), dated 24 November 2021.

11.  Contingencies and commitments

The Underwriter of the Company's Placing is entitled to a deferred underwriting fee payable from the Escrow account upon the successful completion of a Business Combination. 

12.  Subsequent events

There were no other significant post period end events that require disclosure or adjustment in these Financial Statements.

OFFICERS AND ADVISORS

Directors:	Sir Anthony Salz (Chairman)
	Dominic Perks (Executive Director)
	Dominic Shorthouse (Executive Director)
	Matthew Wood (Independent Non-Executive Director)
	Sarah Wood (Independent Non-Executive Director)
Registered Office:	PO Box 286
	Floor 2, Trafalgar Court
	Les Banques, St. Peter Port
	Guernsey, GY1 4LY
Sponsor:	HPAC Sponsor LLP
	111 Buckingham Road
	London, SW1W 0SR
Advisor:	Hambro Perks Advisory Limited
	111 Buckingham Road
	London, SW1W 0SR
Company Secretary:	Peter Soliman
Sole Global Coordinator and	Citigroup Global Markets Limited
Bookrunner:	Citigroup Centre
	Canada Square
	Canary Wharf
	London, E14 5LB
Registrar:	Computershare Investor Services (Guernsey) Limited
	1st Floor Tudor House
	Le Bordage, St. Peter Port
	Guernsey, GY1 1DB
Independent Auditor:	Grant Thornton UK LLP
	30 Finsbury Square
	London, EC2A 1AG
Legal advisor to the Company	White & Cast LLP
as to US and English law:	5 Old Broad Street
	London
	EC2N 1DW
Legal advisor to the Company	Carey Olsen (Guernsey) LLP
as to Guernsey Law	Carey House
	Les Banques
	St. Peter Port
	Guernsey, GY1 4BZ
Legal advisor to the	Clifford Chance LLP
Bookrunner as to US and	10 Upper Bank Street
English law:	London, E14 5JJ
Company Number:	69093 (Registered in Guernsey)

 

END

 

 

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