Proposed Secondary Placing

RNS Number : 9572T

PPHE Hotel Group Limited

26 March 2019

 

THIS ANNOUNCEMENT AND THE INFORMATION IN IT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, ISRAEL OR ANY JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO. FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE ANY SHARES OR OTHER SECURITIES OF PPHE HOTEL GROUP LIMITED IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.

PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT. THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN ARTICLE 7 OF THE MARKET ABUSE REGULATION NO. 596/2014 ("MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

PPHE HOTEL GROUP LIMITED

("PPHE Hotel Group", the "Group" or the "Company")

Proposed secondary placing of up to 9,300,000 existing ordinary shares

The Company announces that it has been advised that Euro Plaza Holdings B.V. ("Euro Plaza"), Walford Investments Holdings Ltd ("Walford") and Aroundtown Real Estate Limited ("Aroundtown" and, together with Euro Plaza and Walford, the "Sellers") are proposing to sell in aggregate up to 9,300,000  existing ordinary shares of no par value in PPHE Hotel Group (the "Placing Shares"), pro rata to their existing shareholdings in the Company. The disposal will be through a placing of ordinary shares in the Company to institutional investors by means of an accelerated bookbuild offering (the "Placing") at a price of not less than 1,600 pence per Placing Share. The Placing Shares represent approximately 22 per cent. of the issued share capital of the Company (excluding treasury shares). The Company has been notified that the Placing is being undertaken in order to satisfy market demand, to broaden the institutional investor base of the Company and that the Sellers have been advised that a sale of the entire amount of the Placing Shares is expected to achieve the free float required for the Company to qualify for inclusion in the FTSE UK series of indices.

Euro Plaza is an indirect wholly-owned Dutch incorporated subsidiary of A.P.Y. Investments & Real Estate Ltd ("APY"). As at the date hereof, 98% of the shares in APY are held by Eli Papouchado (the Chairman of the Company) as trustee of an endowment created under Israeli law which he formed in 1998 (the "Endowment"). The primary beneficiaries of the Endowment are Eli Papouchado and his sons, Yoav Papouchado and Avner Papouchado, and the secondary beneficiaries are the children of Yoav and Avner. The remaining 2% of the shares in APY are held by Yoav and Avner Papouchado respectively (1% each). APY and its subsidiaries are part of an international construction, hotel and real estate group (the "Red Sea Group") that was founded by Eli Papouchado. Walford is wholly-owned by Clermont Corporate Services Limited, as trustee of certain trusts established for the benefit of Boris Ivesha (the President and Chief Executive Officer of the Company) and his family.

The Sellers have entered into a block trade agreement with finnCap Ltd ("finnCap"), Joh. Berenberg, Gossler & Co. KG, London Branch ("Berenberg"), Numis Securities Limited ("Numis Securities"), Barak Capital Underwriting Ltd ("Barak Capital") and Orion Underwriting and Issuances Ltd ("Orion") to act as joint bookrunners and placing agents in relation to the Placing (the "Joint Bookrunners"). 

The Placing is to begin immediately and the timing for the closing of the bookbuild process will be at the absolute discretion of the Joint Bookrunners. A further announcement will be made following completion of the bookbuild and pricing of the Placing.

The Sellers have agreed with finnCap and Berenberg not to sell any further ordinary shares for a period of 180 days after completion of the Placing subject to certain customary exceptions and except at the absolute discretion of both finnCap and Berenberg in order to maintain an orderly market.

As the Company has its registered office in Guernsey and its ordinary shares are admitted to trading on the Main Market of the London Stock Exchange, it is subject to the UK Takeover Code, with which the Company complies.

Eli Papouchado, Euro Plaza, Red Sea Club Ltd and A.A. Papo Trust Company Limited and other parties related to him (together the "Red Sea Parties") and Boris Ivesha, Walford and other parties related to him (together the "Ivesha Parties") are deemed to be acting in concert for the purposes of Rule 9 of the Takeover Code (the "Concert Party"). Depending on the number of Placing Shares sold, it is possible that following the Placing, the Concert Party will remain the holders in aggregate of not less than 30 per cent., but not more than 50 per cent. of the Company's issued share capital (excluding treasury shares). Should this be the case and any member of the Concert Party or any person acting in concert with any member of the Concert Party subsequently acquire an interest in any shares which increases the percentage of shares carrying voting rights in the Company in which the Concert Party (or any person acting in concert with the Concert Party) is interested, that person together with people acting in concert with that person will normally be required to make a general offer in cash to all shareholders in the Company, at the highest price paid by that person or any person acting in concert with that person for an interest in such shares within the preceding 12 months, for all the remaining equity share capital of that Company.

The Company is not a party to the Placing and will not receive any proceeds from the Placing.

The person responsible for arranging for the release of this announcement on behalf of the Company is Inbar Zilberman, General Counsel.

For further information, please contact:

PPHE Hotel Group Limited Daniel Kos Chief Financial Officer & Executive Director Robert Henke Executive Vice President of Commercial & Corporate Affairs	Tel: [phone]
Hudson Sandler Wendy Baker / Sophie Lister	Tel: [phone] Email: [e-mail]
finnCap Matt Goode, Emily Watts - Corporate Finance Andrew Burdis, Camille Gochez - ECM Berenberg Ben Wright, Mark Whitmore Numis Securities Michael Burke	Tel: [phone] Tel: [phone] Tel: [phone]
Barak Capital Tzvika Manes Orion Gal Frayden	Tel: [phone] Tel: [phone]

Important Notice:

MEMBERS OF THE GENERAL PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT AND ANY OFFER OF SECURITIES TO WHICH IT RELATES ARE ONLY ADDRESSED TO AND DIRECTED AT (1) IN ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA, PERSONS WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(1)(E) OF EU DIRECTIVE 2003/71/EC AND ANY RELEVANT IMPLEMENTING MEASURES (THE "PROSPECTUS DIRECTIVE"); (2) IN THE UNITED KINGDOM, PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS WHO FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (AS AMENDED) (THE "ORDER"); OR (II) FALL WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER OR (III) ARE PERSONS TO WHOM AN OFFER OF THE PLACING SHARES MAY OTHERWISE LAWFULLY BE MADE; AND (3) IN ISRAEL, PERSONS REFERRED TO IN SECTION 15A(b)(1) OF THE ISRAELI SECURITIES LAW, 5728- 1968, AND LISTED IN THE FIRST SCHEDULE THERETO (ALL SUCH PERSONS REFERRED TO IN (1), (2) AND (3) TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THE INFORMATION REGARDING THE PLACING SET OUT IN THIS ANNOUNCEMENT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.

EACH PLACEE SHOULD CONSULT ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES. THE PRICE OF ORDINARY SHARES IN THE COMPANY AND THE INCOME FROM THEM (IF ANY) MAY GO DOWN AS WELL AS UP AND INVESTORS MAY NOT GET BACK THE FULL AMOUNT INVESTED ON DISPOSAL OF ORDINARY SHARES.

NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, IS OR WILL BE MADE AS TO, OR IN RELATION TO, AND NO RESPONSIBILITY OR LIABILITY IS OR WILL BE ACCEPTED BY ANY OF THE COMPANY, THE SELLERS OR THE JOINT BOOKRUNNERS OR ANY OF THEIR RESPECTIVE AFFILIATES, AGENTS, DIRECTORS, OFFICERS OR EMPLOYEES AS TO, OR IN RELATION TO, THE ACCURACY OR COMPLETENESS OF THIS ANNOUNCEMENT OR ANY OTHER WRITTEN OR ORAL INFORMATION MADE AVAILABLE TO OR PUBLICLY AVAILABLE TO ANY INTERESTED PARTY OR ITS ADVISERS, AND ANY LIABILITY THEREFORE IS EXPRESSLY DISCLAIMED.

The Placing Shares have not been, and will not be, registered under the US Securities Act of 1933, as amended (the "Securities Act"), or under the securities laws of any State or other jurisdiction of the United States, and, absent registration, may not be offered or sold in the United States (as defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any relevant State or other jurisdiction of the United States. There will be no public offering of the Placing Shares in the United States.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States.

No prospectus or offering document has been or will be prepared in connection with the Placing. Any investment decision to buy securities in the Placing must be made solely on the basis of publicly available information. Such information is not the responsibility of and has not been independently verified by the Company, the Sellers, the Joint Bookrunners or any of their respective affiliates.

Neither this announcement nor any copy of it may be taken, transmitted or distributed, directly or indirectly, in or into or from the United States (including its territories and possessions, any State of the United States and the District of Columbia), Canada, Australia, South Africa, Japan or Israel. Any failure to comply with this restriction may constitute a violation of U.S., Canadian, Australian, South African, Japanese or Israeli securities laws.

The distribution of this announcement and the offering or sale of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company, the Sellers, the Joint Bookrunners or any of their respective affiliates that would, or which is intended to, permit a public offer of the Placing Shares in any jurisdiction, or possession or distribution of this announcement or any other offering or publicity material relating to the Placing Shares, in any jurisdiction where action for that purpose is required. Persons into whose possession this announcement comes are required by the Sellers and the Joint Bookrunners to inform themselves about and to observe any applicable restrictions.

Each of the Joint Bookrunners and any of their respective affiliates acting as an investor for its own account may participate in the offering on a proprietary basis and in that capacity may retain, purchase or sell for their own account such Placing Shares. In addition they may enter into financing arrangements and swaps with investors in connection with which they may from time to time acquire, hold or dispose of Placing Shares. The Joint Bookrunners do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligation to do so.

finnCap and Numis Securities are both regulated by the Financial Conduct Authority in the United Kingdom. Berenberg is authorised and regulated by the Federal Financial Supervisory Authority in Germany and subject to limited regulation by the Financial Conduct Authority in the United Kingdom.

Each Joint Bookrunner is acting only for the Sellers in connection with the Placing and will not be responsible to anyone other than the Sellers for providing the protections offered to its clients, nor for providing advice in relation to the Placing or any matters referred to in this announcement.

Forward-looking statements:

Certain statements in this announcement are forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial consequences of the plans and events described herein. No one undertakes any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Readers should not place any undue reliance on forward-looking statements which speak only as of the date of this announcement. Statements contained in this announcement regarding past trends or events should not be taken as representation that such trends or events will continue in the future.

 

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