Results of the Placing
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN HEREIN, IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION, DISTRIBUTION OR FORWARDING, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.
FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY JURISDICTION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
For immediate release
10 December 2020
Electrocomponents plc
RESULTS OF THE PLACING
Electrocomponents plc (Electrocomponents or the Company) announces the successful completion of the non-pre-emptive placing of ordinary shares in the capital of the Company announced earlier today (the Placing) as well as the concurrent offer made by the Company for retail investors to subscribe for Ordinary Shares via the PrimaryBid platform (the Retail Offer). The net proceeds raised from the Placing and Retail Offer will be used to fund the acquisition of Synovos and Needlers whilst targeting pro-forma net debt to adjusted EBITDA of below 1x for the year ending 31 March 2021. This will preserve the Group's financial strength and flexibility to invest in working capital to drive organic growth and execute on a growing pipeline of attractive bolt-ons.
A total of 21,518,181 new ordinary shares in the capital of the Company (the Placing Shares) have been placed by UBS AG London Branch (UBS) and Numis Securities Limited (Numis, and together with UBS, the Joint Bookrunners), at a price of 825 pence per Placing Share (the Placing Price).
In addition, retail investors have subscribed via the Retail Offer for a total of 300,000 new ordinary shares in the capital of the Company (the Retail Shares) at the Placing Price.
Together, the Placing and Retail Offer comprise 21,818,181 new ordinary shares to raise gross proceeds of approximately £180 million. The Placing Price of 825 pence represents a premium of 1.2% to the closing share price of 815.5 pence on 9 December 2020 and a discount of 2.9% to the middle market price at the time at which the Company and the Joint Bookrunners agreed the Placing Price. The Placing Shares and Retail Offer being issued represent together approximately 5% of the existing issued ordinary share capital of Electrocomponents prior to the Placing.
Electrocomponents consulted with a number of its shareholders prior to the Placing and has respected the principles of soft pre-emption through the allocation process. The Company is pleased by the strong support it has received from new and existing shareholders, including a number of its retail shareholders via the Retail Offer.
Columbia Threadneedle Investments (Columbia Threadneedle) is a substantial shareholder in the Company for the purposes of the Listing Rules as a result of being entitled to exercise, or to control the exercise of, over 10% of the votes able to be cast at general meetings of the Company. Columbia Threadneedle is therefore considered to be a related party for the purposes of the Listing Rules. Columbia Threadneedle has agreed to subscribe for 3,567,272 Placing Shares in the Placing, at an aggregate price of approximately £29.4 million. The participation in the Placing by Columbia Threadneedle constitutes a smaller related party transaction and falls within Listing Rule 11.1.10 R and this announcement is therefore made in accordance with Listing Rule 11.1.10R(2)(c).
Applications have been made to the Financial Conduct Authority (the FCA) and the London Stock Exchange plc (the LSE) respectively for the admission of the Placing Shares and the Retail Shares to the premium listing segment of the Official List of the FCA and to trading on the main market for listed securities of the LSE (together, Admission). It is expected that Admission will become effective on or before 8.00 a.m. on 14 December 2020. The Placing and Retail Offer is conditional upon, amongst other things, Admission becoming effective and upon the placing agreement between the Joint Bookrunners and the Company not being terminated in accordance with its terms.
The Placing Shares and Retail Shares, when issued, will be fully paid and will rank pari passu in all respects with each other and with the existing ordinary shares of the Company, including, without limitation, the right to receive all dividends and other distributions declared, made or paid after the date of issue.
Following Admission, the total number of shares in issue in Electrocomponents will be 469,861,995. Electrocomponents does not hold any ordinary shares as treasury shares. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.
The person responsible for releasing this announcement is Ian Haslegrave - Company Secretary & General Counsel .
Electrocomponents plc LEI: 549300KVXDURRKVWR37
For further information contact:
Electrocomponents +44 (0)20 7239 8400
Lindsley Ruth, Chief Executive Officer
David Egan, Chief Financial Officer
Lucy Sharma, VP Investor Relations
Tulchan Communications LLP +44 (0)20 7353 4200
Martin Robinson
Olivia Peters
Toby Zeal
UBS (Corporate Broker, Sponsor and Joint Bookrunner) +44 (0)20 7567 8000
John Woolland
David Roberts
Meera Sheth
Numis (Corporate Broker and Joint Bookrunner) +44 (0)20 7260 1000
Mark Lander
Julian Cater
George Price
IMPORTANT NOTICE
This announcement (the Announcement) and the information contained in it is not for publication, release or distribution, in whole or in part, directly or indirectly, in or into the United States, Australia, Canada, Japan or South Africa or any other jurisdiction in which publication, release or distribution would be unlawful. This Announcement is for information purposes only and does not constitute an offer to sell or issue, or the solicitation of an offer to buy, acquire or subscribe for shares in the capital of Electrocomponents (the Company) in the United States, Australia, Canada, Japan or South Africa or any other state or jurisdiction in which such offer or solicitation is not authorised or to any person to whom it is unlawful to make such offer or solicitation. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions. The Placing Shares and the Retail Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act) or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered, sold or transferred, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. The Retail Shares and, subject to certain limited exceptions, the Placing Shares are being offered and sold outside the United States in accordance with Regulation S under the Securities Act.
No public offering of the Placing Shares is being made in the United States, United Kingdom or elsewhere. All offers of the Placing Shares and the Retail Shares will be made pursuant to an exemption under the Prospectus Regulation (EU) 2017/1129, as amended from time to time, and includes any relevant implementing measure in any member state (the Prospectus Regulation) from the requirement to produce a prospectus. This Announcement is being distributed to persons in the United Kingdom only in circumstances in which section 21(1) of the Financial Services and Markets Act 2000, as amended (FSMA) does not apply.
No prospectus will be made available in connection with the matters contained in this Announcement and no such prospectus is required (in accordance with the Prospectus Regulation) to be published. This Announcement and the terms and conditions set out herein are for information purposes only and are directed only at persons who are: (a) persons in Member States of the European Economic Area who are qualified investors (within the meaning of article 2(e) of the Prospectus Regulation (Qualified Investors); and (b) in the United Kingdom, Qualified Investors who are persons who (i) have professional experience in matters relating to investments falling within the definition of investment professionals in article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the Order); (ii) are persons falling within article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc) of the Order; or (iii) are persons to whom it may otherwise be lawfully communicated; (all such persons together being referred to as relevant persons). This Announcement and the terms and conditions set out herein must not be acted on or relied on by persons who are not relevant persons. Persons distributing this Announcement must satisfy themselves that it is lawful to do so. Any investment or investment activity to which this Announcement and the terms and conditions set out herein relates is available only to relevant persons and will be engaged in only with relevant persons.
This Announcement has been issued by, and is the sole responsibility of, the Company. 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 Numis Securities Limited (Numis), UBS AG London Branch (UBS and together with Numis, the Joint Bookrunners and each a Joint Bookrunner), or by any of their affiliates or agents 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.
Each Joint Bookrunner is authorised and regulated in the United Kingdom by the Financial Conduct Authority (the FCA). Each Joint Bookrunner is acting solely for the Company and no one else in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for providing advice in relation to the Placing and/or any other matter referred to in this Announcement. Apart from the responsibilities and liabilities, if any, which may be imposed on the Joint Bookrunners by FSMA or by the regulatory regime established under it, neither Numis, UBS nor any of their affiliates accepts any responsibility whatsoever for the contents of the information contained in this Announcement or for any other statement made or purported to be made by or on behalf of any Joint Bookrunner or any of their affiliates in connection with the Company, the Placing Shares or the Placing. Numis, UBS and each of their affiliates accordingly disclaim all and any responsibility and liability whatsoever, whether arising in tort, contract or otherwise (save as referred to above) in respect of any statements or other information contained in this Announcement and no representation or warranty, express or implied, is made by any Joint Bookrunner or any of their affiliates as to the accuracy, completeness or sufficiency of the information contained in this Announcement. The Joint Bookrunners are not acting for the Company with respect to the Retail Offer and will have no responsibilities, duties or liabilities, whether direct or indirect, whether arising in tort, contract or otherwise in connection with the Retail Offer or to any person in connection with the Retail Offer.
The distribution of this Announcement and the offering of the Placing Shares and the Retail Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company and / or the Joint Bookrunners or any of their respective affiliates that would, or which is intended to, permit an offering of the Placing Shares or the Retail Shares in any jurisdiction or result in the possession or distribution of this Announcement or any other offering or publicity material relating to Placing Shares or the Retail Shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and the Joint Bookrunners to inform themselves about, and to observe, such restrictions.
This Announcement contains (or may contain) certain forward-looking statements with respect to certain of the Company's current expectations and projections about future events. These statements, which sometimes use words such as aim, anticipate, believe, intend, plan, estimate, expect and words of similar meaning, reflect the directors' beliefs and expectations and involve a number of risks, uncertainties and assumptions which could cause actual results and performance to differ materially from any expected future results or performance expressed or implied by the forward-looking statement. Statements contained in this Announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The information contained in this Announcement is subject to change without notice and, except as required by applicable law, the Company does not assume any responsibility or obligation to update publicly or review any of the forward-looking statements contained in it and nor do they intend to. You should not place undue reliance on forward-looking statements, which speak only as of the date of this Announcement. No statement in this Announcement is or is intended to be a profit forecast or profit estimate or to imply that the earnings of the Company for the current or future financial years will necessarily match or exceed the historical or published earnings of the Company. As a result of these risks, uncertainties and assumptions, the recipient should not place undue reliance on these forward-looking statements as a prediction of actual results or otherwise.
This Announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the Placing Shares or the Retail Shares. Any investment decision to buy Placing Shares in the Placing or Retail Shares in the Retail Offer must be made solely on the basis of publicly available information, which has not been independently verified by the Joint Bookrunners.
The information in this Announcement may not be forwarded or distributed to any other person and may not be reproduced in any manner whatsoever. Any forwarding, distribution, reproduction or disclosure of this information in whole or in part is unauthorised. Failure to comply with this directive may result in a violation of the Securities Act or the applicable laws of other jurisdictions.
This Announcement does not constitute an invitation to underwrite, subscribe for or otherwise acquire or dispose of any securities in any jurisdiction. This Announcement does not constitute a recommendation concerning any investor's option with respect to the Placing or the Retail Offer. Each investor or prospective investor should conduct his, her or its own investigation, analysis and evaluation of the business and data described in this Announcement and publicly available information. The price and value of securities can go down as well as up. Past performance is not a guide to future performance.
The Placing Shares to be issued pursuant to the Placing and the Retail Shares to be issued pursuant to the Retail Offer will not be admitted to trading on any stock exchange other than the London Stock Exchange.
Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.
Information to Distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended (MiFID II); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the MiFID II Product Governance Requirements), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any manufacturer (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such securities are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the Target Market Assessment). Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.
NOTWITHSTANDING ANYTHING IN THE FOREGOING, NO PUBLIC OFFERING OF THE PLACING SHARES IS BEING MADE BY ANY PERSON ANYWHERE AND THE COMPANY HAS NOT AUTHORISED OR CONSENTED TO ANY SUCH OFFERING IN RELATION TO THE PLACING SHARES.
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