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Charles Stanley Grp (CAY)

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Wednesday 15 April, 2015

Charles Stanley Grp

Pre-close Trading Update & Placing to raise £15.8m

RNS Number : 2566K
Charles Stanley Group PLC
15 April 2015
 

 

 

 

 

For Immediate Release

15 April 2015



 

THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) IS FOR INFORMATION PURPOSES ONLY AND SHALL NOT CONSTITUTE AN OFFER TO SELL OR ISSUE OR THE SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE OR ACQUIRE ANY SECURITIES, INCLUDING THE PLACING SHARES, IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO, THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA, JAPAN, JERSEY, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

 

CHARLES STANLEY GROUP PLC ("CHARLES STANLEY" OR THE "COMPANY")

PRE-CLOSE TRADING UPDATE,

STRATEGY UPDATE,

FINAL DIVIDEND

AND

PLACING TO RAISE £15.8 MILLION (NET OF EXPENSES)

TO STRENGTHEN CAPITAL RESERVES

 

 

In conjunction with Charles Stanley's pre-close trading update in respect of the year ended 31 March 2015, Charles Stanley announces the initial output of the new management team's strategic review of the business, the intention of the Board to recommend a final dividend in respect of the year ended 31 March 2015 of 2.0p per Ordinary Share and a placing to raise approximately £15.8 million (net of expenses) via the issue of 4,596,000 new Ordinary Shares with existing investors.

 

The new capital will strengthen Charles Stanley's balance sheet and solvency levels to in excess of 125% of the Financial Conduct Authority's ("FCA") regulatory capital requirement for the Group. This in turn will enable the new management team to accelerate the implementation of the Board's revised strategy which is expected to drive future growth in earnings and shareholder returns. The Board's target is to achieve a Group operating margin (before the impact of the FSCS levy and amortisation of intangibles) of at least 15% in 2018.

 

 

Paul Abberley, Chief Executive of Charles Stanley, commented:

 

"Having recently been appointed as CEO, I have seen first-hand the quality and breadth of our client offering, the expertise of our staff and the scale of our operations, all of which should enable us to take good advantage of the exciting growth opportunities that the wealth management industry provides. We have a strategy to modernise and significantly improve the operating performance of the Group and the Placing will help support the execution of such strategy."

 

 

 

Pre-Close trading update

 

 

Charles Stanley is providing a pre-close update on trading in the 12 months to 31 March 2015, ahead of announcing its preliminary results on or around Thursday, 18 June 2015:

 

·      The Board anticipates that underlying profits, excluding the impact of the FSCS levy, one-off restructuring costs and non-cash impairment charges, will be in line with current market expectation;

 

·      The net FSCS levy incurred during the year was £1.3 million;

 

·      Exceptional restructuring charges were incurred during the year and a profit on disposal of the Matterley Undervalued Asset Fund was realised. The overall impact of these items is expected to be a profit of approximately £0.8 million; and

 

·      The Board is currently conducting a thorough review of the carrying value of intangible assets and goodwill which amounted to £34.4 million at 30 September 2014. This review has not yet been completed and will be subject to external audit. Subject to this, the Board currently anticipates that in addition to an amortisation charge of approximately £1.8 million, an impairment charge of approximately £6.2 million may be made. Such a charge, which would be in addition to the £1.8 million impairment of intangible assets and unlisted available-for-sale financial assets made in the first half, will have no cash impact nor will it impact the Group's regulatory capital.

 

Funds Growth

 

The growth of funds under management and associated revenues has been encouraging, albeit that commission income declined, in part as a result of a major know-your-client and suitability review programme undertaken during the year which is now nearing completion:

 

·      Total funds under management and administration at 31 March 2015 reached a new high of £21.3 billion, up 6.0% from £20.1 billion at 31 March 2014; the WMA Balanced Index has risen 8.8% in the same period; and

 

·      Within that figure, discretionary managed funds increased by 13.4% to £9.3 billion up from £8.2 billion at 31 March 2014.

 

Revenues

 

Overall, unaudited Group revenues increased by 0.4%. However this figure masks a significant change in the source of revenues:

 

·      Fees within the Investment Management Services division grew 17.8% to £75.5 million. This increase was in part offset by a 13.9% decline in commission earnings, both as a result of lower bargain volumes and more clients being charged fee- only tariffs. Overall revenues for the division increased by 3.4%;

 

·      The Financial Services division and Charles Stanley Direct respectively enjoyed 13.1% and 39.1% increases in their revenues; and

 

·      After a particularly strong performance the prior year, Charles Stanley Securities' revenues fell to £8.1 million.

 

Costs and impact on profits

 

As previously noted in the Group's interim results for the six months ended 30 September 2014, costs have increased at a considerably greater rate than revenues. There have been two main reasons for this. Costs necessarily incurred to develop a more robust systems and controls environment within Charles Stanley; and in certain areas, poor cost control.

 

 

 

Trading outlook

 

Whilst trading in the last quarter picked up and global equity markets have shown resilience, the near term impact that the General Election may have is uncertain. Nevertheless, the Board believes that as the suitability review programme nears its end this should enable Charles Stanley's Investment Managers to devote more time to growing their client base and revenues.

 

Dividends

 

Final Dividend

 

In view of the Group's trading performance during the year and need to strengthen the Group's capital reserves, the Board intends to recommend a final dividend in respect of the year ending 31 March 2015 of 2.0p. Taken together with the interim dividend of 3.0p, this will represent a total dividend for the year of 5.0p (2014: 12.25p).

 

Future Dividend Policy

 

The Board has rebased the total dividend paid to 5p per Ordinary Share, as it seeks to strengthen the Group's capital base. Over the medium term the intention is to move towards a target dividend cover of two times earnings per Ordinary Share, as adjusted for the amortisation of intangible assets, and thereafter the intention is to grow the dividend progressively.

 

Strategy

 

Following the announcement in September 2014 that Sir David Howard would relinquish his position as chief executive and become non-executive Chairman, Charles Stanley has announced a series of further board and related changes to establish a new management structure. These have included the appointment of Paul Abberley as Chief Executive Officer in December 2014 and Ben Money-Coutts as Chief Financial Officer in January 2015 and the retirement of Michael Clark as an executive director in March 2015. In addition to these changes, there have also been changes to the senior executive team, including the appointment of Christopher Aldous as Head of Marketing, Michael Bennett as Chief Operating Officer, Peter Kelk as Chief Risk Officer and Duncan Taylor as Group Compliance Officer. Since the beginning of this calendar year the management team have undertaken an appraisal of the strategy, positioning and prospects for the Group.

 

A principal objective of the Board and its revised strategy is to target a Group operating margin (before the impact of the FSCS levy and amortisation of intangibles) of at least 15% in 2018.

 

It is the Board's intention to focus Charles Stanley entirely on wealth management. Accordingly the Board has decided to sell the principal elements of Charles Stanley Securities (which provides advisory, broking and corporate finance services for smaller and mid-cap UK listed companies) and Charles Stanley Financial Solutions (which provides employee benefit solutions). The Company is currently in negotiations with a view to the sale of both of these businesses. However, at this stage no assurance can be given that any such transactions will be entered into.

 

The Group will continue to be an investment led, holistic provider, focussing on bespoke investment advice for which the Charles Stanley brand is known and respected. Charles Stanley does intend, however, to be more active along the value chain, especially in relation to the provision of financial planning services (vertical integration), while maintaining a breadth of service offering (horizontal integration). Both these aspects are described in further detail below.

 

Regarding the value chain, it is intended that financial planning will become more important at Charles Stanley, reflecting growing client demand for broader planning advice beyond the investment management expertise we have traditionally offered. The current disaggregated model will be changed into a unitary structure: a single financial planning capability, offering a consistent suite of planning advice with clear leadership and governance.

 

Within its core Private Client Investment Management division, the Group intends to retain a bespoke approach with empowered investment managers, rather than moving to a model-driven relationship manager structure.

 

The holistic offering will continue to include SIPP administration (through EBS). The Board believes the SIPP market will continue to deliver significant growth opportunities. The Group intends to invest in new systems for EBS which the Board expects will support the continued development of this business with improved operating margins.

 

Whilst Charles Stanley will continue to be a full service, horizontally integrated business, it intends to provide traditional stockbroking services on a more selective basis. While the industry trend towards the provision of discretionary management continues, the Board believes there remains client demand and a willingness to pay for advisory services.

 

The Group will remain in the digital execution broking space via Charles Stanley Direct and will explore low cost automated advice capability, which the Board believes is likely to become an increasingly important segment of the market. The Board sees increasing demand for the digital capabilities of CSD to be used to support and enhance the online client service of the PCIM bespoke offering.

 

While the Board expects cost control initiatives should contribute to an early margin improvement, long term margin expansion must be driven by top line growth. The Group's distribution therefore will be accorded a higher priority and focus than in the past.

 

In particular, the IFA channel is expected to become more important to Charles Stanley with a more focused sales capability. The Board believes there are significant opportunities, particularly in the bespoke space through local delivery via the Group's national network. Similarly the Board considers there will also be opportunities in the smaller institutional space, particularly for products and solutions offered centrally by the CIP.

 

Charles Stanley's target direct client segments will be necessarily high end for the relatively cost-heavy bespoke service and mainstream affluent for CSD. Pricing levels and minimum account sizes will be reviewed accordingly.

 

As part of the execution of its strategy, the Board is of the opinion that it needs to achieve a closer alignment of interests between the Group's investment managers and Shareholders. This may involve the introduction of wider share scheme arrangements for key members of staff. Plans in relation to this are in their early stages and if it is decided to pursue such a route, Shareholders will be consulted in advance of its implementation.

 

In summary, to take advantage of the opportunities in the wealth management sector, Charles Stanley's approach will contain elements of both horizontal and vertical integration, but will be very much investment led. By moving towards a more integrated organisational model, the Board expects to be able to deliver cost savings, increase capacity and create a platform for improved levels of growth and profitability.

 

Reasons for the Placing and use of proceeds

 

The Directors consider it prudent for the Group to have headroom of at least 25% over the FCA regulatory capital requirement. The Group's regulatory capital requirement has risen in recent years, however its capital has been eroded by poor trading and uncovered dividend payments. As a consequence, the headroom has fallen below this level (whilst remaining in excess of the FCA's requirements). The main reason for the Placing is to restore such headroom.

 

The implementation of the Group's strategy inevitably involves a degree of execution risk and will take time to deliver, whilst the Group's trading performance is sensitive to market risk. Increasing the Group's capital headroom will improve its ability to withstand the impact of such risks and to pursue the Board's strategy outlined above.

 

Following the Placing it is anticipated that the regulatory capital headroom will be in excess of the Board's target. The Board intends to grow the headroom further over time through initiatives to reduce the level of the regulatory capital requirement relative to the scale of the business and through the potential for improved annual retained earnings. 

 

A small proportion of the proceeds is expected to be invested in further enhancements in both front and back-office operating systems with the aim of providing an improved client experience and delivering operating efficiencies. Any such investment, however, will only be made where a business appraisal has been conducted and timely pay-back identified.

 

 

Details of the Placing

 

Canaccord Genuity and Peel Hunt have agreed to place 4,596,000 new Ordinary Shares at 355p per share to raise approximately £15.8 million net of expenses. The Placing Shares are being placed with institutional investors, with certain of the Directors and the Chief Financial Officer also agreeing to subscribe for 30,772 Placing Shares, in each case subject to the terms and conditions of the Placing.

 

The Placing is subject to the terms and conditions set out in Appendix 2 to this announcement. The Placing is also subject to the conditions and termination rights set out in the Placing Agreement.

 

The Placing Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing ordinary shares of the Company, including the right to receive all dividends and other distributions declared, made or paid after the date of issue. The Placing Shares represent an increase of just under 10% of the current issued ordinary share capital of the Company.

 

The Placing does not require any further Shareholder approval. Application has been made for the Placing Shares to be admitted to the premium listing segment of the Official List of the FCA and to be admitted to trading on the main market for listed securities of the London Stock Exchange. Settlement for the Placing Shares and Admission are expected to take place on or before 8.00 a.m. on 17 April 2015. The Placing is conditional, among other things, upon Admission becoming effective.

 

Your attention is drawn to the Appendices which include further information about the Group's trading performance, the terms and conditions of the Placing and definitions.

 

For further information please contact:

 

Charles Stanley Group PLC

 

Charles Stanley Group PLC

Canaccord Genuity

Peel Hunt LLP

Paul Abberley, Chief Executive

Martin Green

Guy Wiehahn

Ben Money-Coutts,

Chief Financial Officer



Phone: 020 7739 8200

Phone: 020 7523 4619

Phone: 020 7418 8893




Magnus Wheatley

 

Head of Digital Marketing & Communications

 

Phone 020 7149 6273

 

 

 

 

IMPORTANT NOTICE

 

This announcement has been issued by, and is the sole responsibility of, the Company. This announcement is for information only and does not constitute an offer or invitation to underwrite, subscribe for or otherwise acquire or dispose of any securities or investment advice in any jurisdiction in which such an offer or solicitation is unlawful, including without limitation, the United States, the United Kingdom, Australia, Canada, the Republic of South Africa, Japan or Jersey.

 

No prospectus will be made available in connection with the matters contained in this announcement.

 

Canaccord Genuity and Peel Hunt, each of which is authorised and regulated in the United Kingdom by the FCAS, are acting for the Company and for no-one else in relation to the Placing, and will not be responsible to any other person for providing the protections afforded to their respective clients nor for providing advice in connection with the matters contained in this announcement. 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 Canaccord Genuity or Peel Hunt, or by any of their respective 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.

 

The distribution of this announcement and the placing of the Placing Shares as set out in this announcement may be restricted by law in certain jurisdictions. No action has been taken by the Company or either of the Placing Agents that would permit an offering of the Placing Shares 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 Company and the Placing Agents to inform themselves about, and to observe, such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

 

This announcement is directed only at persons (i) having professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (ii) who are high net worth entities falling within Article 49(2)(a) to (d) of the Order, and other persons to whom it may otherwise lawfully be communicated (all such persons together being referred to as "relevant persons"). This announcement must not be acted on or relied on in the United Kingdom by persons who are not relevant persons.

 

In member states of the European Economic Area, this announcement is only addressed to and directed at persons who are 'qualified investors' within the meaning of Article 2(1)(e) of the Prospectus Directive (including any relevant implementing measure in each Relevant Member State) ("Qualified Investors").

 

This announcement is not for distribution, directly or indirectly, in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia).

 

This announcement does not constitute or form part of an offer of, or solicitation to purchase or subscribe for, securities in the United States. The Placing Shares may not be offered, sold or transferred, directly or indirectly, within the United States absent registration under the US Securities Act of 1933 (the "Securities Act") or an exemption therefrom. The Company has not registered and does not intend to register any of the Placing Shares under the Securities Act. No money, securities or other consideration is being solicited from any person inside the United States and, if sent in response to the information herein, will not be accepted. The Placing Shares will not be offered or sold to the public in the United States.

 

Any indication in this announcement of the price at which Ordinary Shares have been bought or sold in the past cannot be relied upon as a guide to future performance. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that the earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.

 

The price of Ordinary Shares and the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the Placing Shares.

 

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

 

FORWARD-LOOKING STATEMENTS

 

Certain statements included in this announcement contain forward-looking information concerning the Company's strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the sectors or markets in which the Company operates. By their nature, forward-looking statements involve uncertainty because they depend on future circumstances, and relate to events, not all of which are within the Company's control or can be predicted by the Company. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from those set out in the forward-looking statements.

 

In particular, references to the Group's target operating margin and future dividend policy and cover should not be taken as a forecast of the Company's future performance, profits or results.  The target margin and dividend cover are targets only and there is no guarantee whatsoever that they can or will be achieved and should not be taken as an indication of the Company's actual return.  No reliance may be placed upon the same. 

 

Nothing in this announcement should be construed as a profit forecast and no part of these results constitutes, or shall be taken to constitute, an invitation or inducement to invest in the Company, and must not be relied upon in any way in connection with any investment decision. Any forward-looking statements made herein by or on behalf of the Company speak only as of the date they are made. Except as required by the FCA, the London Stock Exchange or by applicable law, the Prospectus Rules, the Listing Rules or the Disclosure and Transparency Rules, the Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this announcement to reflect any changes in the Company's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.

 



 

 

 

Appendix 1


FUNDS UNDER MANAGEMENT AND ADMINISTRATION

 


 

 

 Mar 15

 

 

 Mar 14

Change since

Mar 14


£ bn

£ bn

%





Discretionary funds

9.3

8.2

13.4%

Advisory managed funds

3.0

3.0

(0.0%)





Total managed funds

12.3

11.2

9.8%





Advisory dealing funds

2.1

2.4

(12.5%)

Execution only funds

6.9

6.5

6.2%





Total administered funds

9.0

8.9

1.1%





Total funds under management and administration

21.3

20.1

6.0%









FTSE 100 index

6,773

6,598

2.7%









WMA benchmark

3,684

3,385

8.8%





 

 

The change since March 2014 is explained in more detail in the tables below:

 


Discretionary

managed

Advisory managed

 

Total

 

Change


£ bn

£ bn

£ bn

%






Funds at 1 April 2014

8.23

2.99












New investment managers

0.22

0.03


Net inflow/(outflow) from existing clients

0.18

(0.09)


Net transfers

0.14

(0.13)


Lost clients

(0.14)

(0.06)












Net inflow of funds

0.40

(0.25)

1.3%











Market movement

0.68

0.23

8.1%











Funds at 31 March 2015

9.31

2.97












 

 

  

 

REVENUE

 

 

Year ended 31 March 2015


Investment Management Services

£'000

 

Financial Services

£'000

Charles Stanley Direct

£'000

Charles Stanley Securities

£'000

 

 

Total

£'000

Fees






    Investment Management

56,558

1,689

-

-

58,247

    Administration                 

18,993

13,238

3,982

158

36,371

    Corporate Finance

-

-

-

4,545

4,545

Total fees

75,551

14,927

3,982

4,703

99,163







Commission

45,809

408

858

3,440

50,515







Total

121,360

15,335

4,840

8,143

149,678







 

Year ended 31 March 2014


Investment Management Services

£'000

 

Financial Services

£'000

Charles Stanley Direct

£'000

Charles Stanley Securities*

£'000

 

 

Total

£'000

Fees






    Investment Management

44,592

885

-

-

45,477

    Administration                 

19,534

12,254

2,727

109

34,624

    Corporate Finance

-

-

-

10,525

10,525

Total fees

64,126

13,139

2,727

10,634

90,626







Commission

53,203

424

753

4,022

58,402







Total

117,329

13,563

3,480

14,656

149,028







 

 

 

*      Charles Stanley Securities' revenues in 2014 included £2.329 million contributed by WG Partners where the relationship terminated at the end of the financial year ended 31 March 2014.


Appendix 2

 

Terms and Conditions of the Placing

 

IMPORTANT INFORMATION FOR PLACEES ONLY

 

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS DOCUMENT AND THE TERMS AND CONDITIONS SET OUT AND REFERRED TO HEREIN ARE DIRECTED ONLY AT PERSONS SELECTED BY CANACCORD GENUITY AND/OR PEEL HUNT WHO ARE "INVESTMENT PROFESSIONALS" FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "FPO") OR "HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS ETC" FALLING WITHIN ARTICLE 49(2) OF THE FPO OR TO PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS DOCUMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS.

 

THE PLACING SHARES THAT ARE THE SUBJECT OF THE PLACING ARE NOT BEING OFFERED OR SOLD TO ANY PERSON IN THE EUROPEAN UNION, OTHER THAN TO "QUALIFIED INVESTORS" AS DEFINED IN ARTICLE 2.1(E) OF DIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE"), WHICH INCLUDES LEGAL ENTITIES WHICH ARE REGULATED BY THE FCA OR ENTITIES WHICH ARE NOT SO REGULATED WHOSE CORPORATE PURPOSE IS SOLELY TO INVEST IN SECURITIES OR TO SUCH OTHER PERSONS AS ARE AGREED BY THE PLACING AGENTS.

 

The Placing Shares have not been and will not be registered under the United States 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 may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States or to, or for the account or benefit of, US Persons (as defined in Regulation S under the Securities Act). "United States" means the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia. No public offering of the Placing Shares is being made in the United States. Persons receiving this document (including custodians, nominees and trustees) must not forward, distribute, mail or otherwise transmit it in or into the United States or use the United States mails, directly or indirectly, in connection with the Placing.

 

This document does not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction including, without limitation, the United States, Canada, Australia, the Republic of South Africa, Japan, or Jersey in which such offer or solicitation is or may be unlawful (a "Prohibited Jurisdiction"). This document and the information contained herein are not for publication or distribution, directly or indirectly, to persons in a Prohibited Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction.

 

The distribution of this document, the Placing and/or issue of the Placing Shares in certain jurisdictions may be restricted by law and/or regulation. No action has been taken by the Company, Canaccord Genuity, Peel Hunt or any of their respective Affiliates (as defined below) that would permit an offer of the Placing Shares or possession or distribution of this document or any other publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons receiving this document are required to inform themselves about and to observe any such restrictions.

 

Canaccord Genuity Limited and Peel Hunt LLP are regulated in the United Kingdom by the Financial Conduct Authority, are acting for Charles Stanley and for no one else in connection with the Placing and will not be responsible to anyone other than Charles Stanley for providing the protections afforded to clients of Canaccord Genuity or Peel Hunt (as appropriate) or for affording advice in relation to the Placing, or any other matters referred to herein.

 

By participating in the Placing, each person who is invited to and who chooses to participate in the Placing (a "Placee") by making an oral offer to take up Placing Shares is deemed to have read and understood this document in its entirety and to be making such offer on the terms and conditions contained herein, and to be providing the representations, warranties, undertakings, agreements and acknowledgements contained herein.

 

Details of the Placing Agreement and the Placing Shares

 

The Company has entered into the Placing Agreement with the Placing Agents, under which the Placing Agents have, subject to the terms set out therein, severally agreed to use their respective reasonable endeavours, as agents of the Company, to procure Placees for the Placing Shares. In accordance with the terms of the Placing Agreement and a subscription and transfer agreement between the Company, Canaccord Genuity and a Jersey incorporated subsidiary of the Company (the "Subscription and Transfer Agreement"), the allotment and issue of the Placing Shares will be made by the Company to Placees in consideration for the transfer to the Company of certain shares in that Jersey incorporated subsidiary of the Company by Canaccord Genuity. To the extent that any Placee procured by the Placing Agents fails to subscribe for any or all of the Ordinary Shares which have been allocated to it in the Placing and for which it has agreed to subscribe (the "Defaulted Shares"), each Placing Agent has agreed, as principal to severally acquire its Relevant Proportion of the Defaulted Shares at the Placing Price (where "Relevant Proportion" shall mean in respect of Canaccord Genuity, 70% and Peel Hunt, 30%.

 

The Placing Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with each other and with the existing Ordinary Shares.

 

The Placing Shares will be issued free of any encumbrance, lien or other security interest.

 

Application for listing and admission to trading

 

Application has been made to the FCA (as the competent authority for listing) for admission of the Placing Shares to the Official List maintained by the FCA in accordance with section 74(1) of FSMA for the purposes of part VI of FSMA and to London Stock Exchange plc for admission to trading of the Placing Shares on the London Stock Exchange's market for listed securities. It is expected that Admission will become effective and that dealings will commence on 17 April 2015 and in any event no later than 1 May 2015.

 

Participation in, and principal terms of, the Placing

 

Each of Canaccord Genuity, Peel Hunt and their respective Affiliates (as defined below) is entitled to participate as a Placee.

 

The Placing Price will be a single price of 355p per new Placing Share and will be payable by all Placees.

 

Prospective Placees have been identified and will be contacted by Canaccord Genuity or Peel Hunt.

 

The Placing is expected to close today.

 

Canaccord Genuity or Peel Hunt will re-contact and confirm orally to Placees the size of their respective allocations and a trade confirmation will be dispatched as soon as possible thereafter.  Canaccord Genuity's or Peel Hunt's (as the case may be) oral confirmation of the size of allocations and each Placee's oral commitments to accept the same will constitute a legally binding agreement pursuant to which each such Placee will be required to accept the number of Placing Shares allocated to the Placee at the Placing Price and otherwise on the terms and subject to the conditions set out herein.

 

The Placing Agents reserve the right to scale back the number of Placing Shares to be subscribed by any Placee.  The Placing Agents also reserve the right not to accept offers to subscribe for Placing Shares or to accept such offers in part rather than in whole.  The Placing Agents shall be entitled to effect the Placing by such method as they shall in their sole discretion determine. To the fullest extent permissible by law, neither Placing Agent or any holding company thereof, nor any subsidiary, branch or affiliate of a Placing Agent (each an "Affiliate") nor any person acting on behalf of any of the foregoing shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise).  In particular, neither Placing Agent nor any Affiliate thereof nor any person acting on behalf of any such person shall have any liability to Placees in respect of their conduct of the Placing.  No commissions will be paid to Placees or directly by Placees in respect of any Placing Shares.

 

Each Placee's obligations will be owed to the Placing Agents. Following the oral confirmation referred to above, each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to Canaccord Genuity or Peel Hunt (as the case may be), to pay to Canaccord Genuity or Peel Hunt (as applicable) (or as Canaccord Genuity or Peel Hunt (as applicable) may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire.  The Company shall allot such Placing Shares to each Placee following each Placee's payment to Canaccord Genuity or Peel Hunt (as applicable) of such amount.

 

All obligations of the Placing Agents under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing".

 

Conditions of the Placing

 

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

 

The obligations of the Placing Agents under the Placing Agreement are conditional, inter alia, on:

 

1.   Admission occurring by no later than 8.00 a.m. on 17 April 2015 (or such later date as may be agreed between the Company and the Placing Agents, not being later than 1 May 2015;

 

2.   the Company delivering, by no later than 7.00 a.m. on the day of (and prior to) Admission, to the Placing Agents certificates confirming, inter alia, that none of the representations, warranties and undertakings given by the Company in the Placing Agreement has been breached or was untrue, inaccurate or misleading when made or would cease to be true and accurate were it to be repeated by reference to the facts subsisting on the date of the certificates; and

 

3.   there not having arisen or occurred before Admission any matter, fact, circumstance or event such that in the opinion of the Placing Agents (acting in good faith) a supplementary announcement is required to be made unless a supplementary announcement has been released to a Regulatory Information Service with the Placing Agents' consent.

 

If (a) the conditions are not fulfilled (or to the extent permitted under the Placing Agreement waived by the Placing Agents), or (b) the Placing Agreement is terminated in the circumstances specified below, the Placing will lapse and each Placee's rights and obligations hereunder shall cease and determine at such time and no claim may be made by a Placee in respect thereof. Neither Placing Agent shall not have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision either Placing Agent may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition in the Placing Agreement or in respect of the Placing generally.

 

By participating in the Placing, each Placee agrees that its rights and obligations hereunder terminate only in the circumstances described above and under "Right to terminate under the Placing Agreement" below, and will not be capable of rescission or termination by the Placee.

 

Right to terminate under the Placing Agreement

 

The Placing Agreement may, at any time before Admission, be terminated on behalf of the Placing Agents by giving notice to the Company if (inter alia):

 

a) the Warranties (as defined in the Placing Agreement) are not true and accurate or have become misleading (or would not be true and accurate or would be misleading if they were repeated at any time before Admission) by reference to the facts subsisting at the time when the notice referred to above is given; or

 

b) the Company fails to comply in any material respect with any of its obligations under the Placing Agreement or the Subscription and Transfer Agreement or the option agreement entered into between Canaccord Genuity and the Company to give effect to the placing arrangements; or

 

c) there has been in the opinion of the Placing Agents (acting in good faith), a material adverse change in the business of the Group or in the financial or trading position or prospects of the Group or the Company; or

 

d) there has occurred (A) any change, or development involving a prospective change, in national or international, military, diplomatic, monetary, economic, political, financial, industrial or market conditions or exchange rates or exchange controls, or any incident of terrorism or outbreak or escalation of hostilities or any declaration by the UK or the US of a national emergency or war or any other calamity or crisis; (B) or a suspension of trading in securities generally on the London Stock Exchange or New York Stock Exchange or trading is limited or minimum prices established on any such exchange; or (C) a declaration of a banking moratorium in London or by the US federal or New York State authorities or any material disruption to commercial banking or securities settlement or clearance services in the US or the UK, which, in each case in the opinion of the Placing Agents, acting in good faith, would or would be likely to prejudice materially the Company or the Placing, or make the success of the Placing doubtful or makes it impracticable or inadvisable to proceed with the Placing, or render the creation of a market in the ordinary share capital of the Company temporarily or permanently impracticable.

 

By participating in the Placing, each Placee agrees with the Placing Agents that the exercise of any right of termination or other discretion by the Placing Agents (or either of them) under the Placing Agreement shall be within the absolute discretion of the Placing Agents and that the Placing Agents need not make any reference to the Placee in this regard and that, to the fullest extent permitted by law, neither Placing Agent shall have any liability whatsoever to the Placee in connection with any such exercise.

 

No prospectus

 

No offering document or prospectus has been or will be prepared in relation to the Placing and Placees' commitments will be made solely on the basis of the information contained in this document and any information previously published by or on behalf of the Company by notification to a Regulatory Information Service (as defined in the Listing Rules). Each Placee, by accepting a participation in the Placing, agrees that the content of this document is exclusively the responsibility of the Company and confirms to the Placing Agents and the Company that it has neither received nor relied on any information, representation, warranty or statement made by or on behalf of either Placing Agent (other than the amount of the relevant Placing participation in the oral confirmation given to Placees and the trade confirmation referred to below), any of their respective Affiliates, any persons acting on their behalf or the Company  and neither Placing Agent nor any of their Affiliates, nor any persons acting on their behalf, nor the Company will be liable for the decision of any Placee to participate in the Placing based on any other information, representation, warranty or statement which the Placee may have obtained or received (regardless of whether or not such information, representation, warranty or statement was given or made by or on behalf of any such persons). By participating in the Placing, each Placee acknowledges to and agrees with the Placing Agents for themselves and as agents for the Company that, except in relation to the information contained in this document, it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

 

Registration and settlement

 

Settlement of transactions in the Placing Shares (ISIN GB0006556046) following Admission will take place within the CREST system, using the DVP mechanism, subject to certain exceptions. The Placing Agents reserve the right to require settlement for and delivery of the Placing Shares to Placees by such other means as the Placing Agents respectively deem necessary if delivery or settlement is not possible or practicable within the CREST system within the timetable set out in this document or would not be consistent with the regulatory requirements in the Placee's jurisdiction. 

 

Each Placee allocated Placing Shares in the Placing will be sent a trade confirmation stating the number of Placing Shares allocated to it, the Placing Price, the aggregate amount owed by such Placee to Canaccord Genuity or Peel Hunt (as the case may be) and settlement instructions.  It is expected that such trade confirmation will be despatched on 15 April 2015 and that this will also be the trade date. Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions which it has in place with Canaccord Genuity or Peel Hunt (as appropriate).

 

It is expected that settlement will be on 17 April 2015 on a T+2 basis in accordance with the instructions set out in the trade confirmation.

 

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of 2 percentage points above the base rate of Barclays Bank Plc.

 

Each Placee is deemed to agree that if it does not comply with these obligations, Canaccord Genuity and/or Peel Hunt may sell any or all of the Placing Shares allocated to the Placee on such Placee's behalf and retain from the proceeds, for its own account and profit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The Placee will, however, remain liable for any shortfall below the aggregate amount owed by such Placee and it may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf.

 

If Placing Shares are to be delivered to a custodian or settlement agent, the Placee should ensure that the trade confirmation is copied and delivered immediately to the relevant person within that organisation.

 

Insofar as Placing Shares are registered in the Placee's name or that of its nominee or in the name of any person for whom the Placee is contracting as agent or that of a nominee for such person, such Placing Shares will, subject as provided below, be so registered free from any liability to PTM levy, stamp duty or stamp duty reserve tax. If there are any circumstances in which any other stamp duty or stamp duty reserve tax is payable in respect of the issue of the Placing Shares, neither Canaccord Genuity, Peel Hunt, nor the Company shall be responsible for the payment thereof. Placees will not be entitled to receive any fee or commission in connection with the Placing.

 

Representations and warranties

 

By participating in the Placing, each Placee (and any person acting on such Placee's behalf):

 

1.         represents and warrants that it has read and understood this document in its entirety and acknowledges that its participation in the Placing will be governed by the terms of this document;

2.         acknowledges that no prospectus or offering document has been prepared in connection with the placing of the Placing Shares;

3.         agrees to indemnify on an after-tax basis and hold harmless each of the Company, Canaccord Genuity, Peel Hunt their respective Affiliates and any person acting on behalf of any such person from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this document and further agrees that the provisions of this document shall survive after completion of the Placing;

4.         acknowledges that the new Placing Shares of the Company will be admitted to the Official List of the UK Listing Authority, and the Company is therefore required to publish certain business and financial information in accordance with the rules and practices of such market (collectively, the "Exchange Information") and that the Placee is able to obtain or access the Exchange Information without undue difficulty;

5.         acknowledges that neither Canaccord Genuity, Peel Hunt nor any of their respective Affiliates nor any person acting on behalf of any such person has provided, and will not provide it with any material or information regarding the Placing Shares or the Company; nor has it requested Canaccord Genuity, Peel Hunt any of their respective Affiliates or any person acting on behalf of any such person to provide it with any such material or information;

6.         acknowledges that the content of this document  is exclusively the responsibility of the Company and that neither Canaccord Genuity, Peel Hunt nor any of their respective Affiliates nor any person acting on behalf of any such person will be responsible for or shall have any liability for any information, representation or statement relating to the Company contained in this document or any information previously published by or on behalf of the Company and neither Canaccord Genuity, Peel Hunt nor any of their respective Affiliates nor any person acting on behalf of any such person will be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this document or otherwise. Each Placee further represents, warrants and agrees that the only information on which it is entitled to rely and on which such Placee has relied in committing to subscribe for the Placing Shares is contained in this document and any Exchange Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares, and that it has relied on its own investigation with respect to the Placing Shares and the Company in connection with its decision to subscribe for the Placing Shares and acknowledges that it is not relying on any investigation that Canaccord Genuity, Peel Hunt any of their respective Affiliates or any person acting on behalf of any such person may have conducted with respect to the Placing Shares or the Company and none of such persons has made any representations to it, express or implied, with respect thereto;

7.         acknowledges that it has not relied on any information relating to the Company contained in any research reports prepared by Canaccord Genuity, Peel Hunt, their respective Affiliates or any person acting on behalf of any such person and understands that (i) none of Canaccord Genuity, Peel Hunt any of their respective Affiliates nor any person acting on behalf of any such person has or shall have any liability for public information or any representation; (ii) none of Canaccord Genuity, Peel Hunt, any of their respective Affiliates nor any person acting on behalf of any such person has or shall have any liability for any additional information that has otherwise been made available to such Placee, whether at the date of publication, the date of this document or otherwise; and that (iii) none of Canaccord Genuity, Peel Hunt any of their respective Affiliates nor any person acting on behalf of any such person makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of such information, whether at the date of publication, the date of this document or otherwise;

8.         represents and warrants that (i) it is entitled to acquire the Placing Shares under the laws and regulations of all relevant jurisdictions which apply to it; (ii) it has fully observed such laws and regulations and obtained all such governmental and other guarantees and other consents and authorities which may be required thereunder and complied with all necessary formalities; (iii) it has all necessary capacity to commit to participation in the Placing and to perform its obligations in relation thereto and will honour such obligations; (iv) it has paid any issue, transfer or other taxes due in connection with its participation in any territory and (v) it has not taken any action which will or may result in the Company, Canaccord Genuity, Peel Hunt any of their respective Affiliates or any person acting on behalf of any such person being in breach of the legal and/or regulatory requirements of any territory in connection with the Placing;

9.         represents and warrants that the issue to the Placee, or the person specified by the Placee for registration as holder, of Placing Shares will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to issue or transfer Placing Shares into a clearance system;

10.        represents and warrants that it understands that the Placing Shares have not been and will not be registered under the Securities Act or under the securities laws of any state or other jurisdiction of the United States;

11.        represents and warrants that neither it nor its Affiliates nor any person acting on its or their behalf have engaged or will engage in any "directed selling efforts" with respect to the Placing Shares;

12.        it is not a US Person and is not acquiring the Placing Shares for the account or benefit of a US Person;

13.        represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom prior to Admission except to "qualified investors" as defined in Article 2.1(e) of the Prospectus Directive;

14.        represents and warrants that it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to the Placing Shares in circumstances in which it is permitted to do so pursuant to section 21 of FSMA;

15.        represents and warrants that it has complied and will comply with all applicable provisions of FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving the United Kingdom;

16.        represents and warrants that it has complied with its obligations in connection with money laundering and terrorist financing under the Criminal Justice Act 1993, the Proceeds of Crime Act 2002, the Terrorism Act 2000, the Anti-terrorism Crime and Security Act 2001 and the Money Laundering Regulations (2007) (the "Regulations") and, if it is making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations;

17.        represents and warrants that it is (i)(a) a person falling within Article 19(5) of the FPO or (b) a person falling within Article 49(2)(a) to (d) of the FPO and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business or (ii) a person falling within Article 43 of the FPO, to the extent that article relates to the Company;

18.        unless otherwise agreed by the Placing Agents, represents and warrants that it is a qualified investor as defined in section 86(7) of FSMA, being a person falling within Article 2.1(e)(i), (ii) or (iii) of the Prospectus Directive;

19.        undertakes that it (and any person acting on its behalf) will pay for the Placing Shares acquired by it in accordance with this document on the due time and date set out herein against delivery of such Placing Shares to it, failing which the relevant Placing Shares may be placed with other Placees or sold as Canaccord Genuity or Peel Hunt may, in their absolute discretions, determine and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this document) which may arise upon the sale of such Placee's Placing Shares on its behalf;

20.        acknowledges that none of Canaccord Genuity, Peel Hunt any of their respective Affiliates nor any person acting on behalf of any such person is making any recommendations to it or advising it regarding the suitability or merits of any transaction it may enter into in connection with the Placing, and acknowledges that neither Canaccord Genuity, Peel Hunt any of their respective Affiliates nor any person acting on behalf of any such person has any duties or responsibilities to it for providing advice in relation to the Placing or in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement or for the exercise or performance of any of the Placing Agents' individual or joint rights and obligations thereunder, including any right to waive or vary any condition or exercise any termination right contained therein;

21.        undertakes that (i) the person whom it specifies for registration as holder of the Placing Shares will be (a) the Placee or (b) the Placee's nominee, as the case may be, (ii) none of Canaccord Genuity, Peel Hunt nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement and (iii) the Placee and any person acting on its behalf agrees to acquire the Placing Shares on the basis that the Placing Shares will be allotted to the CREST stock account of Canaccord Genuity or Peel Hunt which will hold them as settlement agent as nominee for the Placees until settlement in accordance with its standing settlement instructions with payment for the Placing Shares being made simultaneously upon receipt of the Placing Shares in the Placee's stock account on a delivery versus payment basis;

22.        acknowledges that any agreements entered into by it pursuant to these terms and conditions shall be governed by and construed in accordance with the laws of England and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such contract;

23.        acknowledges that it irrevocably appoints any director of Canaccord Genuity or Peel Hunt as its agent for the purposes of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares agreed to be taken up by it under the Placing;

24.        represents and warrants that it is not a resident of any Prohibited Jurisdiction and acknowledges that the Placing Shares have not been and will not be registered nor will a prospectus be cleared in respect of the Placing Shares under the securities legislation of any Prohibited Jurisdictions and, subject to certain exceptions, may not be offered, sold, taken up, renounced, delivered or transferred, directly or indirectly, within any Prohibited Jurisdiction;

25.        represents and warrants that any person who confirms to Canaccord Genuity or Peel Hunt on behalf of a Placee an agreement to subscribe for Placing Shares and/or who authorises Canaccord Genuity or Peel Hunt to notify the Placee's name to the Company's registrar, has authority to do so on behalf of the Placee;

26.        acknowledges that the agreement to settle each Placee's acquisition of Placing Shares (and/or the acquisition of a person for whom it is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to an acquisition by it and/or such person direct from the Company of the Placing Shares in question. Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service. If there were any such arrangements, or the settlement related to other dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which none of the Company nor Canaccord Genuity nor Peel Hunt will be responsible. If this is the case, the Placee should take its own advice and notify Canaccord Genuity or Peel Hunt accordingly;

27.        acknowledges that the Placing Shares will be issued subject to the terms and conditions set out in this document;

28.        acknowledges that when a Placee or any person acting on behalf of the Placee is dealing with Canaccord Genuity or Peel Hunt any money held in an account with Canaccord Genuity or Peel Hunt on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the relevant rules and regulations of the FCA. The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from the Placing Agents' money in accordance with the client money rules and will be used by the Placing Agents in the course of their respective businesses; and the Placee will rank only as a general creditor of Canaccord Genuity or Peel Hunt (as the case may be);

29.        repeats the warranties and representations set out above in paragraphs 1 to 28 as if references therein to Placing Share;

30.        acknowledges and understands that the Company, Canaccord Genuity, Peel Hunt and others will rely upon the truth and accuracy of the foregoing representations, warranties, agreements, undertakings and acknowledgements; and

31.        acknowledges that the basis of allocation will be determined by the Placing Agents at their absolute discretion. The right is reserved to reject in whole or in part and/or scale back any participation in the Placing.

 

The acknowledgements, agreements, undertakings, representations and warranties referred to above are given to each of the Company, Canaccord Genuity and Peel Hunt (for their own benefit and, where relevant, the benefit of their respective Affiliates and any person acting on  behalf of any such person) and are irrevocable.

 

No UK stamp duty or stamp duty reserve tax should be payable to the extent that the Placing Shares are issued or transferred (as the case may be) into CREST to, or to the nominee of, a Placee who holds those shares beneficially (and not as agent or nominee for any other person) within the CREST system and registered in the name of such Placee or such Placee's nominee.

 

Any arrangements to issue or transfer the Placing Shares into a depositary receipts system or a clearance service or to hold the Placing Shares as agent or nominee of a person to whom a depositary receipt may be issued or who will hold the Placing Shares in a clearance service, or any arrangements subsequently to transfer the Placing Shares, may give rise to stamp duty and/or stamp duty reserve tax, for which none of the Company, Canaccord Genuity or Peel Hunt will be responsible and the Placee to whom (or on behalf of whom, or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such stamp duty or stamp duty reserve tax undertakes to pay such stamp duty or stamp duty reserve tax forthwith and to indemnify on an after-tax basis and to hold harmless the Company, Canaccord Genuity and Peel Hunt in the event that any of the Company and/or Canaccord Genuity and/or Peel Hunt has incurred any such liability to stamp duty or stamp duty reserve tax.

 

In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares.

 

All times and dates in this document may be subject to amendment.  Canaccord Genuity or Peel Hunt shall notify the Placees and any person acting on behalf of the Placees of any such changes.

 

This document has been issued by the Company and is the sole responsibility of the Company.

 

The rights and remedies of Canaccord Genuity, Peel Hunt and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise or partial exercise of one will not prevent the exercise of others.

 

Each Placee may be asked to disclose in writing or orally to Canaccord Genuity or Peel Hunt:

 

(a)  if he is an individual, his nationality; or

 

(b)  if he is a discretionary fund manager, the jurisdiction in which the funds are managed or owned.

 

 

 



 

Appendix 3

Definitions

 

In this announcement (including the Appendices), save where the context requires otherwise:

 

Admission

admission by the UKLA of the Placing Shares to the Official List by the making of an announcement in accordance with LR 3.2.7G of the Listing Rules and the admission of the Placing Shares to trading on the London Stock Exchange's main market for listed securities in accordance with the Admission and Disclosure Standards produced by the London Stock Exchange

 

Board

the board of Directors

 

Canaccord Genuity

Canaccord Genuity Limited

 



Charles Stanley or the Company

Charles Stanley Group PLC

 

Charles Stanley Financial Solutions

Charles Stanley Financial Solutions Limited, a subsidiary of the Company

 

Charles Stanley Securities

Charles Stanley Securities, a division of the Group

 

CIP

Central Investment Proposition

 

CSD or Charles Stanley Direct

Charles Stanley Direct, a division of the Group

 

Directors

the directors of the Company

 

EBS

EBS Management PLC, a subsidiary of the Company

 

FCA

the UK Financial Conduct Authority

 

FSMA

the Financial Services and Markets Act 2000 (as amended from time to time)

 

Group

the Company and its subsidiary undertakings

 

IFA

independent financial adviser

 

Listing Rules

the Listing Rules of the FCA

 

London Stock Exchange

London Stock Exchange plc

 

Official List

the official list of the FCA

 

Ordinary Shares

ordinary shares of 25p each in the capital of the Company

 

PCIM

the Group's Private Client Investment Management division

 

Peel Hunt

Peel Hunt LLP

 

Placing

the placing of the Placing Shares by the Placing Agents on behalf of the Company with existing investors

 

Placing Agents

Canaccord Genuity and Peel Hunt

 

Placing Agreement

the placing agreement dated 15 April 2015 between the Company and the Placing Agents in respect of the Placing

 

Placing Price

355p per Placing Share

 

Placing Shares

The 4,596,000 new Ordinary Shares being issued pursuant to the Placing

 

Shareholders

holders of Ordinary Shares

 

SIPP

self-invested personal pension

 

UKLA

the FCA acting in its capacity as competent authority for the purposes of FSMA

 

WMA Balanced Index

the Balance Index provided by FTSE and the Wealth Management Association

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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